Hey Bears, What you going to do now?

well, pop the champagne and pass the caviar. everything's a-ok, i know it's true because alpie said so.

"Feds See Biggest Tax Revenue Drop Since 1932"
http://www.msnbc.msn.com/id/32275055/ns/politics-more_politics

It's a cycle, so take it as well as you dish it when your turn is up!

http://www.businessinsider.com/henry-blodget-state-of-the-real-estate-market-july-6-2010-plenty-more-downside-2009-7#still-5-10-above-trend-1

Is this 'President' guy the moron of the board?

Not so much the court jester, as that guy is aware of his performance.

I'll probably just wait for the next proverbial shoe to drop - there are some big ones waiting to tip:

bankrupt state budgets
social security running out of dough in the next decade or so
record unemployment

... I guess I am just a worrier at heart, but the way I see it, there are plenty of triggers for another crisis just waiting to be pulled

President! I missed you. I mean, I really, really MISSED you!

So, I just reloaded, and fired again...

thanks for that link AR!

""Our tax system is already inadequate to support the promises our government has made," said Eugene Steuerle, a former Treasury Department official in the Reagan administration who is now vice president of the Peter G. Peterson Foundation."

love the PGPF! finally there's somebody lobbying for the young.

Dwayne. May I use that line?

everything is relative.
http://www.nypost.com/seven/08032009/news/regionalnews/luxe_apts__182765.htm

I'm going to Disneyland!

why does the manhattan rental market continue to collapse ?

why do I even bother responding to this

http://jubakpicks.com/2009/08/03/its-official-this-is-now-the-longest-recession-since-the-great-depression-heres-why-that-matters/

I think you're right Alpie! Why NOT pay $1.2 million to buy an apartment you can rent for $4,000 a month? After all, there's:

a) the TAX BENEFIT, and
b) the fact that you can paint your walls aubergine if you want.

Yes indeedy, everything's just FINE with Manhattan real estate. Hunky-dory, in fact.

Ryan air is going to charge for it's rest room???? What happens if you can't pay?

You sit in your own poo.

I think may people are mistaking a sharp rally in the stock market as confirmation that our economic troubles are over. The fact that there has been a rally in equities here and overseas based upon technicals does not mean that our economy is going to come roaring back to what it was in say 2006, for example. The best "fundamental" reasons that I can find for the latest rally are:
1) Positive sentiment since the post-March collapse as investors believe we are not in a depression.
2) Market was extremely oversold in March so there is a technical rally, and most likely we are now shooting into overbought territory.
3)A weak dollar has driven up commodities which are trading in lock-step with equities.
4) Some seemingly positive earnings and the fact that most companies are beating analysts estimates has led to the media pumping out euphoric news.

The fact that this rally has been one with relatively light volume should be disconcerting. In addition, it is becoming very clear to me that China's stimulus plan is fueling a major bubble in the Chinese stock market and real estate markets (essentially banks are taking the stimulus money and investing it in stocks driving up the price of ipos 60% in one day...not good). The whole oil and commodity play has been predicated on the weak dollar and China's stimulus, two trends that will end. And finally, the US consumer is almost 180 degrees apart from where he was in 2005, and that will have broad implications for years to come.

As such, even if our economy bottoming, which it may be, what is the catalyst to spark growth? It seems to me that our market has priced in a major recovery already...so, if the recovery happens (which I doubt, stocks will have already been priced to reflect that, and if it does not, stocks will most likely sell off. The main tell is the dollar, when the dollar starts to strengthen, which I believe it will big time in the next several months, and China's stock market crashes, which I believe it will in the next 12 months, look out below.

Steve, exactly, except there's nothing really stopping you from painting the walls of your rental aubergine. Maybe a bit of expense, but not that much if you really want aubergine and espcially if you are hunkering down for awhile.

and (as you have previously noted) upgrading your kitchen or doing the floors or sanding the doors. given the amounts of money at stake -- particularly once you get into two or more bedrooms--a mere 5% decline in value (if you purchase rather than rent) is in the neighborhood of $50K, which can pay for a bunch of nice upgrades.

"Hey Bears, What you going to do now?"

I thought I'd go on about my summer, then get the kids back in school in the fall, maybe do some skiing over the winter and look forward to spring, all the while keeping a distant eye on the RE market so I stay somewhat current while the air continues to leak out of the balloon. After that, I'll probably repeat. Is that enough detail for you? Check back in 2011 for an update if you like.

this is so stupid

Quoting NYC10022 - "Crain's just published the stat on biggest income declines by state, as measured by withholdings in the first half of the year vs. last year. We're down 15%, tops in the nation (US average 8%) (print version from last week)"

Real estate just doesn't go up when banks use normal underwriting standards, people have less income, and more people are foreclosing. Even if people were willing to pay top prices the banks and appraisers won't let them.

