Gea Elika's Blog, page 129

Analyzing Historical Real Estate Performance in a Rising Interest Rate Environment

Discussions about rising interest rates and the corresponding impact on mortgage borrowing rates is a popular news topic. The average rate continued to rise, with the fixed 30-year mortgage increasing to 4.38% last week from 4.32% and 4.22% the prior two weeks, according to Freddie Mac (all mortgages rates referenced are based on this agency’s information). This is has been steadily increasing, up from under 4% at the end of last year.

Everything else being equal, higher borrowing costs means a larger monthly payment. You can use the situation to your advantage in negotiations to perhaps strike a better price, more than making up for the higher interest rate, while also reaping a larger potential capital gain down the road. Since this is a complicated area, it is useful to break it down how New York City real estate has done in various interest rate environments.

The ‘70s

This was a difficult time for the country and the city. In fact, NYC nearly went bankrupt. Macroeconomic issues affecting the country and the city included the OPEC embargo, with gas prices doubling twice in the decade. Along with other factors, this helped drive double-digit, “run-away” inflation. In 1973, inflation jumped from under 4% to nearly 10%, and the Federal Reserve raised short-term rates in an attempt to get it under control. Similarly, the Fed raised rates to about 20% in 1979-1980 to break inflation’s back.

The 10 year Treasury rate started the decade under 10%, and finished near 11%. Highlighting a particularly difficult period, at the start of 1974, the yield was 6.99%, and finished 1979 at 10.8%. Meanwhile, the 30-year mortgage rate went from 7.3% in April 1971 (the furthest back Freddie Mac’s data goes) to nearly 13% by the end of 1979.

The NYU Furman Center, which studies public policy and real estate, noted prices fell 12.4% from 1974 through 1980. Interestingly, while the other boroughs experienced price declines, Manhattan’s real estate saw a 29% increase.

The ‘80s

The decade started with negative sentiment about the economy, with Federal Reserve Chairman Paul Volker driving up short-term rates. The 10-year yield peaked at nearly 15% in 1982, and the 30-year mortgage fixed rate reached 18.6% in 1981. The mortgage rate bounced around a bit but ended the decade in the upper-9%-10% area.

After the early-1980s recession, the economy performed well. This helped lead to a strong real estate market. With inflation taming and lower borrowing costs, real estate prices, which had been tempered the previous decade, thrived. New York City experienced a 152% price increase, with Manhattan, Brooklyn (particularly areas close to Manhattan), and Queens doing better than the city’s average.

The ‘90s

The decade started off in a recession, partly triggered by the S&L crisis. Lending standards tightened and credit becomes more difficult to obtain. However, the Clinton presidency brought on more aggressive deficit reductions, and long-term interest rates fell. Along the bond market doing well, stock and real estate prices soared.

Ten year Treasury yields started at 8.2% and began 1999 at 4.7%, although it rose to 6.7% at the end of the year. Mortgage rates were 9.8% and finished the 1990s at 8.1%. Prior to the end of the decade, rates hovered at the 7% level and even dipped below it.

New York City’s real estate prices fell in the first half of the decade. In the 1989-1996 period, prices were down 29%, with Manhattan, the Bronx, and Staten Island performing worse. This came about despite generally falling interest rates. The 30-year mortgage rose from 9.8% to over 10% during 1990, before falling through 1994. The mortgage rate was under 8% by the end of 1996.

The mid-‘90s to 2006

During this time, which included the bursting of the tech bubble and 9-11 terrorist attack, mortgage rates fell dramatically. It was below 6% at one point. The recession was brief, and New York City’s real estate prices rose 124%. Manhattan and Brooklyn were notable hot spots.

2007-Current

Furman doesn’t have pricing data for this period, which started with the severe recession and housing crash. Mortgage rates were above 6% for most of 2007, but have generally been below 5%, and even lower than 4% for the latter parts of the current era. New York City’s real estate, responding the severe economic conditions, fell sharply, before spending the last several years in a recovery as the economy rebounded.

