Wait, let me get this right..... Noah got a CONCESSION on his RENTAL.

No way! Perfitz said landlords aren't giving anything away!!!

Maybe the "bad financial situation" is in reference to the fact that he stated his job security is moderately stable at best. Price decrease isn't the only way to be in a bad financial situation.

I think Noah has said many times that he trends bearish for the short term. I am not sure what the gotcha is all about. In any case, even for someone who is wildly bullish (in Streeteasy, that means someone who thinks prices are/will be stable for the next 2 or 3 years), the high transaction costs would make it very foolish to buy with a 2-3 years time horizon.
You gotcha nothing, try again.

w67thwannabe, sorry duuuude, this one is reeking of desperation. You're not supposed to SMOKE the tea leaves for God's sake!

Sounds like you would never buy or buy again in NYC. Why do you spend all day on this website? As a renter for life, why do you care whether others rent or not? It shouldn't make any difference to you.

"let me get this straight, how does "bad financial situation" in 2-3 years jive with a "resilient" mkt? So ppl buying now, making a good financial move" As long as they don't care where NYC RE will be in 2-3 year or forever?"

w67thstreet, I wouldn't conflate the financial situation of one individual with that of the general populace.

I think you are the reader. You like to read yourself in print. Kind of like the blowhards that like to hear themselves talking. I am not sure....do you think it is better to rent or own in NYC?

bob - w67 works managing his family's real estate holdings. in '06/07 daddy realized that his son, like so many before him, was incompetent and likely to take the whole shebang down. so daddy told him to sell a couple of building so at least he'd have something to show for his decades of work, and now w67 thinks he is a real estate genius.

when you realise that is the situation, it is quite apparent where his persona comes from.

on the positive side, he has enough self awareness to realize what he's all about and that his wife is likely to divorce him, and at least he's smart enough to think about protecting himself for that inevitability. i will give him credit for that.

well there is some mis interpretation here. I thought I was clear that for me, I cant afford a property that meets my familes needs, which would be a classic 6 or other similar unit that I can grow into and not out of over the years.

Second, my job security is not stable. Its dependent on sales and commissions and I have to admit to myself that I dont have a regular job that pays X annually with a bonus at year end. So, that brings my comfort level down a few pegs. Combined, I simply cant afford what would meet my needs - what do classic 6's sell for now? 1.5M? 1.8M? 2M?

What is needed for down payment? What will be monthly obligations be?

When I say I dont want to put myself in a bad financial situation, I mean I dont want to stretch to buy something that I simply cannot afford. Do people do this? Yes? Do they do it as much as they used to be able to? No, not with tighter lending standards.

But I believe you should buy to own for at least 4-5+ years, and over that time frame, I need space for a growing family. So for me, it doesnt make sense.

How does a personal rent decision have anything to do with talking the market up or down? If I could afford it, I probably would have pulled trigger if I found the right place in the past 4-8 months. But for me, the decision is clear. I bought in late 2001, closed in April 2002, and sold in July 2006. So its not like I dont know what its like to buy and sell in this market.

But even that purchase was a bit beyond my means and we had to rent out for a few years at a slight monthly loss to keep the property. Life is a big lesson. And I learned a big one there. For me, Ill choose to wait until the time is right for my family to make the decision to buy. And that means being able to afford a property I can grow into and meets my needs for 4-5 years, more stable job security, and a home that makes me happy to live in.

My personal decision shouldnt be generalized to the entire market of buyers out there. All of my buyer clients have very good reasons to buy and very solid financials to buy a product that meets their needs.

Man why so many posts on me today? Not sure I like it

Noah, maybe it's because you're not as bearish as in the past. Take it from SteveF, if you are not preaching gloom and doom, these guys immediately swoop in for the k-ll. It's called desperation.

Noah - makes sense. Taking information out of context + making broad generalizations + runnig further with it = misinformation.

Here's the thing, w67th: do you think those things will actually happen? I think more than a few people have either underestimated how much the government will do to help real estate values, or engaged in a protracted case of wishful thinking. I'm not saying these things shouldn't happen, I'm just saying I don't see them as likely given where we're coming from.

waverly, that never happens on this board!

thing is w67, those supports will be removed - AFTER the housing mkts and economy have clearly begun to recover. if you're waiting for that to happen before you buy, your logic is pretty backwards.
don't know about mtge deductibility getting revoked, though - i think that's a third rail that no politician will want to touch.

and i wouldn't be patting yourself on the back for not purchasing in 2003/04/05. you'd still be in better shape than if you'd rented the whole time. sure rents have been down the past 12-18 months, but they rose in the years before that, sharply. if you'd bought, not only would you have paid down some of mtge principal, but you'd be paying it off more quickly now. and you would've been able to re-finance at all time low rates.

i dont get it...what advice am I not taking but preaching?