So we got better housing numbers, better economic numbers, better consumer spending numbers...but the bears still hang on to that lagging indicator they call 'unemployment'.

real PCE declined. nominal PCE increased due to gas prices. incomes declined.

but inventories are being restocked. and for the next month or so the taxpayers are supporting auto sales again. and because foreclosures are so high and the taxpayers are paying for first-time home buyers to grab a piece of the pie pending home sales will be up for another month of two.

lookin' good.

"So we got better housing numbers, better economic numbers, better consumer spending numbers...but the bears still hang on to that lagging indicator they call 'unemployment'. "

how much of that depends on gov stimulus (including 0% rates)? how much of that will be lost once the gov has to cut back and raise rates?

regarding RE, the high end mkt keeps on falling and foreclosures on nice homes just started. RE is a ladder, so it's impossible for it not to have an impact on the mid mkt. interesting times ahead imho.

I really wish this crash would happen so I can upgrade.

Oh yeah ericho75 I totally agree with you, the NYC real estate market is ALL roses now un huh.

http://therealdeal.com/newyork/articles/wary-of-the-rebound

JM, i'm rooting for you. and we're already part of the way there!! just think, this time two years ago it didn't even seem a possibility, merely a light in my shining eyes!!

"how much of that depends on gov stimulus (including 0% rates)? how much of that will be lost once the gov has to cut back and raise rates?"

Price is the only think that matters.
Consumer spending are up back to back months. The government surely didn't point a gun in people's head to go out and spend.

"Finally, while the current bounce in activity may be keeping brokers busy for now, many fear their once-extravagant lifestyles may be gone for good."

extravagant? like eating out?

ILuvNY,
That article should tell you something. That is the first somewhat quasi-positive article The Real Deal has published in over a year. I wonder how much pain it took for the editor to even approve the word "Rebound". If the real deal is turning then it's gotta be happening.

"extravagant? like eating out?"

I know some of you laughed at me 4 months ago when i pointed out Cheesecake factories numbers and stock performance.

http://finance.yahoo.com/q/bc?s=CAKE&t=2y

Well...it's printing 52 week highs now and earnings were GREAT again.

Again, ask yourself this. Why are folks eating out in Cheese Cake factory and PF Chang if things really are falling apart?

"http://therealdeal.com/newyork/articles/wary-of-the-rebound"

Again, more talk of 'UNEMPLOYMENT'.
People that don't understand finance are the ones using 'unemployment' as a leading indicator.

"JM, i'm rooting for you. and we're already part of the way there!!"

Unfortunately not the case for what I'm looking for. It is nice to say the market is down 20-25%, but that certainly isn't true for good family apartments in the UWS. I'm really not interested in 25% off a 1 bed condo on 42nd and 11th. Know what I mean?

"If the real deal is turning then it's gotta be happening."

nobody disputes that's there is more activity particularly at the low end. some of it is seasonal, some demand is being artificially borrowed from future (like the stimulus to upgrade cars, 1/3 of it is demand borrowed from future at normal prices). but lay down the ruler. it'd be odd for RE to rebound while prime is still falling.

what will it happen with demand and prices once rates go up? will the gov establish a "mortgage interest CREDIT" to keep artificially propping up prices and transactions?

Even if the government does spit out some sort of program that doesn't mean it's going to be successful. Look at the result of the one they put out so far.

http://therealdeal.com/newyork/articles/large-banks-struggle-with-obama-administration-mandated-mortgage-modifications-treasury-department-report-says-bank-of-america-citigroup-jpmorgan-chase-wells-fargo

"I really wish this crash would happen so I can upgrade."

Ha-ha-ha!

Are the bears still expecting another 30-50% move down from the Spring?

What made you change your projections? Oh that's right, the market has been rallying for 5 months.

But i thought the market has nothing to do with housing?

Like many here, i got caught up with the media and believed we were going to get another plunge.

This bear is still hibernating and bracing for the commercial real estate winter that will dwarf the residential.
Dead cats can bounce quite far and long when coming from such high altitude. ;)

JM, you really aren't reading the comps thread for the UWS are you? your comment shows a surprising lack of info for you. all of w81st's efforts and yet this?

the lower-end market isn't doing so badly. it's the higher-end market that's seeing the most movement. so i'm still rooting for you, despite that shocking lack of awareness.

"despite that shocking lack of awareness."