Final thoughts 

Interest rates are one factor among several that impact the real estate market. It appears the overall economy is the most important. During the last recession, while mortgage rates fell, real estate prices did not recover until economic conditions, particularly the jobs market, improved, making people more confident about making a large-scale purchase.

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Top 5 Reasons why FSBO’s Fail in Real Estate

A for sale by owner, or FSBO, the transaction is a common method for homeowners who see a chance to make a better profit by cutting out the realtor commission. It may seem like a better deal but according to the NAR Profile of Home Buyers and Sellers, that is not the case. The average FSBO price was $185,000 while the average for a home sold through an agent was $245,000. That’s a difference of $60,000 which can easily cover the agent’s commission (usually 6%) and leave a better profit.

If you’re still considering selling on your own here are the top reasons FSBO’s fail in real estate.

 

1. You have to do all the marketing yourself

These days, buyers always start their home search online. Sellers trying to market on their own will be unable to devote fulltime work to it and won’t reach as wide an audience. The NAR report found that 42% rely on a yard sign, 32% rely on friends and family and a little under 15% rely on social media.

Without the use of an agent, you’ll be very limited in the number of prospects you can attract. A real estate agent knows how to properly market a property and has contacts with other agents that can share the listing with their clients.

2. FSBO homes can be priced wrong

The key to any listing price is to find the sweet spot. Not too high and not too low. Without market knowledge and experience it’s hard to find that sweet spot. Those selling through FSBO tend to set a price based on an online assessment tool or their own gut feeling.

An overpriced home can languish on the market for months or even years. Even if you lower the price later it can be stigmatized by buyers who see that it has been on the market a long time. A trained agent knows how to price correctly and find that sweet spot in no time.

3. You have to handle all the paperwork

The NAR report also found that understanding paperwork was the most daunting task for FSBOs. Selling a home in NYS can require as much as 15 different documents which must all be filled in and filed correctly.

Without a competent agent to guide you through the paperwork, mistakes and misunderstandings can happen. Failure to file paperwork correctly can cause delays and result in a whole deal being canceled. Unless you have a background in law or contacts its best to lave paperwork to the pros.

4. Liability is all on the seller

Everyone makes mistakes but a seller not represented by an agent pays for those mistakes. Real estate agents have errors and omissions (E&O) insurance, along with enough experience to catch a mistake. If you make a false claim, even unknowingly, in the listing or paperwork you could be liable for litigation.

5. Hidden costs can add up

The whole point of FSBO is to save money. What’s often not taken account of though is the many hidden costs in selling. You’ll need to pay for signage, photography, flyers, home inspection, contacts and so much more. It’s hard to estimate these costs so they can quickly fly out of control. Working with an agent means all the extra work gets taken care of and ensures nothing is forgotten.

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Everything You Need to Know about Buying a Loft in NYC

New Yorker’s in search of something different are widening their options by looking at lofts. With wide-open spaces with high ceilings, it’s easy to see the appeal. Nowadays they can fetch very high prices. They can also prove difficult to find due to a very limited inventory. One thing for sure, they definitely provide a different living experience to a traditional home.

 

 

So, what is a loft?

A loft is usually defined as a former commercial space that has been converted into a residential area. They usually feature wide-open spaces, large windows high ceilings, columns, and exposed brick, beams and pipes. They range in size from 1400 to 2400 square feet in Manhattan. Outside Manhattan, they tend to be smaller.

As commercial companies left the city for cheaper locales they left many of these buildings abandoned. They became popular with artists who found the wide-open space easier to work in. It wasn’t until the 1970’s that they became fashionable and now they are in very high demand.

Why would a buyer prefer a loft over a traditional apartment?

Many people choose lofts for the wide-open spaces they provide and large windows which make them seem even bigger. They’re also great for accommodating a growing family. It’s easy to renovate the floor plan however you desire, making them very versatile.

