Time picks up DB NYC down 40% meme

It's old news for us but this article has the benefit of targeting a wide audience.
What's important is the consensus gets the message: DO NOT BUY NOW! You will regret it and WILL BE underwater!

exactly.

No, what's important is that sellers get the message to cut their losses faster.

"What's important is the consensus gets the message: DO NOT BUY NOW! You will regret it and WILL BE underwater!"

That's insane - you really think you can make a sound decision in 12 words for the entire general population? This is no different than petrfitz' "everyone should buy now" recommendations.

Other media outlets will pick up the same storyline, and the sheeple will follow. Yes. Everything is different from petrofrizz's recommendations ... they're, um, unique. He's special.

down 40% off list is about right. It will bring us back to 2003 prices, at least on properties i am watching.

but nyc region already dropped 20%...is this another 40% on top of that 20%? and when exactly will this happen...article doesnt go into that..

dead cat bounce in progress

I link to the article in the hopes that YOU WILL ACTUALLY READ IT

"40.6% from the prices that prevailed in March. "

not to be a jackass but: quite a difference from reported march closings (i.e. nov/dec 2008 deals) and actual deals made in march about which we still know very little.

so we are saying 60% total decline from peak?

40% plus 20% does not equal 60%. Try doing the math.

Its 52%......but wasnt clear on how the article was stating it.....

Ah, gotcha. Sorry - that percentage calculation error is a pet peeve of mine.

I'm waiting to see the Q2 reports or some intel on March/April closings before I make any statements about the market.

this report is such garbage. Prices are not falling 50%.

i agree...also, i think the market (to the extent that there is a functioning one) is going to be split into many different segments based as much on the unit itself as the status of the seller. unemployed seller is going to react very differently than employed seller. new dev will be very different based on percentage of units that have closed, estate vs. renovated and on and on.

> This is no different than petrfitz' "everyone should buy now" recommendations.

Except for the small issue of, well, being right.
;-)

Seriously, there is an INCREDIBLE difference between overgeneralizing a mostly true statement, and something that was just horribly stupid to say.

conforming vs. nonconforming loans. the Q2 reports will likely grossly overemphasize the downturn.
info on the March/April closings are coming out. i'm amazed at how few closings are showing up in recorded sales. even if there's a delay, there should be a certain volume.

I'm just so bored, waiting for clarity. For the areas I'm seriously watching, new inventory has been trickling in but nothing really interesting has come available for weeks, and watching the really expensive stuff is entertaining in the abstract. At least the Q2 reports would be some real data that we could slice and dice and argue about on concrete terms. I'm also beginning to think that my realistic and ideal price points in the areas I want aren't actually going to decline much. So now I'm starting to think about which areas might de-gentrify the hardest, yet still be worth buying in.

"entertaining ONLY in the abstract" - sorry.

evnyc, where would be your dream location, and apartment size/type? i'm FINALLY seeing some real movement downtown (not FiDi), but still almost nothing is trading.

AR, it seems like it is taking a lot longer between contract signing and closing than in years past. Part of this is large refi volume and the other part is banks decimating staff that process loan originations. We may have to wait for 3Q closings to start seeing april/may signings. i don't think things had picked up by march.

co-op sales will take a long time to appear in the reports. Condo sales should, however, appear in the 2Q report.

i still think, based on what i've been seeing, that the numbers will be skewed. alpie, almost all of the closed listings that i see are for coops, compared to last year.

special_k, also, i think a not insignificant number of those in contract will not make it to closing.

AR, can I have six dream locations?

Realistic: large 2-br/2-ba in Brooklyn Heights, with reasonable-to-low maintenance, preferably outdoor space, not by the highway, $600k or under. I'm watching a lot of places in the area, but they either have significant flaws, go into contract before I can even wheedle my significant other into going to the open house, or sit on the market at $750-$800k. And sit. And refuse to cut. For months, and then often they disappear from the market. Transportation is really important to us, so the question then becomes, how close to Atlantic Avenue do I want to get? Answer, not very.

Idealistic: Large 2-br/2-ba, with reasonable-to-low maintenance, preferably outdoor space, on very specific blocks of the East Village (certain blocks of 5th St., 9th St., 10th, maybe 12th, or Stuyvesant St; or in Battery Park City if we could just resolve the land lease issue, for $800k or less. I'd also consider Tribeca in the "idealistic" zone.

I'm watching over 70 properties, so it's not like I don't search. I just don't see big price cuts where I'm looking, so then I start thinking, well, the UES and the UWS aren't so bad.

Also in my low moments, I start thinking that Flatbush or East New York can't possibly be as bad as people claim. People live there! Then I shake my head and think, yeah, but you can rent a nice enough place in Manhattan.

"special_k, also, i think a not insignificant number of those in contract will not make it to closing. "

given that a deal with a mortgage most likely has a mortgage contigency, i'd have to agree.

nothing personal against flatbush or east new york, but rental is definitely preferable. keep hope alive. your price point is definitely being juiced by the conforming loan market. pressure will come from above in this market. start following properties in the $1.1-1.3 range. When they start declining they will crowd your target market down.

"not to be a jackass but: quite a difference from reported march closings (i.e. nov/dec 2008 deals) and actual deals made in march about which we still know very little."