AR, the only "shocking lack of awareness" is your understanding of how helpful the movements and commentary in that thread are. If you were more aware of the market you might comprehend what I'm saying. I appreciate you rooting for me anyway, even if you don't know what you are talking about.

JM, nice try.

JuiceMan: "It is nice to say the market is down 20-25%, but that certainly isn't true for good family apartments in the UWS."

The figure is 20.9%:

http://millersamuel.com/reports/pdf-reports/MMO2Q09.pdf

Do you believe Miller Samuel this time, Juicy? You quote him for everything else.

And what is the correct price-to-rent ratio, since you said 12x was wrong?

"Is this 'President' guy the moron of the board? "

Yes. What the bears like to do is pretend that when the national economy turns up (if it even has) that means Manhattan has bottomed. It makes no sense.

"I'll probably just wait for the next proverbial shoe to drop - there are some big ones waiting to tip:
bankrupt state budgets
social security running out of dough in the next decade or so
record unemployment"

Lecker don't get sucked into debating the economy, because it dignifies a line of discussion that equates national economy to Manhattan coop & condo market.

The bears forgot the 1990s, they may as well also forget the four or five years after 1987 that the stock market rallied and the Manhattan real estate market fell. Such a fucking joke. And listen, I may not turn out right, and I know it... But the problem with you bears is that you are ignorant of history and your arguments are constructed so poorly and inconsistently over time to suit your feel-good bullshit that knows no other position.

rhino, don't get sucked into debating the stock market, because it dignifies a line of discussion that equates the stock market to the national economy.

"But the problem with you bears is that you are ignorant of history and your arguments are constructed so poorly and inconsistently over time to suit your feel-good bullshit that knows no other position."

that is true for the bears, bulls and the pigs.

Hippo86: Good post, but I think you're mixing up your species.
Best,
East18th

Unemployment is a leading indicator to housing declines. People lose their jobs, then they can't make their payments, then they are forced to sell or the bank sells at a lower price. Plus, when unemployment numbers are high that generally means that the employed aren't doing as well either. If people are making less money then prices can't go up (when/if banks actually use income to underwrite loans) - Unemployment leads to lower housing prices - in 6 months NYC RE prices will be lower.

Right and how much depends on peoples will, their savings, banks willingness to lend. And if finance professionals continue to make less money, the implications are additive over time. Wealth creation is necessary to accumulate down payments. The wealth creation of 2004-2007 was not normal.

To answer the question of the thread topic. I will wait to watch Manhattan prices continue to decline before buying.

"Unemployment is a leading indicator to housing declines."

So then why are sales up and prices are leveling off? Anyone who has been tracking the Case Shiller Index knows that there has been virtually no coorelation between the extent of unemployment and home prices.

"Anyone who has been tracking the Case Shiller Index knows that there has been virtually no coorelation between the extent of unemployment and home prices."

Alpie, you've outdone yourself, and are now in the league of petrzitz.

"The bears forgot the 1990s, they may as well also forget the four or five years after 1987 that the stock market rallied and the Manhattan real estate market fell. Such a fucking joke. And listen, I may not turn out right, and I know it... But the problem with you bears is that you are ignorant of history and your arguments are constructed so poorly and inconsistently over time to suit your feel-good bullshit that knows no other position."

Ok, either you just insulted your own kind (bears) or you clearly have no clue what the difference between a bear and a bull is.

Pretty hard to make a bullish argument after reading something like this article.
“The next leg down on home prices is going to come from the top.”
http://finance.yahoo.com/real-estate/article/107458/high-end-homes-frozen-out-of-budding-housing-rebound.html?mod=realestate-buy
To be sure, the affluent housing market is substantially smaller than the mass market. Sales of existing homes priced over $750,000 accounted for 2.3% of all sales in the first quarter of this year, compared to 4.4% of the housing market in 2007, according to the National Association of Realtors.
Still, the distress in high-end market has implications for consumer spending: the top 10% of U.S. households in terms of income accounted for 23% of consumer spending in 2007, according to government statistics. As those households watch their home equity evaporate, they are more reluctant to spend on housing upgrades or other items.
Inventory of expensive homes is rising. Overall, the inventory of unsold homes in June was enough to last 9.4 months at the current selling pace, down from 11 months a year ago, according to the NAR. But the supply of unsold homes priced above $750,000 swelled to around 17 months in June, up from a 14.5-month backlog one year ago. A recent forecast by analysts at J.P. Morgan Chase & Co. said it would take until at least 2012 for the expensive-home market to recover and that peak-to-trough declines could surpass 60%, compared to 40% for the rest of the market.

yep, RE is a ladder... but if you want to wait a couple of years so that you can grab a more juicy property for less $, why telling others ieb? the less competition you have, the better.

if i ever buy it will be one of those, never a starter home. although i'm not talking about "real prime" i'm talking about "very nice but priced wrongly as prime during the bubble" within a prime area.