I am not up in arms but you distorted what he said and I think his follow up shows that.

You are a renter, smarter and better off than everybody else in NYC. Enjoy it! Don't waste your time trying to educate the masses all day, every day on this site.

67thwannabe - Your one man gong show is getting stale. Funny for a while, I guess but sensing more bitterness than humor these days.

While the average American moves every 7 years - (is this a recent number - I've heard it quoted for 20 years!) I'd guess that the Manhattan coop owner moves much less frequently. And of course, the rent-controlled or rent-stabilized, rarely to never. Wonder what the real numbers are here?

Lofty, really an excellent point. It's a number that's used on this site frequently as well, almost without being questioned, but I'd guess you're right. (Most) People work pretty hard to get that Manhattan apartment, so I'd imagine many hold onto it pretty tight (which may partially explain the traditionally low inventory here).

spinnaker, took the words right out of my mouth.

w67th, I don't get the obsession with Noah, much less the liberties you're taking in judging his financial situation, thought processes, etc. It's creepy.

actually i think in manhattan the avg holding period is shorter - i remember hearing some broker on bberg radio a while back and she said that it was about 5yrs.
if that's the case i think its because it is very difficult for most young couples to buy a big enough place to last them - they'll move out when the family gets too big. maybe that's changing now as the number of families here has grown sharply in the past 10yrs.

Hey wannabe - better check the fluid levels on that spin machine. Best to stick to your own mumbo jumbo, interpretation ain't your strong suit. Wait, you're and ivy 4.0er?

"FWIW, I HAVE THE MONEY to BUY RIGHT NOW, but like Noah I chose to re-up my rental cause I too believe NYC RE purchase will not keep up with transaction cost/carrying cost (including capital loss) vis-a-vis renting.. .m'okay"

What Noah said:

"If I could afford it, I probably would have pulled trigger if I found the right place in the past 4-8 months."

well I appreciate the words but I would never claim to be the commander of the market. I rent for a number of very good reasons, and one of them is highly personal after a family situation I had to deal with that I will not share here.

If I were in a stronger position financially, there was at least 2 places that I would have loved to buy over the past 4 months, but was not in a position to do so. I wouldnt look at my renting as a sign of where the market is heading or not. It was just the right decision for me and my family given where we were at time of the renewal.

Like many, if I had the means to, I prob would be a new homeowner again for the 2nd time. Sucks to admit, but it is what it is and there should be no shame in making a clear decision that doesnt put you in a bad position later on. I know many people that did that, even after they got a good deal.

You could have bought for 1M, sold a year later for 1.1M because you couldnt afford to live there, and got killed on transaction costs taking a loss on the property in the end and paying 1.5x or more in monthly costs as opposed to what you would have paid to rent a comparable unit

Aboutr will smack me for asking this again, but ...67 and others how do you explain the case of Wmburg: although two buildings in bankruptcy it doesn't seem to have spooked the market, and despite many heated doom posts earlier this year that Wmburg was going to basically be Miami on the Hudson..you have the two biggest developments discounting only say 10-15% off prices set at the peak (when they thought they would be benefitting from the yuppies hordes priced out of Manhattan), when people say Manhattan is down say 20%), and 70 berry sold out, 69 sold out, 72 sold 15 out of 38 in three weeks (they say), 60 people were there (per the doorman, not the broker) at 125 north 10th one sunday I went.....just curious, how the wmburg scenario fits in all this...

I know it takes time for a crash to play out, but on the other hand, the crash is the accumulation of small events and it is worth noting what is happening along the way.

lol - with that said, I did sell my place in 2006 because of where the market went from when I bought and the toppy feel it had to me. Ill say when I sold, I wanted out! Sure there may have been some upside left on the table, but the trader in me likes to sell on upticks

wow another lie told by somewhereelse aka EddieWilson aka NYC10022.

Hey tool please post the link where I said that quote.

Noah, I think the bears see you as a market-maker, and since you toned down your bear stance, you are now a target.

I see the logic of the bears, and I certainly think prices in NYC have bubble-like idiotic qualities, but what worries me is whether enough dumb people can carry this greater-fool thing on for a while longer, albeit at today;s nowhere-near-enough-reduced level.

maly - well I have to keep it real. cant deny the market. I always tell people, Im not a perma bull or perma bear. Im bullish when there are reasons to be bullish, and bearish when there are reasons to be bearish..and in between when Im downright confused after an expected move occurs.

Adapting at the right time is an ongoing challenge I try to nail down.

