Does stock market up mean more stubborn sellers?

yes of course.

who cares? why would you chase an apt that clearly isn't really for sale?

most sellers dont have to sell. therefore you may call them stubborn but why would someone sell for a price they dont want when they dont have to sell? its buyers like you that are unrealistic in expecting dramatically huge price drops. there may be some out there but they are few and far between.

and most buyers don't have to buy....

than what?

petrfitz, you assume that I'm looking for dramatically huge price drops. I am not. My question simply asks if the mentality of sellers (real sellers) has become more optimistic with the rising stock market even though other macro indicators still point to a slow recovery. I have seen many properties with peak 2007 pricing which clearly don't make sense given the current state of the economy and obvious flaws with the subject property (such as in need of renovations, no view, limited light, odd layouts). My opinion of fair pricing today is somewhere between 2005-early 2006 levels. Also FYI, I am a very serious buyer. I am pre-approved for a jumbo loan and have 35% of my price range parked in savings waiting for the right opportunity. I'm not just wishfully shopping around.

Also take a look at some poll results on Real Deal about realistic pricing -- http://therealdeal.com/newyork/articles/results-of-poll-about-property-pricing.

cc..NO buyers have to buy, SOME sellers have to sell. That's what drove lower prices on 75% volume drop in the Q4-08/Q1-09.

ok..i'll bite. why would anyone have to buy?

right. why would anyone HAVE to buy? No one HAS to buy. So when there are no buyers those desperate sellers have to sell at depressed prices, if they NEED to mover their property. Simple Stuff.

but that scenario is over. buyers are back and as the summer winds down/with the recession over. Buyer activity should be strong come late Aug/Sept/Oct. IMHO :)

ah..i misunderstood.

buyers have to buy if they dont want to waste money on renting, if they want to develop a credit rating, if they dont want to live in a peice of crap studio with an electric stove, if they want to become part of the ownership society that our country is........

and such a functioning society is have proven to be.

lets take Katrina for an example... where did the renters end up? on a cot on the floor of a stadium with 10 thousand other renters living in a trash strewn hell hole. Where did the owners end up? in paid for sweet rental homes while FEMA and insurance companies were rebuilding their multi million $ beach homes better and nicer than they were before the storm.

in that case would you have rather been an owner or renter?

you've hit a new low. really. on many levels.

buyers will only buy when it makes sense for their circumstances and objectives. i can think of more scenarios where a seller must sell over a buyer needing to buy in this environment. sellers in over their heads are far more desperate than potential buyers that right now have time on their side. i don't have to buy, i just like the idea of owning my own home when i find a deal that makes sense. otherwise, i'll happily rent my place until circumstances change.

This is an interesting point of inflection. Does the buying pick up after the summer in a meaningful way or have all the patient well financed optomists made their purchases. This will be influenced by the equities market this fall in an indirect 'confidence' enhancing or deminishing kind of way. May arguments have been made for a second leg down in the third quarter. I have no idea which way fortunes will flow. Markets presist...that is for sure.

nervousbuyer maybe you can grab the bunk next to aboutready on the floor of MSG.....

idiot.

petrfitz, with all the money i'm saving not paying artificially inflated prices for a condo, i can afford to get a room at the four seasons. your point is what? if you can't lend any quality to a discussion, best to keep out.

Both buyers and sellers ALWAYS see ANY "positive" news towards their POV as reason it's "their" market. (i.e. "a buyers market"/"a seller's market"). So, as stevef said "Of course". But that's an answer to the title of the thread, not the secondary "is the market improving".

sure you can nervousbuyer. you are smart being a market timer and continuing to pay 50% of your take home to your landlord each month. condo prices in manhattan will never ever be back where they were js 2 years ago, rents will be going down and you will get an awesome return on investment from your rent.....

99% of sellers dont have to sell, a majority of buyers believe they have to buy.....the rest arent really buyers, they are wannbe's who think that they can time the market

"99& of sellers dont have to sell"

umm, no!