Maybe you meant -- not to be in denial? You can only stay in denial for too long though. :)

Maybe. I sort of wonder if things will just stall out and bump along for a while. So many people were priced right out of the so-called "starter" apartment for most of young adulthood, and 1-bedrooms are just not going to work for them, so I think there's more competition for the 2-br market than for other segments.

"the Q2 reports will likely grossly overemphasize the downturn. info on the March/April closings are coming out. i'm amazed at how few closings are showing up in recorded sales. even if there's a delay, there should be a certain volume."

Do you mean march/April contracts?

wasn't clear. i meant our discussion of the recent closings. evnyc said she wanted more info from the march/april closings. i realize the march/april contracts are still unresolved issues.

evnyc, demographics. they're not going to work in favor of this housing market.

Yeah. Wish my parents had waited about five years to have me.

REO and AR, yes, I'm waiting to see what the closing numbers look like from early spring (I don't care much about specific dates, per se). For my price range, I don't think there will be a large drop registered. Low volume, sure, but I'd be surprised to see anything else.

"co-op sales will take a long time to appear in the reports. Condo sales should, however, appear in the 2Q report."

Since Coops are now recorded in the same way that Condo sales are, why would this be the case?

because it takes longer to close on a co-op due to the board approval process. So a condo that goes UC in May will close faster than a coop that goes UC in May.

"wasn't clear. i meant our discussion of the recent closings. evnyc said she wanted more info from the march/april closings. i realize the march/april contracts are still unresolved issues."

Several comments on this:

1) I'm not so sure there is such a universal lag as people seem to be thinking. look at the splash page for SE and "Recent Recorded Sales"

305 East 24th Street #17-K : went into contract 3/19/09; closed 6/9/09; recorded 6/15/09
465 West 23rd Street #3I : contract 4/5; closed 6/8; recorded 6/11
1 Irving Place #P15H : contract 5/6; closed 6/5; recorded 6/17
90 Guernsey Street #4 ; contract ?; closed 6/5; recorded 6/10
205 Third Avenue #8T; contract 3/24; closed 6/9; recorded 6/16

Aside from the Brooklyn sale, all 3 out of 3 Manhattan sales look "normal" to SHORTER than normal

2) We heard about all this "increased volume" of buyers looking and buying as one of those "green shoots" back in March/April (or was it earlier or later than that?). It will be interesting to see the veracity when the closings come, and as per above, I don't think it's as far out as a lot of others seem to think.

so...what do you think? nowhere near as many closings as are reported in contract?

"because it takes longer to close on a co-op due to the board approval process. So a condo that goes UC in May will close faster than a coop that goes UC in May."

Ah. OK, I think "we" all need to start being more clear when we use the word "sales" as to what we mean (contract, closing, etc.). Although I will point out that:
a) if you are talking about a new construction/conversion sales, it's quite the opposite, and by (potentially) a HUGE amount), and
b) Condos still need to waive their right of first refusal, and as time goes on I'm seeing more and more Condo Boards making buyers fill out purchase application which look more and more like Coop applications, and taking loads and loads of time to "turn them around", even if there's no way the will exercise their right of first refusal. in fact, what some boards are doing is trying to "reject" buyers by sitting on their packages till their loan commitment runs out in hopes they (the buyer) will exercise their rights to cancel the contract and "go away".

"so...what do you think? nowhere near as many closings as are reported in contract?"

Well, I'm not so sure we saw a lot of numbers on units which went into contract, just lots of anecdotal evidence by brokers (probably truthfully) talking about their own personal pick ups (like Noah: I sincerely doubt he wasn't being 100% truthful in his reporting of the pick up in HIS business). But the problem with anecdotal evidence is that 'average thing" again: you only hear the anecdotes from ONE SIDE: the one's who are doing better. I'm sure there were plenty of brokers who did DEAD ZERO business, had dead zero traffic/calls, etc. But THEY aren't going to go shouting THAT part from the rooftops the way that the one's who did better did. So you end up with a skewed idea of what was going on, because you only heard the stories you were "supposed to hear". It's sort of like Lotto commercials: they trot out all the big winners to display, but you never see a lotto commercial with someone saying "I spend half my paycheck a week on Lotto tickets but I've never won anything". So, just by looking at the commercials, you'd think playing Lotto was a winning proposition. And that's what they want to portray to sell more Lotto tickets. just like the RE industry wants to portray that things are looking up, more volume, prices not going down, etc. BECAUSE THAT'S WHAT THEY WANT TO PORTRAY, AND IT CAN BE DONE WITH ANECDOTES EASILY. Let's see what the truth is when the real numbers come in.

But also: for those contracts which occurred on new projects, we'll probably never know, because of the non-correlation of contract signing dates to closing dates. And of course the number of closing HAS to be less than the number of contracts, the only question is by how much.

what some boards are doing is trying to "reject" buyers by sitting on their packages till their loan commitment runs out in hopes they (the buyer) will exercise their rights to cancel the contract and "go away".

in your opinion, this is more of a condo phenom than coop?

It has to be (to a large extent, anyway) because the Coop Boards could simply reject for "any reason or no reason", whereas a Condo in exercising it's right of first refusal has to buy the unit. The only place I've seen it significantly different is in Coop Village (all the different Coops there) actually exercising their right of first refusal (and fairly often, too), where they have BOTH the right to reject AND a right of first refusal.