Thanks

Jimstreeteasy, I couldn't agree with you more. My husband and I looked high and low, all over the tri-state area for a family-sized place, from 2005 to 2008. We found nothing that even came close to make sense, yet those places sold. Between this experience and Bush's solid re-election in 2004 (dear God, what the fuck is wrong with you people? Hasn't he wrecked this nation enough already?), I have lost my faith in rational behavior.

Here's my take. The day UD over-streches himself even though he may not be able to afford it, that's the day I'm buying.

"and i wouldn't be patting yourself on the back for not purchasing in 2003/04/05. you'd still be in better shape than if you'd rented the whole time."

Yeah, keep telling yourself that. Given that many apts I've seen are trading at 2004 prices, the fact that you'd lose 10% in transaction costs if you're upgrading now, and the fact that your annual nut after-tax amounted to you paying 1% more per year than renting (even at old rents and prices), you're down 15% of purchase price, or 75% of your oh-so-conservative 20% down-payment. If you're not upgrading, you're only down 25% of your 20% down-payment.

You gotta go back a couple more years to still be in the black, unless you've got blinders on. See the thread about how RE losses are rationalized away...

Many a time I have found myself on the residential buying ledge with the now or never thought running through my cortex. This is a time to buy. Prices are much better than they were and rates are low based of historical averages. Time will tell if 2-3 years from now produce change. Clearly w67 believes that the time frame will yield tangible results. I pray that he is right because that is my new time frame. The wild card is the specter of inflation and it's impact of prices across the board. Rates raising in theory should drive down the price of RE but, I would have trouble backing that claim with empirical evidence. What is the impact on RE in the face of $6/gallon gas or a dozen eggs for $8? In the presence of wage increases will this not take RE with it? Perhaps there will be no change in RE when you adjust for inflation but, that doesn't mean the dollar cost will not elevate. This is the Govs big game. Keep the printing press running until RE stabilizes. Was there another plan that I missed?

jim, I don't see things quite as bleak as aboutready. I do not see any real chance of appreciation in the area any time soon, but I don't expect a "sh!tshow" either (the word smacks of a bit of sensationalism for me, but no biggie). I think we'll see basically what's been going on the past few months continue for a few more years. A few buildings will go belly up, while others will do quite well - it all depends on the developers' actions and the loan terms (and ability to refi if needed). Those are very hard things to predict, no matter how much you follow the market, of course. One of the more encouraging signs, to me, is that there isn't much (if any?) groundbreaking on new construction, but many developers are actively working to complete projects already started (144 North 8th, 2 large rental buildings on North 12th/Berry, etc.). This will likely help absorb some of the very high levels of inventory out there. But as I've said many times before, it's a good time to be looking if you're serious, but there is absolutely no reason to rush into anything, in my opinion.

Interesting to hear different views.

By the way, since I started talking about Wmburg, it seems pretty clear that the whole area betw bedford and the big high rises will be totally different places within a few years, and will seem more attractive to the well-heeled types who will be buying into developments. I mention this because bringing in hundreds of new residents does have benefits. (I know ..i know...it won't be as hipster authentic..but hey...such is life)

Noah NYC real estate broker = 100% dependent on finance industry in NY. Ergo, not only is your logic correct, but you are thinking like most everyone in finance who didnt already get sucked into buying between 2004 and 2008. Prognosis very bearish.

cc,
did Governor Magoo change his plan to delay the checks to nys schools?
When I last tuned in, districts would be in 'do with-out' mode for 30 days.
I don't think this is an unreasonable plan given the dire condition of the state budget.
I also am in favor of the license plate scam. Want to own a car in NY? Want to drive on the roads? Want the salted in the winter and patrolled by state and local police? Would you like your roads with or without holes? Then pay the hell up! I wouldn't even give you a new plate, I'd give you a sticker for $90 and tell you to stick it to your plate. At this point I'd do just about anything to raise money for the state as opposed to continuing our borrow and spend policy. What about a tax on auto-erotica. Don't they make some sort of bracelet or cuff that would allow charges based on usage? Boys 14-23 could save our fiscal condition in a matter of weeks. internet porn + adolescence = tax revenue!
Embrace the synergy!

Rents are a bargain. Enjoy it. Buy when prices fall or rents rise, or both. The only reason to buy right now is to not give a shit about overpaying. In other words, there is no reason.

About, I haven't read the Forte thread, but I think you misunderstood my point, or assumed it was more general than I intended. I'm not even super enamored of Wmburg (I like the low density, low noise, and proximity to a kind of cool area, mainly but I worry that there is too little of what people talk about so much) so I ain't in a non-objective swoon.