"JM, nice try"

huh?

"The figure is 20.9%:"

What figure?

"Anyone who has been tracking the Case Shiller Index knows that there has been virtually no coorelation between the extent of unemployment and home prices."

Don't get into a discussion about correlation with steve, he has been known to have 200 post debates on the topic and then deny that he was talking about correlation.

admin, right on! watching and making low ball offers only on prime stuff, someone will bite.

"What figure?"

The figure for the price decline on the West Side: -20.9%.

I wasn't discussing correlation, JuiceMan. Again twisting everything I say.

Still waiting for that price-to-rent ratio that's not 12x according to you. What is it, then?

When this economy turns around...and it will...
Alpie would have called it first. No question...
He's the Roubini of the recovery and, you read it here first before anyone else.
Sage or house bound lunatic?

"The figure for the price decline on the West Side: -20.9%."

That has very little to do with what JuiceMan was talking about. We're talking minimum 2BR/2BA in quality buildings on the UWS, not just anything on the very non-descript "West Side". Tougher to measure, sure, but it's worth pointing out.

"Tougher to measure, sure, but it's worth pointing out."

I can only provide the data that are there, but in point of fact the more expensive the apartment the more the price has suffered.

Juicy wants to use Miller's data - there they are. Seems like, when discussing falling prices with Juicy (and bjw), no data are reliable. Only when prices are increasing are they.

keep shorting

JuiceMan: Although the picture is much more complex than an across-the-board 20% decline, that seems to be a pretty reasonable top-down figure. Really, if a large 2BR 2.5BA at the Grand Millennium is down 20% from a same-unit 2007 sale, what's immune?

"I can only provide the data that are there, but in point of fact the more expensive the apartment the more the price has suffered.

Juicy wants to use Miller's data - there they are. Seems like, when discussing falling prices with Juicy (and bjw), no data are reliable. Only when prices are increasing are they."

Come on Steve, don't get so immediately defensive. You're actually right that the high-end has suffered the most. I do think that (and correct me if I'm wrong here JuiceMan) he's talking about the segment in between, the $1.2m-2m range of larger co-ops on the UWS. And the data are there, I'm just a bit lazy (and busy) to pull them out right now. I have no problem with good data, but don't over-generalize or use one number to misrepresent something else. He was pretty clear on the location and kind of apartments he meant.

I'm not defensive at all. You asked for data, I provided them.

Yes, you did, but the answer you gave was roughly like supplying the population of Connecticut, when someone asked you for the number of single males in New Haven.

stevejhx and juiceman need to hook up already.

cue dirty porn music.... dong dong dong..... waka waka... dong.....

Can't hold a note if I tried....

“I can only provide the data that are there, but in point of fact the more expensive the apartment the more the price has suffered.”

I'm ok with the -20.9%, I asked because I didn't know where the number came from. Interesting that steve uses this metric to prove a point AND it is a price per square ft measure. How many ways has he said that ppsft was meaningless? How can you make an argument using a metric you don’t believe in steve? Once again steve contradicts himself, it a wonder he keeps anything straight.

"Really, if a large 2BR 2.5BA at the Grand Millennium is down 20% from a same-unit 2007 sale, what's immune?"

Fair point w81st, but too small.

"I have no problem with good data, but don't over-generalize or use one number to misrepresent something else. He was pretty clear on the location and kind of apartments he meant."

That was really my point bjw. It wasn't a bullish or snarky statement, but rather an attempt to try and bring some realism to the generalities thrown around this board. Seems people are a bit surprised that I'm a buyer and not a seller.

ok...i missed it...what's your point?

cc, I really have no idea

not snarky? shall we rename you "the one who never indulges in generalizations"?

you have no idea what your point is? well, then we are in complete agreement.

"Once again steve contradicts himself, it a wonder he keeps anything straight."

I'm not good at straight, but I do what I can do. However, once again I used the data because YOU do. If I use different data you say they're no good, and if I use your data you say I'm inconsistent. You really need to make up your mind, Juicy.

"shall we rename you "the one who never indulges in generalizations"?"

If you would like AR but that would be a fairly general point of view

"you have no idea what your point is? well, then we are in complete agreement."

what's your point?

"However, once again I used the data because YOU do."

If I disagreed with data you used, I certainly wouldn't use it to strengthen one of my arguments. That's just bass ackwards