Another thing people love about lofts is the original details such as exposed pipes that give it a history. Plus, all the open space is great for entertaining large numbers of guests.

What are the downsides to loft living?

For many first-timers, the level of space can be a bit disorientating. It can be difficult decorating such a large space. Whatever theme you choose has to include the whole room if you want to be consistent.

The lack of privacy is also an issue and many loft buildings lack the usual features found in condos like doormen and gyms. Also, since few are located in mixed-use areas they tend to share the block with light manufacturing which makes noise levels a problem. More often found in Brooklyn vs Manhattan.

Where can you find lofts?

You can find lofts everywhere in areas with former industrial buildings and warehouses. For Manhattan, the highest concentrations can be found in SoHo and Tribeca. Buyers can also find many in Chelsea and Flatiron. You can also find them, but in lesser numbers, in Greenwich Village and Hell’s Kitchen.

Those in Brooklyn should focus their search on Red Hook, Clinton Hill, Dumbo, and Williamsburg. Anyone in Queens should search Long Island City while in the Bronx Kingsbridge is the place to start.

Are lofts typically more or less expensive than traditional apartments?

It depends. Today, many developers are bringing the best-of-the-best in materials and finishes to loft buildings. The installation of a new kitchen and bathroom will be built into the price tag which puts developed lofts in a very high price range.

However, if you manage to find a loft in an ‘as-is’ condition and develop it yourself they can potentially be less expensive than a regular apartment. Either way, the low numbers and high demands for lofts keep them at a high price. They can make a smart investment because although only representing 10% of the condo and co-op market, those who love them will pay a high price.

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A Guide to NYC’s Literary Haunts

New York has been the home of countless writers and poets over the years. All of whom flocked to find inspiration in the city’s streets and talk shop with other writers. The taverns, cafes, and bistros that they frequented have become quite famous as a result. For book-lovers new to the city, these are some of the top spots for soaking up the NYC literary atmosphere.

 

Blue Bar at the Algonquin Hotel / Image by NYTimes

 

White Horse Tavern

Still retaining much of its 1880’s feel, the ancient White Horse can be easily found on Hudson Street from the giant horse head neon sign. It holds the distinction of being the bar where Welsh poet Dylan Thomas drank himself to death after 18 shots of whiskey. A plaque over his favorite seat commemorates him. He was far from the only writer to visit regularly. During the 50’s and 60’s you could find Allen Ginsburg and Jack Kerouac drinking here, as well as James Baldwin, Anais Nin, and Norman Mailer. It’s still a popular spot today.

Kettle of Fish

Located in West Village, Kettle of Fish has moved twice since it first opened in 1950. Taking both its name and colorful history with it. It’s always been a popular hideout for intellectuals, writers, and musicians, including Bob Dylan, Kerouac, and Corso. You can find it at 59 Christopher Street, where it draws a mix of creative types and sports fans.

Café Loup

This unpretentious West Village bistro continues to bridge the generations with its appeal to editors, academics, and writers. In the late 90’s you could find Susan Sontag and Paul Auster here. It’s still a worthy place for making contacts in the writing and publishing world.

Blue Bar at the Algonquin Hotel

Envisioned by its first owner as a cultural and literary bastion, the Blue Bar has drawn a lot of distinguished guests since it first opened in 1902. Among them have been Dorothy Parker, Simone de Beauvoir, and Maya Angelou. The New Yorker was first born here and the bar still provides guests with a free copy to this day.

Minetta Tavern

For a vintage bistro experience, Minetta’s Tavern still keeps that old New York feeling alive. A black-and-white checkered floor, an oak bar and framed photos of famous patrons such as Ernest Hemingway, Ezra Pound, E.E Cummings make it a unique place to stop for lunch. Make sure to check out the original fresco depicting Greenwich Village life in the back room.