As to the question of the thread, yes I think it does. If anything, it makes sellers less likely to be pressured by emotion or fear to hit what they consider to be a low ball or below market bid; just because that is the only one received thus far that is both willing and able to close.

Is petrfitz real, or just a streeteasy employee paid to stir up conversation...I mean some of these comments are comical.

We are at another standstill, it will be interesting to see what happens in the fall. I believe many more sellers need to sell (lost jobs, lower bonuses, higher taxes, etc. )than buyers need to buy (larger family, moving to a job in NY) and NO, renting is not wasting money, it costs to live somewhere and always will whether you rent or own

Petri, howzz Celine?

I would posit this. I think the rally in the equity market will make some sellers less inclined to depend on their 'home' as the one remaining financial asset and may indeed accept NYC re reality and drop their prices more quickly knowing net net their 'wealth' is the same given higher equity prices and lower home prices.

IMHO

So for some of the bulls out there-> higher equity prices plus new real estate rally means lower prices! Yes I said it.

Dam iPhone. Rally = reality.

yes and all the record seting wall street bonuses this year will cause real estate to plummet as well....

The civilians out there(not us top guns) don't really understand economics. I try to talk economics with people and I get them nodding their head saying yes I agree but they offer nothing. Because they know nothing. I know they feel it's just to much work to getting an understanding of economics.

So they rely on what the media tells them, what the stock market does and how many times they hear others around the office saying "ya it's getting better out there"

Steve you are completely wrong almost all buyers complete rent to own calculations before they buy. They also buy only on logic, price comparison, and market timing.

cu you putzes off to the beachhouse and boat that my renters bought for me! have a great weekend couped up in your studio rentals!

It appears to mean more stubborn posting bulls so I would assume sellers as well.

Just do your homework on streeteasy, propertyshark, and acris.
Assign a value to what your looking for. Buy on your timetable and needs.
It IS a buyers market and will be for some time and don't let anyone fool you different.

too bad you don't rent your slums to wall street titans, petro.

http://dilbert.com/strips/comic/2009-03-07

LMAO. Pertri... do you understand that the "RE as financial ride to riches" is OVER? Regardless of the handful of front-running, game rule changing monkeys in suits that are left to lick their nut sacks as Obama decides "executive pay."

Hahahhahahahahahahhahahha.... Celine is sleeping with an older gentleman.... LMAO.

I also think the many people have learned valuable, yet costly lessons in the last year. Many folks were stretching beyond their means to buy places they really couldn't afford. i have good friend that found himself in this position when he bought a place that consumed practically his entire salary. they lived off of his wife's salary and paid the mortgage on his. he wasn't saving money. when his portfolio took a nose dive, and later his wife lost her job, he really was in a bad place. luckily, his brother floated him a loan until the got a new job. he is now selling his place so they can downsize to something which will let them save some money. ironically, they are expecting a baby but looking to move from a 3-bed to a 2-bed. i wonder how many sellers are in a similar position.

In my segment (family-size pre-wars, UWS/UES), the market-setting sellers are mostly estates. While some heirs may be "stubborn", their stubbornness does not track the Dow. If anything, their intransigence may soften as their other assets regain value.

but why see a place at 2007 pricing? that's like me offering CSCO at $30 - just ignore it and find something being offered at the clearing price. unless you are saying that you can't find ANY properties at what YOU deem to be the correct price. if that's the case, then you are wrong, and why would anyone sell to you if your not bidding the clearing price?

if something isn't for sale at the clearing level, its not really for sale, so what is there to complain about?

printer, good question. i saw places earlier in the spring that had 2007 pricing, but when i got to the OH, was told that the seller is negotiable. i passed at the time on making bids since i first wanted to secure a pre-approval under the new jumbo qualification standards. what i'm hearing at the current OH visits is that sellers are so "negotiable". i figure they leave room to come down since buyers expect some concession these days.

i meant sellers are not so negotiable

i understand that someone would 'leave room for negotiation' but they have to start somewhere. if prices are down 20-30% from '07, I would think that they'd have to be offering it at most 10% above current prices to be considered serious. i mean, if the start is at '07 prices, i wouldn't even bother. and i don't know why your broker or the selling broker would bother either.

petrfitz: Your posts have now crossed the line from farce to offensive. The idea that the poor and disenfranchised in New Orleans would be alive today if they had just smartened up and got a mortgage. You are a complete and utter douchebag. Ignore.

