Have things changed that much?

"So... what's so different about 2007 vs 1997 or 2002?"

George Bush is still president.

Are you the same person who said the same thing about nasdaq in 1999?
Prices going back to 2004 levels so unrealistic? that would be a 30% drop for some folks!

dow and overall market(broader) went to new highs 5 years after 2000-2002 bear market. The overly hyped Nazdaq did get hit and hasnt come back. However I would equate dow to New york city(manhatten) housing. Las vegas, Miami would be like nazdaq. The city could take a hit, but if you are in for long term you will be ok.

how did you did on the 210k studio - how much is it worth now?

I wish that these real estate forums had existed in 2001. (perhaps there were some but nothing I was aware of) I remember just hearing people talk then and then particularly after 9/11 people were absolutely certain prices would crash completely and that certainly BPC properties would be just about given away. Now none of us knows for certain what will happen with the market but a longer history of online hysterical commentary might put things in perspective.

OP, buy if it makes sense to you for the long term. You don't know where prices will go but if you need a place to stay and know you'll be there for at least a few years, than do it.

Consider yourself lucky that you bought in 2001....i didnt buy in 1996 and again didnt buy in 2001....so, you must have done well on the 2001 property since its doubled since.....

I was looking at a real estate article from the early 90s in New York Magazine online, I think, & the prices on the Upper West Side were shockingly low, a couple of hundred k if I'm not mistaken. Also what about that Dr. who blew his house up right off Madison not that long ago. Didn't he buy in the eighties for about $435,000 & it was worth about $4mil & then sold post demolition for maybe twice that. (I KNOW I read that in NY Mag.) Buy a good place & hold it for a while & you should do well.

I'm an owner. With that said, NYC salaries in general have not kept up with the real estate price increases. Eventually, something's gotta give.

OP here... the studio is worth about 350 now, I think.

I agree fundamentally with #10. I dont know if something will give soon, but I do wonder how much income you need to live in Manattan nowadays.

"So... what's so different about 2007 vs 1997 or 2002? Why are the market correction proponents right now, when they were wrong (imho) in 97 and in 02? Please be as specific as possible..."

The number one difference is that we are in the midst of an unprecedented credit and liquidity bubble. This easy credit/cheap moneyhas driven up prices everywhere, including New York. Those who said things were too expensive in '97, '02, whenver could not reasonably have predicted that the Fed would take interest rates to a negative number in real terms and keep them there so long commencing after 9/11. Prices may have gone up regarldess but not to the extent we have seen in the past 5 years. without that environment

While NY has its own local drivers, this liquidity is a huge factor here as it is elsewhere. We are starting to see cracks in the credit bubble now. The extent to which it will affect NY is uncertain. But if we see significant credit contraction it is likely that NY will be affected (not to mention the many ripple effects that could occur if that cotnraction drives the national and/or local economy into recession).

Just some thoughts...no shining insights....

1.) Incomes in many areas have not kept up with real-estate prices. TRUE, but there's still really high incomes in the financial arena/Wall St.

2.) If rates go up, you will be able to get less for your money. TRUE, because you won't be able to borrow as much.

3.) Who will be able to afford real estate then and will prices have to drop if rates increase? Well, only those folks in the high income areas will be able to afford current rates for someplace livable.

4.) How long and to what volume can that particular financial group prop-up the real estate market in NYC? Don't know!

For #6, not quite 2001 but Oct 2002:
http://discussions.realestatejournal.com/RealEstateJournal%20Discussions/1

The thing that has changed is that prices are up 300% in 10 years. This is UNPRECEDENTED - and prices are completely out of line with what they should cost according to the rents they could fetch. The real estate mania is actually ending and prices have already started to fall - this is what is different.

Pricing is up 200% in ten years..but what does that mean. your apartment is worth 1,1 million but your not selling so what does it mean it your not moving.

It means more for those folks who bought at the top of the market - if the market tanks, they've just lost a huge anount of equity and could be under water. This would be very, very bad. It's not that these folks would walk away, if they bought in a COOP, they certainly had ot have sufficient reserves, it's just that they would lose a ton of money. Maybe it's just me, but I take little pleasure in watching people lose money. For the folks on this board who WANT the market to go down, I'm just not getting you....you want people to lose money??? Are you so jealous that others could buy when you couldn't that you wish people ill will?

#17 Who fault is it if someone overpays for something? It has nothing to do with taking pleasure in watching other people lose money. Jealous? hardly, their are plenty of people who waited on the sidelines because they thought prices were insane, even though they had the ability to buy. Buyers created a bubble with their reckless spending sprees and now they just have to live with the possiblity this delusional market is on its way down.