Hungarian Pastry Shop

Located uptown in Morningside Heights. This laid-back café has been popular with students and writers from the nearby Columbia University since it opened in the 60’s. it hasn’t changed much over the years. It’s cash-only, there’s no Wi-Fi or electrical outlets for laptops and it still serves old-fashioned pastries and coffee.

Nuyorican Poet’s Café

Poetry lovers won’t want to miss this one. Located on the Lower East Side, this is where open-mike poetry meets contemporary culture. If there’s a competition on be sure to get there early as the line can get pretty long. Inside its warm and jubilant with lots of cheap beer bottles to be had.

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Higher Interest Rates and Housing

Long-term bond yields have risen for a multitude of reasons. These include recent economic data indicating a pick-up in inflation, such as the recent jobs report showing a tighter market and higher wages. Additionally, the recently passed tax cut legislation is going to drive budget deficits higher, and the Federal Reserve is tapering its bond-buying program. The 10 year Treasury yield, which correlates to the popular 30-year fixed-rate mortgage, has been hovering around 2.8% recently, compared to last year’s 2.2%-2.5% level.

 

 

In response, the 30-year fixed-rate mortgage has seen the rate climb to 4.22%, on average, according to Freddie Mac. This compares to under 4% for most of last year.

This situation creates stress for buyers, naturally. Higher borrowing rates mean a larger monthly payment, all else equal. However, you need not fret. You can use this situation to your advantage, and you do not have to get stuck paying more every month.

The greatest sensitivity

We have found the $3 million and under market the strongest part of New York City’s real estate market. It is also the most sensitive to interest rate changes for a variety of factors. Those shopping at the lower end are more sensitive to higher payments. Personal income may be up, but spending has risen faster. This means less savings, potentially pricing these homebuyers out of the market.

Luxury property buyers likely have alternative sources, including greater cash reserves, to fund the purchase. The market has already been experiencing weakness, in any case.

This seems like a frustrating situation, but it is not as bleak as it appears.

Hope for the home buyer

House hunters should not lose faith. If they are ready to make a purchase and see a deal,  buyers should act quickly/ Sellers may not have caught up to the story since demand may not have softened, yet. They are typically slow to accept a slowing market. Therefore, if you are comfortable, and your buyer’s agent feels this is a fair price, do not be afraid to act. Interest rates could go up further, raising your monthly payment.

Assuming an $800,000 purchase and a 20% down payment, your monthly payment is $3.137 (principal and interest). Just a quarter-point rate increase causes your outlay to rise to $3,231, nearly an extra $100 dollars you would have to fork over per month.

Another strategy is to try to wait, hoping this gives you greater bargaining power. This is risky, predicated on higher rates and further softening demand, however. 

Final thoughts

U.S. Treasury yields retreated a few basis points this week. This was due to the stock market’s pullback. Investors took a “risk off” approach, piling into risk-free Treasuries rather than riskier assets, such as equities. The 10-year yield fell back to 2.77% from 2.84% in the wake of the equity market’s pullback in February.

While it is challenging to predict future interest rate moves, homebuyers should not count on this trend continuing. Ultimately, market fundamentals, with a particular eye on inflation, will be the driver of interest rates.

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10 Free Things to do in NYC

It’s no secret that New York is an expensive city to visit but that doesn’t mean you need to spend a fortune to have fun here. In fact, the city is full of free things to do and see. Whether you’re a tourist here for a few days or a long-time resident you can always find things to do that won’t cost you a dime.

 

Image by Artnet.com

 

1. The Museum of Modern Art

The MOMA has a lot to offer and you can see it without paying the $25 admission fee. Every Friday from 4 pm to 8 pm you can get free admittance. You can also see the sculpture garden for free every day from 9:30 to 10 am.

2. Brooklyn Botanic Garden

A trip to the Brooklyn Botanic garden is a great way to escape the hustle and bustle of the city. On Tuesdays, you can enjoy the whole area for free.