"if something isn't for sale at the clearing level, its not really for sale, so what is there to complain about?"

Do you think ALL the sellers asking those prices honestly believe they are as overpriced as they are? The problem with the analogy is that I can spend 2 seconds and look up the market for CSCO. If I want to know the price of my apartment, I have to spend countless hours just to get a set of quotes with a 30% +/- range. Many sellers think they are asking a "little on the high side" and pride of ownership ("my place is special") takes up the rest of the slack.

It's not like placing one's apartment on the market is a sport: having to keep your unit in "show condition" all the time, rearrange your schedule for showings, have 100 "buyers" who have no intention of actually buying anything poking thru your underwear drawer........ most sellers THINK they are serious. They may be deluded about their pricing, but it doesn't mean they aren't truly on the market. They are just not in reality, and this is often aided by others **cough** "helping" them along with those delusions.

"In my segment (family-size pre-wars, UWS/UES), the market-setting sellers are mostly estates. While some heirs may be "stubborn", their stubbornness does not track the Dow. If anything, their intransigence may soften as their other assets regain value."

I think this is a very important point in many ways (and really too difficult to fully enunciate in a single post). One thing being that if the only thing selling at these levels are Estate Salas, and most buyers are not willing to put up with the tsuris of buying one of those, we may have a bifurcated market where the people who pulled the trigger on estate sales because of "how good the prices were" may have jumped the gun (the bifurcation coming in terms of the people not willing to buy estate sales and the non-estate sale properties having a totally different character than the rest of buyers/sellers).

I would posit (without any proof) that the percentage of apartments on the market who's seller's "have to sell" has risen over the last year. When the market was rising fast, people put their units on and when the bell rang, traded up. Today, there's got to be a tron of people who would "like" to sell, but aren't on the market because they have the knowledge that they can't get the price they "need" to sell.

And while you rarely have people who "HAVE to buy", you always have people who HAVE to move; so it's either rent or buy. If that number rises, whichever market they are saturating will turn prices in favor of the other market (depending on the gross numbers of renters, buyers, landlords and sellers). There is just plain no argument that sales aren't being done - PERIOD. The question is only who is actually buying, who is actually selling, what is being sold, and what the strike prices are. I think IF my original premise is correct (higher percentage of "have to sell" sellers), there are going to be some number of buyers who purchasing is the correct decision for (and even if it's not the correct decision, they're doing it anyway).

I think the rise in equities will make re sellers more intransigent. For right now. But I think this market will go down slowly over a period of time. This time is different because the fat cats that have driven the real estate market really had to look into the abyss this time and I think what they saw is imprinted on their brain stems. I think they are going to become far more conservative, just like the entire generation after the depression became rather penurious. The fat cats will continue to make wealth but they will conserve their wealth. The days of profligate spending is over and it will reverberate in the real estate market, the art market and the luxury goods market.

I want to buy in NY. But I have found sellers and brokers are rarely moving off 2007 prices. I hope more reasonable inventory comes on the market in the fall but if I don't find anything reasonable, I will rent in NY. I want to buy. I don't have to buy. I might also consider real estate investments in other cities -- San Diego has become reasonable as well as many cities in Spain. I just bought in Miami. Real Estate is an investment and I will not finance anyone else's loss. So until prices come in a bit, I will be a renter. I have the luxury of time to see if I am correct. Even if I'm wrong, at least I will be certain that I will not lose money.

