Bubble Wrap: February 2009

That Old Master? It’s at the Pawnshop

Curbed comments on the interesting NY Times article revealing the growing trend of loans backed by art along with real estate, especially for artists struggling with their personal finances.

“It’s very discreet,” said Ian Peck, a co-owner of Art Capital.

This little-known corner of the art business is lightly regulated and highly litigious. But this has not dissuaded clients who have included rich collectors like Veronica Hearst, art galleries and prominent artists themselves, including Ms. Leibovitz and Julian Schnabel.

Taxing times for homeowners

The Herald News reports on the prospect that declining real estate values could eventually provide tax relief to some of the highest property taxes in the country. If a homeowner appeals their tax assessment, it doesn’t necessarily mean they will win, as winning tax appeals hasn’t risen much in NJ this year.

“We’re anticipating a substantial number of tax appeals,” said Louis Izenberg, an appraiser who represents towns and large property owners. “Having said that, at the end of the day, the New Jersey Tax Court relies upon evidence, and for the first time I can recall, we really don’t have an abundance of data.”

Toll Brothers Slashes Brooklyn Condominium Prices by Up to 37%

Bloomberg follows up with the big price cuts at One Northside Piers by reporting that 5 units have since gone pending, leaving 55 still unsold. If Toll Brothers is successful in drawing more buyers because of these cuts, experts believe other developers could follow suit.

“There is a stirring going on in the market, but only at a lower price point,” Michonski said. “Once prices reach a certain level there is a market—and a robust market.”

More price reductions are likely, he said, “especially if this works, which I think it will.”

The Quiet Listings

Max Abelson of The Observer reports on the recent increase in trophy properties asking astronomical prices without officially being on the market.

One reason for the spate of these very hushed listings is embarrassment over asking such huge sums during such a hugely depressed time. On the one hand, sellers don’t want to seem uncouthly, insensitively ambitious; and then again they most certainly don’t want to seem desperate: “Some of the prices are so egregious and greedy,” a broker who has one of New York’s biggest listings said this week. “Why would you put the thing on, have friends speculate on why you would or wouldn’t be selling? You do it quietly, and if someone gives you the right number, then great.”