3 Stargazing at the High Line

it’s well known that you can see New York’s most famous elevated park for free but less well known is the free stargazing. Every Tuesday, starting at dusk, the Armature Astronomers Association sets up telescopes along the stretch from West 15th to West 16th Street. It’s a perfect time to visit the park and usually less crowded than during the daytime.

4. The Staten Island Ferry

A trip to New York wouldn’t be complete without a boat trip on the Hudson or East River. These trips though cost money, except for the Staten Island ferry which is completely free.

5. Attend a Cultural Event at the New York Public Library

The Public Library is hard to miss but less well known is the Schwarzman building on 42nd Street and 5th Avenue. This architectural gem is not only free to visit but also hosts archival photographs and lectures by acclaimed authors.

 

 

6. Kayak the Hudson River

From mid-May to mid-October you can take out a kayak on the Hudson River for free. Just head to Pier 26 in Tribeca. It’s first come first serve so make sure to get there early.

7. Distilling Company Tour and tasting

Feel in the mood to try some gin and whiskey? One of Brooklyn’s best distilleries does free tours on the weekends between 2 pm and 5 pm.

8. The Galleries of Chelsea

Art lovers won’t want to miss the chance for free galleries and Chelsea is where you can find most of them. Check the guide for listings and try to make your visit on Tuesdays for wine-and-cheese openings.

9. The New York Earth Room

Now for some real dirt. Located in SoHo, the Earth room is a 22-inch-deep layer of dirt spread across a 3,600 square foot gallery space. Inside the smells of New York are reduced to only one, the rich smell of soil. Admission is free and it’s certainly something different.

10. See the Gold at the Federal Bank

A little known but fascinating attraction lies in the Financial District, 6,500 tons of gold. Most of it arrived after WWII and anyone can sign up to see it for free on weekday afternoons.

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These Books will make you Fall in Love with NYC

New York is a city like no other. Let it grab hold of you and it can be difficult ever leaving. For instance, the city boasts a rich literary tradition with many authors making it the main setting or digging into its colorful history. For those who dream of making it home these books capture that feeling of what the city is about.

 

The Catcher in the Rye by J.D Salinger

Salinger’s controversial novel may not say too much about New York but it’s fun to retrace Holden’s path. To begin with, he starts with an unsuccessful time at a Greenwich Village nightclub. Later on, he stops at Grand Central Station and then goes ice-skating at Rockefeller Center. After that, he sees a Christmas show at Radio City Music Hall. Along the way, he thinks a lot about the ducks in the lagoon at Central Park.

 

 Breakfast at Tiffany’s by Truman Capote

Capote beautifully captures the glamor of New York through the eyes of Holly Golightly. When she’s not Spending her mornings at Tiffany & Co. on Fifth Avenue she’s socializing with wealthy men who wine and dine her at the cities most established clubs and restaurants. It’s a fascinating character study and gives a glimpse of the luxurious lifestyle of the Upper East Side.

 

A Tree Grows in Brooklyn by Betty Smith

For a trip back in time, A Tree Grows in Brooklyn is a must read for those new to the city. This coming-of-age story follows Francie Nolan, a Williamsburg resident, from the age of 11 until she leaves for college. Through her perspective, we see life in an impoverished first-generation immigrant family as they struggle to make ends meet.

 

The Power Broker: Robert Moses and the Fall of New York by Robert A. Caro

This Pulitzer Prize-winning biography takes us into the life and accomplishments of Robert Moses. Giving us an insight into New York power politics and the stories behind some of its iconic construction projects. It’s a great way to build an appreciation for the beautiful parks Moses created and the Verrazano-Narrows Bridge.

 

Here is New York by E.B White

This love-letter to the city captures the unique feeling of New York and shows what it means to live there. White begins with the paradox of the noisiness and loneliness of living there. Saying that the city has the ability to give “the gift of loneliness and the gift of privacy” once you travel there and experience it with the locals. It’s a great introduction for those visiting for the first time.

