The Real Deal: Activity sparks during dog days

steveF - just for you from an internal system I have for the past 4 weeks in response to your statement, "I disagree that listings are being pulled I think it's being sold.":

All Manhattan
Average Listed Price $1,392,097
Median Listed Price $977,500
Number of Properties Sold 627
Listings Taken Off Market 1280
New Listings 1008
Contracts Signed 1011
Listing Inventory 11758
Average Price per SF $1,090
Listings with Price Drops 1069

more listings were taken off the market in the past 4 weeks than there were contracts signed or new listings added. Hopefully this reality enlightens you.

If you want to compare the last 4 weeks with the 4 weeks prior for LISTINGS TAKEN OFF MARKET, system shows (All Manhattan coops + condos by the way):

6/12/2009 - 7/10/2009 ---> 926
7/10/2009 - 8/7/2009 ---> 1,280

A 38% rise in listings taken off market in the last 4 weeks compared to the prior 4 weeks. Transparency is good

digs, is that ave price per sq ft number list or sold?

LIST, I am 99%

Reality and SteveF: never the twain shall meet.

urban - what did those list/unlist numbers look like in other environments? without that comparison, it is impossible to know whether these figures are meaningful.

UD, What is your impression of the units taken off the market? Do you think these are temporarily "off the market" and owners are waiting until fall to relist or these are sellers who didn't have to sell and wanted to see what would happen?

>Hopefully this reality enlightens you.<
you have to be a wise-ass? I'm trying to be civilized with you and you give that superior tone thing. I proved you wrong on your seasonality theory, your non pent-up demand theory and you "L" recovery theory. So far you have been wrong on those HUGE forecasts and you run a blog. Geez. I should run a blog, keep and simple and to the point, but i will be right.

You asked for it dude.

I expect the rude comments from our psychopath nyc10022 not you Noah.

printer - i dont have any other access than last 4 weeks and prior. this is the problem I am actively trying to solve!!

obernon - combo of both but I would overweight owners waiting for later on to relist

why so defensive? markets up? jobs data is good? Im enlightened by these reports. public doesnt get to see data I just published for Manhattan form internal sharing systems. its enlightening. without it, people think listings are being sold, when in reality, more are being pulled from market.

Care to speculate on why so many properties were taken off the market?
It can't be people fishing for the value of their home.
People looking to make a trade up and changed their mind?
Sellers that were trying to flee b4 the s*it hit the fan?
This is such a strange market.

seasonality! quite simply, this market usually is quite active between say FEB-MAY/JUNE or so and much slower between JUNE - OCT or so..people are away for weekends, the city is quieter in general, and real estate usually slows with it. After labor day or so there usually is a tick up but nothing to write home about, until the next bonus season hits and end of JAN or FEB it starts to get busy again for 3-4 months.

I think many sellers are not happy that bids have not risen significantly from the first comfort zone reached with the wave down we had in prices - so they are choosing to sit back, wait, and perhaps relist next year. Also, listings get stale after 4-5 mnths on market and so much more transparency with sites like this that actually show buyers listing history and price cuts.

disregard stevef's comments regarding my so called seasonality or pent up demand theories. Quite simply, they are off base and Ill address it here.

1) seasonality - YES, this market is seasonal. Hands down. Looking at month to month changes exposes interpretations to noise and misleading pictures. Instead, look to year over year changes for a better idea of what is happening in our market. Manhattan re is seasonal, with FEB-MAY/JUNE significantly more active than summer time and Fall. Summer time generally is the slowest time of the group periods. I always discussed the seasonal nature of this market. Now, when you have a crazy event, like say a LEHMAN failing and AIG being rescued by govt, that freezes up credit markets and results in buyers disappearing completely and a wave down in prices as a result, YES, things after that may play out differently than what we are generally used to. In this case, our market was completely frozen mid SEPT to MARCH. Then stocks started rallying and deals were happening at much lower levels based on price point. Buyers returned because of lower prices and confidence returning, especially as stock rally continued. Deals today are still happening and it is busier now than it usually is for this time of year, yet not as busy as MAY/JUNE was. I talked about this here before. Given what we experienced, what was considered to be seasonally normal must be tweaked.

2. Pent-up demand - My only use of pent up demand was to discuss the re-emergence of buyers that came with the action in late April to late June, after the market was frozen for a good 6 months prior, basically defining the first wave down in prices. People forget that many even dismissed such a possibility happening here. One main reason was the so called 'sideline buyer theory' that I adamantly argued against a few times on UD

http://www.urbandigs.com/2009/03/manhattan_good_as_gold_well_no.html - in March

http://www.urbandigs.com/2009/01/the_disconnect_continues_its_a.html - in Jan when I first started to talk of uptick in action from prior 3 frozen months

The sideline buyer theory was the theory dished out by brokers and bulls that this market will NOT fall too much, because if it did fall say 5% or 10%, buyers on the sideline would flock back in and gran the deals. It was a sales pitch to buyers for the strength of this market when uncertainty started to enter. Nothing more. I NEVER subscribed to this theory, and rather, I debunked it publicly. Discussing pent up demand, and how those that wanted to buy, did, is quite different. I never had any theories on pent up demand nor discussed any on urbandigs. I used it to discuss in real time what I saw happening in our local marketplace, after a very strange thing happened - a huge wave down in prices one thought impossible because

- manhattan is an islane, with limited supply
- manhattan is 70% coop, no speculation
- foreigners will save us
- buy now or be priced out forever
- sideline buyer theories

etc...

