It was an unprecedented year for most of us in New York real estate. All of a sudden, the mantra of “20-percent down or bust”–or even 10 percent down, for that matter–no longer applies, as mortgages can be had for as little as 3.5 percent down in certain neighborhoods. And when was the last time anyone could happily underbid on an asking price and expect to get the home of their dreams?

“It was a difficult year,” said the president of Halstead, speaking to Crain’s New York. It was “one of the weakest markets in decades,” reads a report released by the CORE. The first half was the worst: “everything stopped,” told a managing director at Prudential Douglas Elliman to Crain’s. The second half fared better for sellers, in part spurred on by the then-expiring tax credit for first-time buyers, which, for better or worse, was extended to April and even expanded. But new Freddie Mac and Fannie Mae regulations have made it more difficult for buyers–despite rock-bottom mortgage rates to get in without a substantial nest egg. And while we ended the year up from the very bottom, not everyone’s convinced there won’t be a second dip in 2010. One thing is for sure, however–2009 has been a year of reassessment.

Jonathan Miller, of Miller Samuel Inc, points out in the Crain’s article that Manhattan inventory hit the decade’s peak in the first quarter, with 10,455 units–not counting the 7,000 or so estimated units in the shadow inventory, which developers aren’t actively marketing. Fannie and Freddie’s new lending requirements stopped covering anything less than 70-percent pre-sold, forcing some developers to consider alternate channels, such as the Federal Home Administration loan insurance program–which allowed buyers to put down as little as 3.5 percent–for the first time.

Not everyone suffered–as pointed out on this blog, many cash buyers swooped in during the second half of the year, making life easier for everyone involved and speeding up signing the agreement to mere days. The foreclosures still hitting large-profile new and conversion projects all over the city are still going through, prompting many troubled assets to slash prices by up to 25 percent. Toward the end of the year, starting from September, inventories started going down, buyers did come back, and sellers, for the first time in over a year, could reasonably expect to receive their asking price reasonably being the operative word.

What 2010 holds for us is still uncertain, but the end-of-the-year reports coming out of major brokerages should give a clearer picture, both of the current market conditions and of the mood of the industry’ players entering 2010. Stay tuned–and Happy New Year’s.

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