 

New York: The Novel by Edward Rutherfurd

Do you like a history lesson sprinkled with fictional accouterments? Rutherfurd’s novel chronicles the cities 400 years history and takes you from the arrival of the first European colonists in the 17th century up until when the book was published in 2009. The cities colorful history is told through a series of fictional families that embody the qualities of a family living at that time.

 

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8 Essential Questions to Ask a Potential Roommate

Whether your sub-letting your New York apartment or looking for college roommates, it’s always good to know what you’re getting into. Even if you know the person, unexpected issues may arise when you start living together. To save you both a lot of headaches it’s best to learn as much about each other as you can. Here are eight essential questions to ask a potential roommate.

 

 

1. What’s your definition of clean?

Standards of cleanliness are one of the biggest areas of conflict for roommates. Some people wash the dishes immediately after use while others wait until the sink is overflowing. Some consider sweeping every other day normal, others don’t even know how to operate a vacuum. Instead of asking them how clean they are, find out what their habits are. It’s always best to find someone in the same cleaning boat as yourself.

2. Do you like to smoke or drink in the house?

This is so important if you have strong feelings against certain substances. If your lease forbids smoking indoors then that’s a deal breaker there. Whatever your own habits are you’ll want to be on the same wave-length as your roommate.

3. What’s your daily schedule?

Beyond just knowing if their a ‘night-owl’ or ‘morning-person’ it’s good to know what a ‘typical’ weekday or weekend is for them. If they need nap-time during the day or like to practice kickboxing every night before bed this is something you’ll want to know.

4. Do you like to have friends over often?

If you’re studying for the bar or working a full-time job it may be better to know what kind of house you’ll be coming back to each night. If they plan on inviting a lot of friends over every week and turning the place into party central then it may not work out.

5. Do you have references?

You wouldn’t accept a job applicants word on how good they are, nor should you with a roommate. Ask for referrals from former roommates or work colleagues. Two or three should be enough.

6. What’s your romantic situation?

If they’re in a relationship then there’s a chance you could be signing on for a third roommate. If it’s a serious relationship then expect lots of sleepovers. There’s also the potential of feeling like a third-wheel in your own home.

7. Do you have any pets?

Many New York buildings have pet restrictions so find out what you’ll be dealing with. Also, just because they don’t have a pet now doesn’t mean they won’t rescue one and bring it home one day. If you have any allergies make this clear.

8. What do you want in a roommate?

You’re both going to be looking for someone you can get along with so establish what it is your each looking for. Use this moment to work out any conflicts or difficulties you may encounter living together.

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Top 5 Tips for First-time NYC Landlords

For almost every New Yorker, renting your first apartment is a rite of passage. Stay long enough in the city, and there may come a time when you switch sides from tenant to landlord. Whether you’re the owner or subletting here are some tips to get you started with being a landlord in NYC.

 

Image by Vivienne Gucwa / Flickr

 

1. Know the rules

The first thing you’ll need to do is get approval from someone. This could be the board, your landlord or the management company and you’ll need to know the building’s rules as they can change from one to another.

A condo board has the right of refusal to rent the unit, meaning if they reject your proposed tenant they have to match your price. However, this rarely happens, most boards don’t care about the tenant so long as the basic requirements are met.

Co-ops, on the other hand, are far more active with vetting prospective tenants and have the right to accept or refuse without any explanation. They also tend to limit the length of the sublease and the number of times you can sublet. Co-ops also typically charge the owner a sublet fee, usually a percentage of the gross monthly rental or profit.

2. Screen your tenants

Once you’ve attained permission as a rental housing provider and decided on a price, next comes finding the right tenants. The success of your market venture depends to a great extent on the tenants you choose and the best way to find good tenants is by using good screening practices.

Carefully look through every tenant application, paying close attention to credit report, criminal history, and eviction reports. You can run a credit check through a screening service like Experian, the tenant pays the $15 fee.

