Has Manhattan Bottomed Out?

Buy now or be priced out forever.

I think the bottom is approaching but we're not there yet. But what do I know? Just another lemming...

InvestNYC Scr, you oughta do standup comedy!

i don't think you can even think about a bottom until the new construction issues are resolved. these types of corrections can take quite a long time, with ups and downs until the dust finally settles.

LOL - can I read your palm? You will know that prices have bottomed when it's all over. As many have suggested, it may be safer to buy in after years and years of stagnation and then modest price increases.

I'd say it does seem to be stabilizing right now but it may be the eye of the storm. If the stock market tanks again (a double dip recession scenario, which many would agree is a distict possibility) you can bet real estate will follow suit. Just my 2 cents.

We are looking to buy new construction (condo) in Brooklyn and it's still too high for us. Shouldn't the affordability index go down a bit more in NYC before it bottoms?

Everything from the last quarter indicates prices are stabilizing, look at the activity its way up at decent price levels.

Im a huge bear and personally think that the market is NYC is totally F@CKED. I believe the brokers have rigged the market and are effectively price-fixing.

I know everybody here is a doomsday naysayer but on the flip-side, a lot of the predictions posted here a few months back still have not come true. Is it possible we are wrong and things are better than we think?

i wouldnt consider it "bottom" until buying costs approximately as much as renting a comparable place

no, it's possible that the gov't is committing trillions to keep housing prices elevated. the jumbo market here is woeful.

why anyone would want to buy when the gov't is inflating a market is beyond me. and we're seeing 2004 pricing in many cases. if you adjust for inflation, the drop has been quite steep.

then there's the turd in the punchbowl. new construction, both to buy and to rent. speaking of the rental market, have you noticed it's not looking so healthy right now?

> It seems prices are starting to level off

Based on which data? The one that showed they fell again?

Or what your broker told you?

nyc10022- based upon first hand accounts of the market. I have a lot of colleagues who are attorneys, brokers and mortgage bankers and all are noticing the same thing.

Aboutready- im not sure govt intervention has too much to do with the nyc market,most of the programs really have no affect here.

Inventory is still historically very high, and creeping back up. Affordability is still below historical average. Rents are down. People are making less, there are fewer jobs in NY. No one is moving here. New construction buildings across the city are not finished or sold out. Prices rose for ~15 years and have been dropping for just 1.

How is there a bottom???

I saw this in late 07 in the debt markets. The market froze up and collapsed in the summer. Come October a lot of smart money thought the worst was over and poured billions into corporate debt. They all lost their shirts in 08. Double dip, dead cat bounce, call it what you want. Personally, I'll let others test the waters first. Let me know how it is.

investNYC have you noticed the huge numbers of smaller units sold recently? the conforming loan market is most certainly affected by the purchase of rmbs by the Fed and the unnaturally low interest rates.

gov't intervention absolutely affects prices in NY. mortgage rates are being kept artificially low by massive gov't buying and the loosest monetary policy in history. You haven't heard any brokers say "Now is the best time to buy, rates are the lowest ever!"

"nyc10022- based upon first hand accounts of the market. I have a lot of colleagues who are attorneys, brokers and mortgage bankers and all are noticing the same thing. "

Yes, same folks who missed it last time, too.

The ACTUAL data shows prices continue to decline.

> Double dip, dead cat bounce, call it what you want

You need an uptick to even have a dead cat bounce!

but so far, all we have are ticks down...

I would say 20 percent more to go down before I would feel ok with looking again. NYC is still lossing jobs with no sign of that stoping it would be dumb to buy.

'based upon first hand accounts of the market. I have a lot of colleagues who are attorneys, brokers and mortgage bankers and all are noticing the same thing. '
OH, this pains me so...
My dear boy, had you focused your attention foward when logic was offered somewhere during your education you would have automaticly known that from a specific you can not draw a general.

How a fool and his money ever got together in the first place.............................

Which market are you asking about? Rental? Sales? Or both?

Sales definitely not. Rental? You would think so, but all I see right now is a pause.

Sales market can't bottom until the rental does.

Let's see a quarter with stabilized rents and then we can talk about sales.

and to your question..........no (prue opinion)

My humble view: no point discussing "stability", or "bottom"...etc..until...until..the problem new construction buildings, which have lots of empty units are sorted out,i.e. sold out to a normal degree as one would find in a normal market, AND including the buidlings in fidi, or wmburg, or anywhere else that constitutes, for many potential buyers, a substitute product for prime Manhattan.