70% of stock trading is low latency trading
I don't know anyone who has been increasing their allocation to equities

conclusion...
I don't trust the market.

If a company's business has been expanding and earnings increases steadily because of if, you will buy the company's stock. At some point, the stock will seem expensive to some who believes that the company's business/earnings will not grow much anymore. Others will still find the stock to be cheap because they still believe company can grow even more. What's my point you might be asking at this point... Well, if the house is a company and the stock has shot up 150% to 200% sharply and then came down only about 10% to 15% only recently, would you buy the company's stock knowing that practically everyone expects no growth the next 3 years for the industry while some predicting further decline? I understand people buy for many reasons and 'quality of life' being a very important one. However, if buying is primarily for financial reasons, you can afford to stay on the sidelines for at least another year when considering the following factors together for the next 12 months: chance of prices shooting up / declining, rate of economic recovery / interest rate increases, cost associated with owning (interests/insurance/taxes/maitenance/utilities) vs. rent, etc...

Keep in mind I'm not talking about cities where prices have dropped 30% or more. In those places the prices started dropping much earlier. I'm talking about places like the NYC area where prices have only started dropping recently.

Is this stubborn? 738 days on the market and 42 other listings in the same building. If this had been priced at 1.2 in 2006, they would have sold with a nice, quick profit. Stubborn and greedy. They were looking for a two week return of almost 50%. And they still don't have a clue. Even if I were interested in this apartment, I wouldn't consider it because you can't negotiate with loons.

4/27/2006
Previous Sale recorded for $1,057,000.
05/10/2006
Listed in StreetEasy, but temporarily delisted, by Prudential Elliman at $1,485,000.
05/18/2006
Listing is no longer available.
12/14/2006
Re-listed by Prudential Elliman.
12/14/2006
Price decreased by 2% to $1,450,000.
06/07/2007
Price increased by 3% to $1,500,000.
12/03/2007
Price decreased by 1% to $1,490,000.
08/01/2008
Listing entered contract.
11/12/2008
Delisted temporarily.
01/06/2009
Re-listed by Prudential Elliman.
02/27/2009
Price decreased by 6% to $1,395,000.
04/22/2009
Listing entered contract.
06/25/2009
Re-listed by Prudential Elliman.
07/03/2009
Price decreased by 3% to $1,350,000.

I was planning on buying if I can buy the unit I want at 02-03 prices. That was before the super low interest rate/funny money was pumped into the system.

I am worried about interest rates rising and bringing down prices. Any thoughts? Better waiting and putting more down when rates are higher?

And I have also started to get a bit more broker cockiness...."We had numberous bids over ask" and "The seller is not going to even entertain lowball offers"...

nervousbuyer, you mentioned that you have 35% for a downpayment. No doubt you have seen the argument that interest rates being at historical lows as a reason to buy. Keep in mind that higher interest rates will likely put pressure on prices as less buyers can afford to buy. You will have an advantage with that 35% downpayment. I'm also going to go out on a limb and guess you will pay off your loan way before 30 years, making the interest rate increase less of an issue for you compared to other buyers.

petrfitz, do you seriously despise the people you rent to?

check out today's Urban Digs blog -- www.urbandigs.com . Noah is discussing the same topic. There is reference to both buyer and seller viewpoints.

thanks...i just saw it.

why is it that buyers exepct RE prices to fllow stock prices when it benefits them, but not when it disadvantages them. I remember that when the stock amrket was in free fall, tons of buyers on SE demanded they get the same discounts as the stock market saw. But now that the market is up, buyers don't want there to be a connection between the stock and RE mearkets. Well sorry, you can't have it both ways.

Obviously no one has to buy and no one has to sell. The fact of the matter is, the buyer sets the price. Further, some DO have to sell, but there are technically NO buyers who must buy. The battle rages on...and a recovery in the market and/or the economy doesn't mean we have seen the bottom. Ask 1988 and 1989 about it.