My point was : People on threads have often stated that the area between Bedford and the river is bleak, nothing there, and things like that and I think that is very short sighted. It is just plain common sense that hundreds/thousands of affluent new dwellers will lead to more retail/lifestyle infrastructure of various kinds, and it will look different, and be more attractive (again, to yuppies, not hipsters). At that point it will look more attractive to affluent people in a way that they cannot imagine when it isn't there. And by the way, this isn't going to be a fad, that can fade away, because those buyers aren't going away. The unit prices may already be high enough that this is already priced in. I don't know.

Aboutr, I also do get your point about expanding area of "standardish" purchases. I think that's a nice way to look at it, actually.

I'm interested to hear what you say about the EV. You mentioned new developments. Well, I was simply shocked on my little Sunday of open houses a month ago at 4 and 6 floor walk-ups at a 1000 psf..I said to myself , 'this market is still nuts, be careful."

Be fair. Should any broker admit there is no reason to buy. The only reason to buy right now is that you really like something specific and you dont give a shit that the math does not work.

If you have a small mortgage and/or you never need or want to sell... then you dont need to cover losses. It seems once you desire/need a certain space, it becomes tough to find the right rental. Also, sometimes people I know (and almost me) just cave to their wife's nesting instinct. There is something nice about owning. Its a shame an epic credit bubble made prices stupid for an unusually long period of time.

About , to be clear what my point is. I think the issue in the Bedford to river area forwmburg and environs is kind of like the 13th st/14th st area in DC -- once you put in enough yuppie dwellings, and they buy it and live there, it aint going back to ghetto (several areas）. Now, the degree of transformation , just how pricey or fancy, will depend on lots of factors.

I think FIDI might fall into the same category, but walking around down there a little, it seems like it isn't clicking, so maybe there aren't enough buildings to make it happen.

Now I think LES AND Harlem are different propositions (correct me if I am wrong) but in those places the sheer number of new units is not significant enough in themselves to cause neighborhood transformation.

Okay thats cool. Manhattan didnt go back to 70s style ghetto in the 90s but it still fell 40% off a much less ridiculous high. What is your point about Billyberg?

noah could afford to buy in 2001, but can't afford it now in 2009. this is in spite of the fact that 1) his business has likely grown since then and 2) he banked a decent sum of cash from the 2001 to 2006 run-up.

hmmm...

Rhino..lol...It was an observation about the transformation of the area (to me the point is obvious, but plenty of threads have had people saying its quite the opposite), NOT an argument about price.

Rhino, since you're on...why isn't Bburg tanking more in your view?..

I bet Noah can afford it...but he's not confident enough in the market to be confident enough in the value and his income stream. Its a bearish datapoint. If we were either down another 30% or out of the woods economically, he'd probably buy....But he's sitting pat for all the reasons that everyone else should too.

I am not close to the Billyberg market. But can "not tanking" simply mean transactions are not happening because sellers/developers are scared to accept the real market prices of their properties and/or hoping those market prices recover soon? Is the Solera in Riverdale "not tanking" because the developer did not accept the bids it received? Thats denial, not a reflection of the real "market clearing" price.

"But can "not tanking" simply mean transactions are not happening because sellers/developers are scared to accept the real market prices of their properties and/or hoping those market prices recover soon?"

That has been precisely my view, and I have called it sort of rose-colored pretend-thinking...but..in some of these places it seems to be working. Units are selling. It's hard to generalize, I suppose, but so far, it's pretty clear, I think, that things are not nearly as bad as one would have thought. Of course, a sign of how wacky it is is that a nice building -- w11-- is shuttered...and another one is bankrupt...while others not far away are selling out..

Units may be selling...but how many units are left and how far away is the real market clearing price?

Check the 70 berry thread. The Edge is another story..huge and only 33% sold. Aready, who knows how to sift through this stuff is going to weigh in..i hope...(hint hint)...

I dont know how we can figure out what the right price is when certain building sit 60% empty. Its a tough one. There has never been a luxury condo market in Williamsberg until we enjoyed an epic credit bubble.

Rhino, I understand your point. But, to be fair, the very premise of your point is that Wmburg as a condo development destination is the poster child of the nyc real estate bubble, and many, many posters on SE have said that, but so far it doesn't seem to have imploded.

I guess to me you cant say it hasnt imploded when certain buildings are 60%+ empty. To me, whether or not it has imploded remained to be seen when we see the price at which those units can be sold.

HFS, how have you ever added value to this board?

hfs...what's your outlook on the market?...L train congestion...and the like

"then it begs the question WTF is up with FHA giving out FHA 97% loans as fast as geitner can run"

FHA gives out 97% loans to slow the crash, have people "suckered" into buying now, just as the Fed buying agency debt takes down the interest rate.