In the lower end of the Manhattan mkt, <1mm, yes the market has seen a bottom - it came in the spring when buyers had maximum leverage, and prices are up very slightly since then (<5%). Will it be THE bottom, is something we won't of course know for some time - certainly a double dip in the economy and a resumption of large scale layoffs in finance would trigger it. Interesting to note that NYC has only seen 1/2 of the expected layoffs in finance, which could mean the other 1/2 are still to come, or the worst expectations didn't come to pass.
The much vaunted spike in post-labor day listings (and re-listings) has not occurred - according the UD's site, we are up only 2-300 units this month.

In the mid (1-5mm) range it seems we have more hit a level and remained there, or continue to slowly drift lower. I would expect to see more movement there in the spring after bonuses are or aren't paid (despite all the gloom on this board, a lot of people have had great years - whether and how they are paid out is still to be seen). And most new construction falls into this range, and we still haven't the defaults that will lead to new ownership/price chops here. You'd have to have intimate details of the finances and loan terms of those projects to know how much longer the developers can hold on, something I certainly don't have, but they are in most cases so far out of line with the clearing prices on existing places that big adjustments are inevitable. I think that there is a lot of room for them to move down before they actually weight on existing prices, but many here would say that any move down will affect all prices, something I don't see.

On the high and very high ends, I have no idea - out of my league.

hmm, post got badly cut off. basically, low end (<1mm) has seen a bottom. THE bottom? only time will tell. middle (1-5mm), stabilized but weak, dripping lower. above that I don't know - out of my league.

"My dear boy, had you focused your attention foward when logic was offered somewhere during your education you would have automaticly known that from a specific you can not draw a general."

Given the fact that the guys is is in /related to the re industry, it doesn't surprise me that he might not have much of an education at all....

"In the lower end of the Manhattan mkt, t see.
On the high and very high ends, I have no idea - out of my league."

Its funny how the "well, the low end is fine..." rationalization, CLEARLY flying in the face of the old bull logic of "well, there might be declines, but PRIME..."

nyc10022, we are having a discussion, there is no reason to start throwing insults around.

"In an important sign of confidence beginning to return to the property market Related Cos. announced Tuesday that it will
resume construction of its massive 1.2 million-square-foot mixed-use development in midtown Manhattan. The mega project was
put on hold due to the collapse of the market late last year."
http://www.crainsnewyork.com/apps/pbcs.dll/article?AID=/20090929/FREE/909299992/1058

Re: "In an important sign of confidence beginning to return to the property market Related Cos. announced Tuesday that it will
resume construction of its massive 1.2 million-square-foot mixed-use development in midtown Manhattan. The mega project was
put on hold due to the collapse of the market late last year."

funny how when Goldman (the devil) becomes an investor, the project resumes. wonder who paid off who

InvestNYC.... That was actually a falcogold quote, I was just running with the joke...

That being said, if your "evidence' is that a bunch of people in RE industry told you so, the intelligence level of that group would certainly need to be a factor in assessing validity.

That same bunch is on record with some of the most horrible calls in history.

Streeteasyaddict says that inventory is still historically very high. Is that in a particular price range or category? I'm hearing the opposite, which is why I ask.

It seems that we see the "facts" only through the filter of which camp we reside in - that things will get worse or that things are getting better, but can't both things be true? If you're a cash buyer, I think things look different than if you need a big loan, and things are probably also different depending upon neighborhood, price range, who you talk to and what side of the bed you got up on today...

Consider the source. The folks saying "its getting better" were the same ones who said it was a year ago.

The data shows... inventory up again.... more new listings than sales... and the median declining AGAIN.

nyc- i understand... Its not just a bunch of here-say, I know of specific deals. In my building, in Tribeca, UWS. Things are trading at decent prices. Its quite an anomaly. There are a decent amount of foreigners in the market paying cash. Maybe the low dollar has pulled some back from the sidelines?

what complete garbage--none of what you claim to "know" cant be even remotely substantiated

tell me the data nyc10022 cites is bullish if youd like, but dont start with completely anecdotal crap

Yes, the crash is over! Its been confirmed! Some guy knows a lawyer who knows a broker who sold an apartment!