Probably, but if their goal is to sell, they should be wary of stubbornness. This rally in the stock market is truly remarkable - no one can dispute that - however, it's a bear rally nonetheless. Even the long-only pros acknowledge that while this rally may last another 6-9 months, it will inevitably end, and subsequently lead to a multi-year, slow, prolonged decline.

From Dave Rosenberg:

“Something tells us,” Dave Rosenberg sighs, “that the marginal buyer of equities today at that price may well be the same person who was loading up on real estate during the summer of ‘06.”

And today, after a 45% rise, the metrics, to dip into the Street cliché, are positively mind-boggling. The dividend yield on the S&P 500, Dave notes, is a meager 2¾%, and payouts so far this year have lagged some 32% behind last year’s not-exactly-torrid pace.

In a like astounding vein, he observes, the trailing P/E on operating earnings (adjusted, he explains, “to take out everything that is bad”) is now at 24 times, while — and if you have a queasy stomach you can skip this number — on trailing reported earnings, the multiple is a mere 760-plus!

No offense to Rosenberg but he's been disputing this rally the whole way up. I don't think you can compare the valuation of equities at 16x normalized Shiller eps to Manhattan condos trading at 30x price to rent. Equity valuation is fair here (maybe it should be cheaper than fair because of the risks). However, there is no way to cast Manhattan real estate as fairly valued. Don't compare the two.

"This is an interesting point of inflection. Does the buying pick up after the summer in a meaningful way or have all the patient well financed optomists made their purchases. This will be influenced by the equities market this fall in an indirect 'confidence' enhancing or deminishing kind of way. May arguments have been made for a second leg down in the third quarter. I have no idea which way fortunes will flow. Markets presist...that is for sure."

Fall will be interesting. Can the bulls draw some lines in the sand, so when you're wrong, you will have to admit it? Its so interesting that the bulls are declaring the same correction they barely admitted was real...over. This, based on some activity that barely dented inventory.

PS: John, some people define bull as a 20%+ rally. Some define it as above an upward sloping 200-day. I'd like to see it above the 500-day to call it a bull market. Whether it is or it isn't, don't be too flippant about declaring that this is not a new bull market. If you (or Rosenberg) really knew, you'd be making money trading it.

Manhattan real estate seems like a much easier bear call here.

steveF
3 days ago
ignore this person
report abuse yes of course.

Given Steve's accuracy rate of 0.0001% (even worse when he's sure), I guess we know the real answer to that.

We'll ignore the fact that money moved from stocks to RE when stocks tanked and RE did well....

the reverse can't happen... right, steve?

"Its so interesting that the bulls are declaring the same correction they barely admitted was real...over. This, based on some activity that barely dented inventory. "

I KNOW!

Oh my lord, the lunacy is amazing!

" I try to talk economics with people and I get them nodding their head saying yes I agree but they offer nothing."

Steve, thats not because they don't understand economics..

its because YOU don't understand economics!

inventory is down, per UD, 15% from the peak, and falling. and don't waste your time citing 'seasonals' b/c we all know that you never predicted a normal seasonal reduction in inventory. the whole bear argument was that this spring nothing would sell and that's when the real panic would begin. of course, it didn't happen that way, so now you just revise and push out. the end is always around the corner.

The economics at play here are this. Financing got super easy, driving prices super high. That financing has gone away. We are now in process of finding how much cheaper real estate must get to balance supply and demand. If there are a ton of buyers out there with the will and the dough, the bears will be wrong...but probably not.

Printer the only thing I predicted (and even then, only after Lehman failed) was that the market would correct meaningfully. So far I am right.

"the whole bear argument was that this spring nothing would sell and that's when the real panic would begin."

No, it wasn't (but good try with the strawman).

The bear argument was that the Manhattan economy could not support peak prices... and it was proven 100% correct (hence that whole 20-30% decline thing... which is still going, btw).

We already had a "real panic"... now we're just trying to stop the bleading.

