Question: My husband and I live in Los Angeles and love New York. We travel there one or two times a year, sometimes with home exchanges, sometimes using HomeAway rentals. We’re retired now and would like to buy a pied-à-terre in Manhattan, preferably on the Upper West or Upper East sides. We have about $650,000 to spend. Should we sit on the money for a while, waiting to see if prices go down over the next year, or should we buy ASAP? Do you have any thoughts on when and where to purchase?

— Looking East

Dear Looking:

What a great plan!

I’m going to answer your question in two parts. Here, in Part I, I’ll talk about when to buy in Manhattan. In Part II , I talk about where to buy.

Let’s focus on one really important matter first. In my experience, Manhattan real-estate prices are closely aligned with the ebbs and flows of Wall Street. That’s because Wall Street is here and because of the way Wall Street pays itself.

Depending on how good of a year an investment bank has, traders and bankers receive a huge chunk of their annual pay as bonuses, which are generally paid out in the first quarter of the following year. Simply put, 2017 was a great year on Wall Street, and this year’s average $184,220 payout was the highest since before the financial crisis a decade ago. Bonus money gets spent on everything from bottles of 2005 Le Pin Pomerol to, you guessed it, really nice apartments on the Upper West and East sides.

You needn’t worry about the top-grossing partner who engineered a giant merger and is getting $100 million, nor the first-year analyst who may get just a $30,000 bonus. No, your apartment-buying competition is a 30-year-old vice president with a few hundred thousand dollars burning a hole in his pocket.

Don’t go there. Don’t get into bidding contests. Wait for a bad year in the market. That’s when bonuses shrink and VPs get laid off. Good news for you: 2018 is looking lackluster, at best. The Dow Jones Industrial Average is down for the year. While the dollar value of U.S. corporate mergers this year is way up, the actual number of deals is way down. That suggests there will be some really big bonuses going to a few people in 2019 but not so much for everyone else.

So where does that leave a non-Wall Streeter apartment buyer? Watch the stock market. If it continues to deteriorate through the summer and into the fall, late this year or early next year might be good times to make offers.

Your timing could make the difference between landing an alcove studio or a full one-bedroom.

David Crook is a veteran journalist and author of The Complete Wall Street Journal Real-Estate Investing and Homeowner’s Guidebooks. Do you have a question about anything real estate-related in NYC? Write him at For verification purposes, please include your name and a phone number; neither will be published. Note: Nothing in this column should be considered professional legal advice. If you have a legal issue, consult an attorney.

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