Just because someone claims that I made a theory and was subsequently proven wrong, doesnt make it true.

i will admit that I deepely believed this recession would prove to be the worst since TGD, and that a 'L' shaped recssion, and not a V shaped recession was most likely. I was wrong. I underestimated fiscal/monetary stimulus and the effects of natural markets bouncing after such fierce destruction that simply cant be sustained for long given actions taken.

I tweaked to a W-shaped situation, with now being that growth spurt that could last 3-4 quarters. I still believe this debt deflation and deleveraging process from decades of credit excess and leverage to take years to unwind. Accounting tricks and off balance sheet hiding will only prolong process. I dont think this is the end to all our issues. So yes, I was way wrong on seeing this spurt and overestimating the problems that now many feel to be behind us. I just dont think its all over. I wish I did.

Complete speculation, but couldn't some of the sellers pulling listings be swayed by the upticks of the past few months, convinced that they might be able to get a better price in a few months or more? I think that's pretty short-sighted, but certainly within the realm of possibility, especially knowing some of the wishful thinking that can go on.

"I NEVER subscribed to this theory, and rather, I debunked it publicly. Discussing pent up demand, and how those that wanted to buy, did, is quite different."

Definitely, and an important distinction to make. On another note, correct me if I'm wrong, but isn't a W-shape the same as a V with a double-dip? I'm surprised to hear you say we'll push back up towards boom levels (because that would be the implication, no?).

Can anyone comment on what they see is the current range for price per square ft for the upper east side for both pre-war and postwar buildings?

fhsack - you need to be more specific - do you mean Park-5th, or East End-1st? In between? what size place?

"more listings were taken off the market in the past 4 weeks than there were contracts signed or new listings added. Hopefully this reality enlightens you."

When has reality ever enlightened SteveF?

> W-shape the same as a V with a double-dip?

looking above, the first V never finishes.... so you don't actually get the recovery.

But try pronouncing water with two Vs at the front..,... and then tell everyone its the same thing. They'll believe you, because you already redefined "peak", too.

nyc10022, sorry, but that's a pretty sh!te analogy. And if you read a bit more carefully, you'll see that I was merely asking urbandigs if that's what he meant, as it sounds that way. And you're still fixated on the peak "issue" though you have no real answer? Please.

Urbandigs

True manhattan is an island but in length and width, not height.
I also foresee 2 problems Manhattan will have to contend with some 10 and 20 years down the line.

1) The office
Because of technology, the need for people to go to or work from an office in manhattan will greatly diminish.

2) The Queens/Brooklyn coastline
Though maybe a disaster for the next 3-5 years, eventually will be built out much like manhattan not unlike Kowloon Bay to Hong Kong Island if you've ever been.

For those who want to go real long (as much as I hate the areas) the LIC's and Williamsburgs will likely be getting near equal per square foot prices as manhattan.....10 years down the pike.

truthskr10 - to your point 1 - that has been going on for quite some time, and in fact the opposite has proven true - urban areas have increased in attraction, not decreased, as a premium is now put on face-to-face communication. and while you are on macro trends which are impossible to quantify their effect on property prices, what about the move towards a lower carbon/resource footprint? Urban living is much less intensive than suburban/exurban living.

> nyc10022, sorry, but that's a pretty sh!te analogy

ROTFL. except its the ACTUAL analogy. The dip descriptions are based on the letters!
oh my lord!

> And you're still fixated on the peak "issue" though you have no real answer? Please.

Hmmm, really, you try to claim the peak is NOT the top, and its me with "no real answer". ROTFL. Dude, I just need to point out what 99.9% of the children in the world get, and you don't for some reason.

Dude, you are so full of sh*t you can't see your own toes.

printer
Is it? Or is it more just population explosion?
Not being argumentative, just asking.

I do take many studies and conclusions with a a grain of salt. Info out as good as info in.

On a light hearted note.
"as a premium is now put on face-to-face communication" though very possible I find this point hard to swallow as day by day I watch people running through the matrix with their heads buried in their communication devices, perfectly happy to text a conversation instead of meeting or speaking.

I think I miss the uncomfortable looking at the walls in the elevator everyone used to exhibit. :)

not population explosion - there has been a definite move towars urbanization - for example, in Manhattan there has been an explosion in young children b/c more families are choosing to stay rather than move to the 'burbs.