> the end is always around the corner.

Sorry, but thats the bear argument. The "recovery" has been "next month" for TWO YEARS!

sorry, correct, thats the BULL argument.

"Printer the only thing I predicted (and even then, only after Lehman failed) was that the market would correct meaningfully. So far I am right. "

Bingo. As did the majority of "bears" on the board.

That the bulls are now doing this "well, its 25% down but it won't be 28% so you're wrong" crap is just funny.

or "well, the world didn't literally blow up so you're wrong"

To be fair the bull argument is this. It is that prices bottomed here at 30% down with a flurry of activity in May/June that presages a stabilization. The counter is that the recent activity is the last gasp of optimistic monied buyers. If the bears are willing, draw a line in the sand. If prices tick up in Q3 on a sequential basis....I WILL HAVE BEEN WRONG and I'll admit it. (This said, if they then start down again, then I will have been wrong about being wrong). Meanwhile, the people who told me that prime UWS could not fall 30% or "they would move to Canada" or "dogs would roam the streets", need to now admit that they were in fact very wrong.

True... all the folks saying this could not happen skipped from from "it can't happen" to "see, its over already".

How about it.... all the folks who said we wouldn't get the crash. How about it?

Come on bulls, when are you going to finally admit you were wrong?

btw, separately Rhino.. the Q3 contract data (elliman/miller) is already lower then Q2... so we're looking at another decline quarter.

Actually my favorite bear bullshit line is the one you have already mentioned. The one that somehow even tho real estate fell 30%, bears are now wrong because the financial system didn't crash and/or the stock market rallied. In other words, anything good happens to anything, anywhere...A Manhattan real estate bear needs to admit they were wrong. The more nuanced barb is this. Because prices cannot be proven to be continuously falling, then they have bottomed...And therefore bulls have already missed the bottom.

Q3 is down in pricing or volume? BTW, bulls are also bragging about the Q2 activity without knowing the prices yet.

wow, you called for Manhattan real estate to tumble AFTER Lehman went bankrupt? and you are patting yourself on the back for that? I predict that the sun will rise tomorrow. If it doesn't, I am fully prepared to admit that I was wrong.

Printer, I agree that that wasn't that prophetic a prediction.
Which is why its amazing that the bulls who said it would NOT still haven't admitted they were wrong.

Yes, we knew the sun would rise...

but the folks who said it didn't still haven't admitted the mistake.

"Q3 is down in pricing or volume? BTW, bulls are also bragging about the Q2 activity without knowing the prices yet. "

Pricing.

You write as if there weren't the same people on this board arguing it wouldn't. Further, the SPY was bid around 1200 at the time...so if all this shit was so obvious, why didn't you make any money? Aren't you the clown who "knew" financials earnings would be better than expected, but didn't invest on it? That makes it kind of funny that you would call me out. The greater point here, is that losers like yourself demand I was wrong about Manhattan real estate because the S&P rallied or the financial system didn't collapse.

"The more nuanced barb is this. Because prices cannot be proven to be continuously falling, then they have bottomed...And therefore bulls have already missed the bottom."

I love it!

My usual is, if it doesn't go down 100%, then apparently my predictions of a major crash were wrong.

I think my prediction that prices will fall from here is no less obvious.... Does that mean I shouldn't brag in Q4 when its proven right? Will bulls pretend again in December they didn't say we had bottomed? Or will they demand I admit I was wrong because we will have only fallen another 10%? Or will they deny that the additional 10% happened at all? So many choices!

"The bear argument was that the Manhattan economy could not support peak prices... and it was proven 100% correct"

What? That's a conveniently impossible argument to refute. Of course peak prices can't be supported - they've already hit their peak.

"Sorry, but thats the bear argument."

Freudian slip?