Slow decline means people will pay their losses over a decade rather than tomorrow, won't even realize they are losing money. People buying will take over future losses of people selling. The alternative is fast decline. In this case, more will be forced to walk away because more will be underwater (have to move, can't pay), and more will strategically default: if you're down $300K, you'll walk; however, if you lose $30K a year, you'll keep thinking "Next year will be the first year of the rest of my life and things will turn, I'm sure!" That is policy, and probably the best policy in the face of crappy choices. Alternative is that rather than having the homeowner dropping that $300K over the next decade, the bank will need to drop the $300K tomorrow, which means John Q. Taxpayer will need to take the $300K hit because bank doesn't have capital to absorb a $300K loss.

What's not to get?

"what gives anyone else the "right" to leverage up 97%"

'cause they can afford the monthlies at the moment living month-to-month and nothing changes for the next 30 years. What more do you need, silly?

hfs: friednly advice - be careful taking on Rhino. his ego is as fragile as it is large and he has a temper so your in for a fistfight if you start on him. you'd be fragile too if you used to be a sellside equtiy analyst. those guys have as much blood on their hands as RE borkers.

anyway much easier to pick on the fat lady. it's almost not fair how easy a target she is.

CC: how do wages go up when so many are desperate for jobs? supply and demand would clearly indicate no wage increase. we have also seen the impact (18 months ago) of big increases in gas prices. people slowed purchases for the first time ever. inflation may make sense intellectually but other than government related costs there is no evidence of it taking hold. and, it is hard to see, how the govt can impose significant tax increases.

AR: falco, as long as your wage remains constant in terms of inflation, you'll be winning this game. not only is unemployment at whatever, but the unsung crisis that is occurring (although not to some, they welcome it) is the wage deflation. factor in benefits, and the picture is lousy with long-term wage deflation. a couple trillion dollars pumped into the economy and STILL deflation. despite commodities. and i like how all the "analysts" just started calling for food inflation again. right, like all the little people in emerging countries have extra wealth during these times. remind anyone of the oil calls?

______

I could not agree more with these statements. For all the talk about inflation, it ain't gonna happen with all the slack in the system (which some believe) will result in a chronic, structural double digit unemployment rate in the US for YEARS.

People are confused. They think dollar deflation necessarily means Manhattan rent inflation, when all it means is higher gold and oil in dollar terms.

Newman, et al, its funny to me how all you random detractors crawl out from under the sink. Find a fuller life (or a least presence on this board) than to attack me at random for something Steve has long since accepted an apology.

NYC should secede from NY state. We subsidize the whole damn state, then people commute in and use everything and pay what 1% of income. Doesn't seem balanced.

There was a great New Yorker cartoon in the 70's when NYC tried to secede - spearheaded by Normal Mailer and Jimmy Breslin. The cartoon was two guys in suits walking down a city street and one saying, "Of course we'll be called New York. Let the apple-knockers find another name." Always loved that.

Norman Mailer. Anything but normal. lol.

another great thread, threatened by utter banality.

Sorry. You're right. noah has a right to buy or not according to his personal situation, as do we all. he doesn't have an obligation to live out any norm or prediction.

The only interesting thing about this thread is that if Noah were an advisor, or an uncle, he'd probably tell you not to buy right now. However, as a broker, he "appreciates" why some people would like to buy. The lesson is, your broker is not your advisor, or your uncle...

that is right, I am not my clients uncle

thanks lofty!

As their broker, are you their advisor? This is the age old conflict of brokers.

you mean financial advisor? or advisor of when to buy, etc..

I always make sure clients know I am NOT a financial advisor. Never ever ever.

Im pretty clear with all new buyers, as I do not work for sellers anymore, that the meat of my consulting is property valuation, comps analysis, bidding strategies, negotiating strategies, education on the buying process, what to expect, etc..then I tell them what I love doing which is analyzing the market to understand where the market seems to be trading right now, where are bids coming in, where did we just come from, etc..

Very rare that I give a concrete prediction as to short term. I did that once in July 2008 when I published this article on urbandigs.com - I sent a note to my clients saying I expected an adjustment, but I didnt know what would spark it, when it would happen, or how long it might last. Only the dislocation I saw between credit markets and trades that were taking place right near peak levels still at that time:

http://www.urbandigs.com/2008/07/low_ball_bids_cold_feet.html

I think the post talked for itself at the time when trying to tell readers what I saw in the markets in terms of the bids and buyer psychology. The stuff before then got well into detail on the credit markets