I totally agree with your other comment - though think of how many of those cell calls/texts are some variation of 'i'll be there in 5 minutes', or 'we're hanging out at bar ....'

Printer is right here. City have absolutely drawn more in the past 20 years.

In the early 90s, I read 2-3 books on "the death of wall street" and how technology was going to mean no one needed to be ON wall street. Banks moved to CT (our out of the metro). In other cities, downtowns went DEAD. Forget just Detroit, I remember St. Louis and Buffalo and Seattle and a bunch of other second tier cities that just emptied out. One firm I'm familiar with moved their Boston HQ to wellesley, and 2 others moved theirs from DC proper to Reston and Tyson's Corner. All the newer companies opened in the suburbs, and downtowns weren't necessarily bad, just ghosttowns.

Then things completely flipped starting I think in the late 90s. Lots of factors, suburbs got crowded and showed that they had their own crime and other problems. Baseball stadiums got cool and moved to the middle. Companies realized that "central" mattered (they had a LOT of trouble getting young analysts to the suburbs) and the promimity to culture, cities got safer, and, well.... NYC was suddenly on every sitcom.

That being said... thats been priced in for years. Cities are tremendously popular, and its baked into prices. So, it why prices WENT up, but not while they WILL go up.... you can make a case that it will stem declines, but to me, since its already priced in, its at best neutral, or worst case, the movement to the cities slows.

Oh, and I forgot... there is also the whole trend to "citify" the suburbs, going back probably 10 years. More commuter trains, rebuilding town "main drags", and I even read like 7 years ago about developers not building suburban wastelands as much, but doing stuff with walkable retail within the developments, with some apartments around them, bla bla.

uh oh, nyc and I agree on something. let's just all pray that the sun comes up tomorrow

"ROTFL. except its the ACTUAL analogy. The dip descriptions are based on the letters!"

What was that garbage about "water" then? But yes, going by the letters, you'll notice that just like a V, the letter W returns to exactly the same height from where it started. I was surprised to hear urbandigs (seemingly) imply that. Why are you in a tizzy and invoking the lord again?

"Hmmm, really, you try to claim the peak is NOT the top, and its me with "no real answer". ROTFL. Dude, I just need to point out what 99.9% of the children in the world get, and you don't for some reason."

"Dude," you're joking, right? When did I say peak is not the top (there's yet another of your strawmen)? I said peak involves both pricing and volume. Are you going by asking prices? Because that's been proven to be silly time and time again.

> What was that garbage about "water" then?

Uh, water is the first word I can think of that had a W in it.

Wow, seriously, get laid!

> the letter W returns to exactly the same height from where it started.

don't disagree with that at all... it just takes longer than a V, thats the point!

so why are you so freaking worked up?

> When did I say peak is not the top (there's yet another of your strawmen)?

ROTFL.

Dude, TWO WEEKS AGO!

"Uh, water is the first word I can think of that had a W in it."

Congratulations. Now, back to the actual issue. The question was for urbandigs, by the way, but maybe you've got a case of logorrhea? Your "get laid" comments are hilarious though.

"don't disagree with that at all... it just takes longer than a V, thats the point!
so why are you so freaking worked up?"

Yeah, that's all my question was asking. I don't know how you perceive that as freaking out when you've gone into all this lunacy and continue to write in all caps so frequently.

"Dude, TWO WEEKS AGO!"

I was saying the exact same thing I'm saying now, and you have yet to counter that in any actual manner if you think it's so wrong.

Just stepped on this discussion quite interesting how wall street has stayed while in our cities like Detroit, St Louis downtowns have vacated.

It is a scary thought but what would it take for all the big financial services firms to vacate wall street ?

I was thinking that maybe Obama's new proposal to tax carried interest in partnerships as ordinary income to owners might be able to, on top of removing the 100k cap on FICA might. This could possibly increase the tax of a wall street hedge fund or PE fund owner by around 26% or so. If you factor that in on top of the already high taxes in NYC would it be finally enough to move a Goldman or Morgan out of NYC for good ?

mrmet... yeh but what's the fun if you can't rub your wealth into the faces other men making $MMs less than you? Don't discount the catiness that is at its core WS. ; )

Noah,

Thanks for the valuable info in post 2. Sssuming you've got it right, it certainly debunks some of the theories being put forward now doesn't it?

Printer - was looking more west of 3rd to park - 1 or 2 bedroom. Also down in the Sutton/Beekman area.

UB,
To be fair, I follow the equities and RE markets very carefully. I could not have called this market worse. My projections were exactly like yours. I'm having a hard time accepting the realities of the moment except to say...It is what it is. As far as the RE market is concerned this recent up tick in equities as well as the general optomistic demenor of the population may only serve to draw out the deflationary period we are in. We might see prices drag along at this level for the foreseeable future. I really don't see what would drive pricing up or for the moment what might cause price destruction. It's the next in a series of Mexican standoffs. Personally......I blame the Mexicans.