"To be fair the bull argument is this. It is that prices bottomed here at 30% down with a flurry of activity in May/June that presages a stabilization. The counter is that the recent activity is the last gasp of optimistic monied buyers. If the bears are willing, draw a line in the sand. If prices tick up in Q3 on a sequential basis....I WILL HAVE BEEN WRONG and I'll admit it. (This said, if they then start down again, then I will have been wrong about being wrong). Meanwhile, the people who told me that prime UWS could not fall 30% or "they would move to Canada" or "dogs would roam the streets", need to now admit that they were in fact very wrong."

Rhino, that's much more fair than the above. I agree with much of that. I also don't see how anyone can declare stabilization after two months of heightened (or lowered, if that were the case) activity. As has been repeated ad nauseum, these things take time to fully play out.

"btw, separately Rhino.. the Q3 contract data (elliman/miller) is already lower then Q2"

I don't think it's Miller data, but maybe I'm mistaken? Either way, you keep pumping this in every other thread, even though the quality of the data is still suspect. I also think there hasn't been an actual report published anywhere, just an article about the leaked data in TRD. I'd be more careful.

{West81st
2 days ago
ignore this person
report abuse
15 West 81st #6/7C sold on July 20th for $3.5MM. That qualifies it as a price-chopping, market-moving, lowball-accepting estate nightmare for Museum-view sellers.

07/16/2008 Listed in StreetEasy by Corcoran at $6,950,000.
09/14/2008 Price decreased by 7% to $6,495,000.
01/30/2009 Price decreased by 11% to $5,750,000.
03/02/2009 Price decreased by 14% to $4,950,000.
03/16/2009 Price decreased by 9% to $4,500,000.
03/30/2009 Listing entered contract.
07/20/2009 Sale closed for $3,500,000.
http://www.streeteasy.com/nyc/sale/319846-coop-15-west-81st-street-upper-west-side-new-york
http://a836-acris.nyc.gov/Scripts/DocSearch.dll/Detail?Doc_ID=2009072300395001

Condition was terrible, but the price is still stunning for a 3000SF duplex eight facing the AMNH, on a high enough floor to see over the Planetarium.}

Classic duplex 8, overlooking AMNH 3000sqft, $3.5MM => nuff said.

neck and neck w bipolar....

"What? That's a conveniently impossible argument to refute. Of course peak prices can't be supported - they've already hit their peak."

Ah, silly boy.... folks didn't know they were peak prices at the time!

(well, some did)

" Either way, you keep pumping this in every other thread, even though the quality of the data is still suspect. I also think there hasn't been an actual report published anywhere, just an article about the leaked data in TRD. I'd be more careful."

Ironically, you made the same argument about prices going down 20% in the first place, and a lot of good that did you.

But, honestly, I don't really care if you think I should be careful or not.

Hell, you should have been more careful... you bought near the peak of the bubble.

The best you could know (without knowing enough to short Lehman) is that prices did not make for sound long term investments after 2004 or so. Even knowing that, it was hard with rents rising to not talk ones self into buying (using tax deductions and rising rents as reasoning). Once prices started falling, once Lehman happened (basically concurrent)...Its the arguments that this could play out and bottom in under a year, from those valuations that seems more stupid than anything.

"Ah, silly boy.... folks didn't know they were peak prices at the time!
(well, some did)"

Doesn't change the easy-way-out phrasing of your argument. No one would argue with that.

"Ironically, you made the same argument about prices going down 20% in the first place, and a lot of good that did you."

That doesn't make it any less valid. Sometimes you'll get lucky and get it right (you know that stopped clock argument...) but continually drawing such firm conclusions from suspect data will almost certainly drop your batting average below .500. And this not being baseball, that's the Mendoza Line here.

"Hell, you should have been more careful... you bought near the peak of the bubble."

Thanks mom. Seriously though, I bought nearly a year after peak, and even then you know nothing of the details, so why make such a silly statement?

"check out today's Urban Digs blog -- www.urbandigs.com . Noah is discussing the same topic. There is reference to both buyer and seller viewpoints. "

Rhino86 "The economics at play here are this. Financing got super easy, driving prices super high. That financing has gone away. We are now in process of finding how much cheaper real estate must get to balance supply and demand. If there are a ton of buyers out there with the will and the dough, the bears will be wrong...but probably not."