Christine Toes is back!

I am looking at the market everyday, and I don't notice things bottoming out. I see more foreclosures/shortsells/REO and public auctions lately in NYC (is it just me noticing? anyone?), which will put more downward pressure on prices. It's still going down. Don't listen to the real estate brokers/agents telling you things are picking up/bottoming out. Some of them are still calling regarding units - which they said had offers on it (but was a little off from the asking price) several month ago.

my mother has a cousin that's married to a guy whose wife is best friends with a women whose husband's brother commutes to work with a lawyer who works in an office with another lawyer who deals with real estate and, she has it a good authority that the bottom is in. So there.

i think my husband's cousin's best friend's brother-in-law's hairdresser said the same thing.

With 400,000 unemployed how in the world could this be the bottom? You can't get into an apartment that costs more than $729K, unless you have at least half the purchase price in cash, a steady job, and perfect credit. We are lower in 6 months. No way are we higher.

ummmmmmmmmmmm.....NO! market goes lower.for the plane simple reason that the financing options that used to be available are gone forever.

"I am looking at the market everyday, and I don't notice things bottoming out. I see more foreclosures/shortsells/REO and public auctions lately in NYC (is it just me noticing? anyone?),"

As you know, I follow this intensely, and I'm really not seeing a big uptick in foreclosures. but I think there are 2 HUGE reasons for this: 1) there are a lot of would be foreclosures which are now being done as short sales (which really sucks for me, but I think is better for the market), and 2) People not paying their loans aren't getting foreclosed on. Every day I'm hearing about more and more owners who aren't selling because they can't hit "their number", aren't paying their mortgages, and aren't getting notices from the banks. In some cases I've seen OVER A YEAR and still no foreclosure.

And the "problem" with short sales is that it's easy to track foreclosures, but VERY hard to track short sales.

"Im a huge bear and personally think that the market is NYC is totally F@CKED."

And my response to the OP was that I know a lot of people who own recently purchased property may feel like THEY have recently bottomed.

30 yrs, I know you are the real expert here, but I have been noticing few shortsales in the other sites (you know, the ones that categorizes foreclosures, and shortsales etc, requires monthly fees to see the details?) for ex-harlem Manhattan units, advertised here too in streeteasy, except that they don't say it's a shortsale in streeteasy. It's usually the ones that is priced at the bottom of the price range (ex, $600s/ft). However, the ones being sold at a public auction are not on streeteasy, and I noticed there were quite a few of them during the last few months compared to before? Again is it just me?

I had a question though. I read that shortsales are priced competitively because there is a time constraint, a need for the distressed seller to sell it by a certain period of time. BUt as its for the foreclosures in NYC, because of the different state law(?) and provided that no one picks it off the market right away, does it take longer for shortsales to clear in NYC than other states?

Well, firstly when choosing Harlem, you're picking the area where the most activity of this type in going on in Manhattan, hands down.

There are a lot of issues, but I think the simplest answer I can give is that with a short sale you have a distressed seller who is going to get foreclosed on soon. Once a unit has been foreclosed and is owned by the bank, there's no distress anymore: it's just inventory. So the bank can take as long as it wants to sell it.

The reason you don't see the foreclosure auction sales listed on SE are they aren't "listings" yet in the way SE defines a listing; they are coming up for auction and many will not make it to the auction so a LOT of what you are seeing as foreclosure sales never actually happened.

thanks (....btw by ex-harlem I meant, excluding harlem)

ooops.... sorry.

I have been tracking Harlem foreclosure sales for 1 year. Here is my observation
1) Most of these properties have loans in excess of what I would consider fair values. They come to auction and no one bids it up to the loan value. Bank takes it back. Make offers to bank that are reasonable but below loan value and in most cases they are turned down. They sit on it and rotate.
2) for properties that are not in the condition in 1st sentence in 1) they sell for loan value or a tiny bit more. These often have multiple tenants
3) Those that fail 1) or 2) are being sold on short sales -- often for much less than loan value, but through a protracted process that can take over a year, or so the realtors tell you.
4) Many of these auctions dont happen -- the date comes and the owner gets a reprieve somehow. I know one that has now undergone 9 consecutive cancellations.
Several of the successful lowballs that people report on the UWS do seem to be distressed properties but I have not figured out yet how to discover this condition pre-sale, especially for coops.