Apt. Renters & Condo Buyers Receive Much-Needed Incentives in Increasingly Tough Times

By Anuradha Kher, Online News EditorNew York–As consumer confidence dips and uncertainty abounds over the possible impact of the administration’s new policies, buyers and renters in the multifamily market are feeling increasingly wary. To tackle this, a number of developers and managers are offering a variety of incentives. The most common of them is the ability for a renter to get out of their lease in case of a layoff, without any penalties. Similarly, Solaria condominium, a luxury community located in New York’s Riverdale neighborhood, is offering a program through which it will pay the mortgage, common charges and real estate taxes for up to one full year if a buyer is laid off.Solaria completed its first closing in January 2008. Since then, only 10 units at the property have closed, with 15 currently pending.With one- to five-bedroom units ranging from $540,000 to $2.5 million, the community offers luxury amenities as well as proximity to some of the best public and private schools like Horace Mann, Fieldston, PS 24, MS 228, Riverdale Country, Manhattan College and SAR Academy.Arc Development is now offering certain initiatives, such as the Home Assurance program, which protects a buyer or spouse if one of them is laid off. In that case, Solaria Riverdale will pay the mortgage, common charges and real estate taxes for up to one full year. Unlike a typical mortgage insurance program, Home Assurance factors in the full range of financial concerns of condominium ownership. “Since Lehman went under, there has been little velocity in New York,” Arc Principal Joseph Korff, tells MHN. “People are fearful of losing jobs, of finding financing to buy homes, about the value of their homes going down. This program directly attacks these fears. These incentives will make people more comfortable while buying a home.”He adds, “Our goal was to remove uncertainty from the home ownership equation.” In addition to the Home Assurance Program, Arc is offering these additional incentives: • Rent-to-Own: Arc has seen how well the product has been received by homeowners, and the developer is offering the opportunity to put a portion of lease payments toward the final closing price of a home. Arc likens this to test driving a new car and invites traditional renters to consider this option.• 90 percent financing: This is available to qualified buyers at historically low rates. Arc sees this as giving Solaria buyers an edge as many banks have increased their down-payment requirements.• Education credit: Arc is offering a $30,000 education credit at closing, a perfect fit for families living in Riverdale, which is home to some of the region’s best public and private schools like Horace Mann, Fieldston, PS 24, MS 228, Riverdale Country, Manhattan College and SAR Academy. Similarly, Resource Residential has launched the Lease Assurance Program designed to assure renters worried about losing their jobs that they won’t suffer any of the negative financial or credit implications of breaking a lease. The Philadelphia-based apartment management company manages more than 12,000 apartments at 50 apartment communities in 24 cities across the U.S.“People in this day and age want and expect to be treated properly,” says Harlan Krichman, president of Resource Residential. “We’re all about communication and are constantly listening to our residents to address their needs. Right now, our residents are telling us that they are concerned about paying their bills, including rent, if they lose their jobs, and we want to help ease those fears.”“We wanted to create a program where residents wouldn’t be penalized by us for their unfortunate position of being involuntarily out-of-work,” adds Krichman.While much of the focus in the media has been on the increase in foreclosures and short sales, and on rapidly falling home prices, the rental sector of the real-estate industry too feels the effects of the declining Dow and the climbing unemployment rate. By launching this program, Resource Residential aims to recognize and addresses this uneasiness. Explains Krichman, “We think it’s our responsibility in this economy to make people feel comfortable with their decision to live at a Resource Residential apartment community.”Western National Property Management too recently launched its Layoff Protection Program, which allows those residents who lose their jobs to cancel their leases without penalties. (Click here to read our coverage of this.)