Before I saw Rhino's post, I had thought to myself "I agree with Noah, except he missed one thing: it takes 3 to Tango: 1)buyer, 2) Seller,and 30 LENDER". I think we won't know until we see on a case by case basis how much of an effect financing (or lack thereof) has on closed deals. It will be interesting to see what percentage of newly minted hot to trot buyers can't make it to the finish line even though they started the race with great enthusiasm.

I can't believe urbandigs admitted to a hairy back!

30 yrs, the lender is kinda the borrower's spotter. I am not sure the buyers know how much they can press now that they are off the steriods. The unique part of Manhattan is that the credit bubble not only impacted financing, but it levered the incomes of the investment/commercial bank professional buying pool....and the hedge funds running on leverage. Its a joke. I don't see what industry could possible step into the void.

a) it was supposed to be "3) LENDER" not "30"
b) Rhino: were are in agreement. That was my point ("the lender is kinda the borrower's spotter") : it will be interesting to see how many of the dogs of war who are hungering for a "kill" get a very firm yank on their leash before reaching their targets.

RE: Stock Mkt. Lets hope we have a gradual upward trend. 2% swings upward in 1 day is not good. I'd rather see slow and steady moves upward. Many of the banks in NYC are starting to hire again. Businesses have been forced to cut expenses and operate lean and mean. Those businesses that are generating a profit did it at the expense of trimmed expenses. Now, it is impt to see how earnings drive mkt. If companies make money, which looks like some are, we will have steady upward trend. I belive real estates mkts moved to fast in NYC and other urban areas on the downside just like the mkt. If u can get 40% off mkt highs, with low interest rate. You will be 100% content with you investment or primary residence. They have plenty of short sales and foreclosures but nyc is an efficient mkt with plenty of money. It is the world's money, so plenty of buyers timing the mkt. When prices stablize which some have .. bottomed at 30 to 40% from 2006-7 highs. 5 yr return will be strong in RE but stk mkt (buy index) will yeild higher return.

30 years there is that. Then there is how many people are left after this flurry who want to buy. Then there is the pace of new buyer creation among current renters with the will and mind to buy. I think we just burnt through many of the last of the finest optimists. People want to focus on the much reduced finance sector maybe getting paid well this year. How many of them already own? How many of them who rent care to own at this juncture.

How come JuiceMan won't post what he thinks the price to rent ratio should be?

When prices stablize which some have .. bottomed at 30 to 40% from 2006-7 highs.

I haven't seen prices with these kind of discounts. I have seen 30% cuts from an inflated asking price but not really off 2007/8 comps. You must also consider that even if businesses recover and incomes appear safe, buyers have new parameters to consider:

1. Lender. Rhino and 30 are right here. I went thru this process last year and it was brutal
2. New financial parameters. It is difficult to discern what you can afford because new tax hikes are coming but rates are unclear. Also, no one can discern how the governments debt load will affect business and therefore individual incomes. It is unprecedented territory. There is a boatload of unknowns coming up on the horizon.
3. New Resale parameters. Because of the above, people are downsizing and (anecdotally) leaving NY altogether. Plus an unknown amount of shadow inventory. Plus, many residential buildings in trouble where the developers might dump inventory and further press on prices. How can you calculate return with so many unknowns. And no one seems to be talking about how a mass wave of middle and upper income downsizers will affect the market.

good point, I should have added that to the piece although I for that specific discussion I was focused on the first step in the process - the meeting of the minds, without which, it doesnt get to lending process.

Sorry I don't see how pointing out 88 thru 92 where stocks diverged with manhattan real estate is arguing the stock market. That said I think arguing stock market to manhattan real estate is slightly less stupid than using national economic data. Maybe it's me just being a hippo another comment that eludes me.