It’s also good to ask for past landlord references, job references and anything else that can prove the quality of the tenant and their ability to meet the monthly payments.

3. Hold up your end of the deal

One of the biggest mistakes first-time landlords make is not understanding their full responsibilities. This should be made clear in the lease, stating which repairs you, as the owner, are responsible for both physically and financially.

If you’re a co-op or condo owner, you are responsible for ensuring all systems and amenities are functioning, such as gas, electricity, smoke detectors, etc. To better understand your responsibilities as a landlord read up on the New York State attorney general tenants’ rights guide.

4. Have a reserve fund

Your motto should always be “Hope for the best but plan for the worst.” Make sure you have a reserve fund for both planned and unplanned maintenance. Even if the damage was caused by your tenant, you might still have to pay out-of-pocket expenses.

5. Set up an easy rent collections method

Lastly, ensure you have a smooth rent collection method that works for both you and your tenant. These days it’s effortless to collect rent through online services such as PayPal, SquareCash or just a good old bank transfer.

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How the Neighborhoods of Manhattan got their Names

Despite only measuring 24 square miles, Manhattan certainly has a lot of neighborhoods and some have very peculiar names. While other areas were logically named after notable people or landmarks these ones may not seem intuitive to the average tourist or even to a lifelong New Yorker. Here’s where the names of some of Manhattans most famous neighborhoods came from.

 

Image by pendergast-01 / Flickr

 

Tribeca

After the term DUMBO was coined in Brooklyn out of the initials of “Down Under the Manhattan Brooklyn Bridge Overpass, it became increasingly common to do the same for other neighborhoods. Tribeca (some insist on TriBeCa) comes from the first two or three letters from “Triangle Below Canal Street) and roughly refers to the area between the Hudson River, Canal Street, and Vesey Street.

Hell’s Kitchen

For decade businesses and real estate agents have been trying to clean up the reputation of this west side neighborhood by renaming it ‘Clinton’ (in honor of early NYS Governor DeWitt Clinton) but residents still persistently refer to it as Hell’s Kitchen. There are many theories about the name but the most often repeated one is when Dutch Fred, a veteran policeman, overserved a small riot with a rookie cop. Allegedly, the rookie cop said, “This place is hell itself”, to which Dutch Fred replied “Hell is a mild climate, this is hell’s kitchen.

From the 19th to 20th centuries, this was one of the most gang-ridden and toughest parts of town. It’s since cleaned up but the name refused to fade.

Harlem

For such a well-known neighborhood, the origin of the name is rather muted. Harlem is a modification of ‘Haarlem’, a city in the Netherlands after which this former Dutch village is named.

Greenwich Village

This Bohemian neighborhood gets its name from a redundant use of old English as ‘Wic’ or ‘Wich’ originally meant village. It’s also said to come from the Dutch word ‘Greenwijek’ which means ‘Pine District’. Since then, the name has been angelized to ‘Greenwich’. In earlier days, it was a popular spot for landed gentry who enjoyed its heavily wooded areas (hence the green).

SoHo

Like Tribeca, SoHo takes its name from an abbreviation of the term, South of Houston. In earlier years, it was a sleepy manufacturing and warehousing part of town. This small region, which runs from Canal Street north to Houston and from the Hudson River to Broadway is now a major center for shopping and nightlife.

Chelsea

The original 94 acres of this neighborhood was bought by British Major Thomas Clark who named it after a veteran’s retirement home in Britain. Over the years Chelsea estate would pass through many hands but still retain its name. The area is now known for its mid-to-late 19th-century townhouses.

The Meatpacking District

This bustling nightlife and shopping district got its name from a very literal beginning. After the purchase of the underwater rights for the Hudson River the railway opened and the neighborhood became a farmer’s market to take advantage of the new commuters. In 1866 the city declared the area a public market which boasted more than 250 slaughterhouses and meatpacking plants. It’s changed since then but like other neighborhoods, the name remains.

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