Well, sadly there are some mean spirited people who post here. I'm with you, I wish the best for everybody. I do get a whiff, now and then, that Manhattan is turning into a rich man's playground. True working class people find it very difficult to live in Manhattan; how could they not?

#17 - Read your own words..."fault, blame, reckless spending sprees"..pretty harsh. You clearly DO take glee in watching those "reckless spenders" lose money. By the way, I did not buy in the bubble, but I'm not one once happy that those folks who did buy may lose tons.

I am not #17, but it is the fault of those who buy in this crazy market if they do not do their research - at these prices most people will have most/all of their savings tied up in their multi million 1 bedroom apartment - they know it is crazy and so does everyone else, but they do it anyway? Why? Think people.

17 here----- #20 It's somebody else's fault when a gambler walks into a casino and loses his money? I am not the abusive father who created the addiction in the first place by traumatizing someone. How about a little self responsiblity? If you can afford to buy a 1MM-10MM condo or townhome, you're a big boy, don't expect sympathy from others.

If you want to live in Manhattan & many people currently are tied to the area with their work, you're in a catch 22. If you rent you watch your rents escalating & the money going into somebody else's pocket or you agonize about buying & the prices are stunning. Nobody has a crystal ball so nobody really knows what tomorrow will bring. Chill, people, chill.

The big chill in the market is coming #23.

You make it sound so omninous (23), like people have to buy in Manhattan in order to get to work. Poor helpless victims, they have to live a 5 minute walk from their workplace. I wonder how all those other masses of people that take the LIRR or MetroNorth make it. Those trains after all are cattle cars.

maybe, maybe not. If the apt you wanted dropped 10% would you get in? 20%? There are so many buyers still on the sidelines that there's support.

There needs to be at least a 30% drop so everyone can learn their lesson about the price of speculation.

so are you a buyer at 30% then? If so then maybe other buyers will come in at 25%... and others at 20%... you may not get what you want then.

The problem with these boards is you have ppl with no assets trying to tell ppl with actual assets what to do. They don't understand diversification, because they have nothing. Once you have money, you have the problem of what to do with your money.

To those who are saying people were "reckless" and "speculative" to buy into Manhattan... I dont understand!!! We are not talking about a spending spree where you go out and buy a $600 pair of boots... we are talking about living, lifestyle, etc. I have friends who have moved out to the burbs. ALL of them HATE the commute. Sure, they have a 4 BR home with a huge yard. They also spend 90 minutes each way commuting. Thats 15 HOURS per week on a train. How much is that worth? What if you have a child? If you leave work at 6, you get home at 7:30 and your kid goes to bed at 8:30. Wonderful family time.

OK, so you want to live in the city now. Do you rent or do you buy? I dont think anyone jumps into a million dollar purchase "recklessly" and without lots of thought. But the alternative is to rent. One which over the past decade has CLEARLY been the losing proposition (unless you got some rent controlled $250 2 BR deal of course).

30, exactly. Not to mention you don't have to buy a car (or two) and maintain them. The doubters are most likely single and if not, do not have kids.

Brooklyn isn't a 90 munte commute. Queens isn't a 90 minute commute. I think kids want a house with three times the space of a co-op and a yard.

Just a bunch of sob stories of what a struggle it is to live in Manhattan.

The price of living in Manhattan isn't the price of a commute, its the price you pay to feed your egos so you can think you are better than everyone else in the surrounding boroughs and counties.

How many years ago did they build the 7,E,F,G,R,A train lines? and Manhattanites still havent figured out where they go and how long it takes to travel on them?

#32 and #33. I think the boroughs may be better off without an exodus of people flooding the market and pumping up prices even more by overpaying for property. It is already hard enouh for working class people to afford a home in the city. It would bring people with a completely different way of valuating real estate as trophy properties instead of places to live. The only exodus the boroughs need is artists and other creative types, people with real culture, not a bunch of snobs.

hey, to those of you that love queens... please explain to me why as you head south towards Roosevelt Ave, the cross streets are 34th ave, then 35th ave and then 37th ave. what happened to 36? cant you people count?

LOL.

I grew up in an apt and want no part of a house. Shovelling snow? Mowing the grass? Your kids want to do those things? I respect your right to want those things. I reserve the right to visit you (or someone like you) and temporarily share all that space with you, for a day or three. But I want to be where I can get a taxi if its 2am and I want to be home in 10 minutes.

How long is the commute from Bay Ridge? Sheepshead Bay? Fresh Meadows? Maybe not 90 minutes, but certainly over an hour (depending on where in Manhattan you need to go, of course).