August Absorption Numbers...

Much more interested in upcoming 3rd quarter numbers, only 2 weeks to go.

Manhattan Coop and Condo totals

avg $ per sq ft---and total closings

1stQ '08 $1289---2282
2ndQ '08 $1263---3081
3rdQ '08 $1193---2654
4thQ '08 $1183---2282

1stQ '09 $1259---1195
2ndQ '09 $1056---1532
3rdQ '09 $ 996---2230
4thQ '09 $1051---2473

1stQ '10 $1038---2384
2ndQ '10 $1051---2756

3rdQ '10 $????---????

My thoughts: there is so little inventory to absorb that absorption rates aren't particularly helpful. Also, sub-$3m market is not particularly helpful as it is actually many smaller segments - the data is not fine-grained enough. For example, the $600k-ish 2-bedroom market doesn't even exist in Manhattan.

Agree that signs are not very positive for buyers.

truth - i find both of those numbers, avg. per sq. ft. and total closings are backword looking - they reflect activity from 3 - 6 months ago (that's how long it takes for properties to close here, typically). not saying they are not valuable, and i certainly look forward to them as well, but i think the absorption tells us more about where the market is headed as opposed to where it's been.

Urbandigs.com The new site should take some of the guessing out of all this and put us in the NOW.
As Einstein might say,"It's all relative." Some buyers are certainly finding this market agreeable, relative to 2007-2008, a $600-$700 dollar a square foot apartment in a doorman building is not too shabby.

Now prices would have to go down to 2002-2003 for me and the wife to afford what we desire, that ain't gonna happen; so we moved to Jersey (today.)

OTNYC
And my big problem with absorption figures is inventory is too manipulated as are in contracts.

Any guesses for 3rd Q?
I'll go 3rdQ '10 $998---2150

Errr Keith, except the new site has been in Narnia since July. And our closet doors are still broken.
Listen I love Noah and the contributions he makes to this site.
But Nobody is allowed to mention UD new features anymore until they are live. {Of course your allowed but it would be a nice new rule...no? :)}

Truth - ouch, that's pretty harsh. Working in tech, I know what Noah is and has been going through getting his new features live.

As for predictions, here goes nothing:

3rdQ'10 $1076---2650

Keith - good luck in NJ! Although I don't know where you might find a $600 per sq/ft apt. in NYC (at least below 110th street).

OT, Yes, just busting balls for the promise of the site after returning from Europe, and then referencing info only he was privy to on occasional threads here since.

Ive just been cranky here lately in general,the thought that after everything that's gone on everywhere, manahattan's 15th district might do something so insanely proper and vote goodbye to a crook.

Keith, congrats on the move. Truth, at least we got rid of Espada - but I share your disappointment with the 15th district.

"In the sub-$3MM range, all regions and price points within Manhattan are trading well under the 10 year average. In the case of UWS co-ops from $1 - 1.5 MM, absorption rate is only 4 months."

OTNYC: I think your statement reflects some accidental cherry-picking. The chart shows just one 10-year moving average (9.9 months) for all properties. Higher-priced listings inflate that moving average because they generally take longer to sell. So in any given month, lower price points are likely to cluster below the blue line, while higher price point cluster above it. Check the 2009 M-S Archive; lots of bars were below the blue line during a very grim period for sellers. (Unfortunately, the archive only goes back to August 2009.) For the range you highlighed (UWS coops from #1-1.5MM), the rate was already 5.6 months by December 2009. I would agree that the drop in absorption rates predicted the firming of the sub-$2MM sector that was observed in Q1 2010; I just don't think the comparison to the blue line is very meaningful.
http://www.millersamuel.com/charts/index.php?Node1252894604lnxeV

I don't see a simple solution to that problem. It would be difficult to calculate a meaningful, separate moving average for each price range for a long time span, in part because the product mix at each price point can change dramatically over time. To take my area of focus as an example: I'm sure that, on average, a $2MM apartment on West End Avenue sells faster today than in 2002, and more slowly than in 2007. That would be a useful thing to know, but you would still have to take it with a grain of salt. The $2MM apartment in 2002 was probably a classic eight in an excellent coop. By 2007, the same money only bought an estate-condition six. Today, $2MM buys a seven, but probably not as nice a seven as a year ago.

That said, I think absorption rates are quite useful, and most of what the August chart says about my sector is probably true. If you want to sell a nice two- or three-bedroom coop on the Upper West Side, all you really need is a reasonable price and a competent broker. (If the property is sufficiently nice and the price is sufficiently reasonable, you might not need the broker; but that's a topic for a different thread.)

I'm not convinced, though, that an inventory tsunami is the only thing that can stop the UWS juggernaut. At some point, substitution will narrow the disconnect between us and other neighborhoods with stronger inventory. After a buyer loses a few bidding wars in the West 90s, Carnegie Hill or Yorkville can look pretty attractive.

understandable..but this project has been hell to do correctly. As for absorption rates, that and Cumulative Days on Market (not DOM) are 2 charts we are still discussing methodology for. We likely will add these two charts to site about 1 week after launch. Got too many items to finish first so we can get site live for Sunday evening.

Think about Absorption Rate..do you use avg closed sales for past 90 days, 180 days, or 365 days? I think JM uses annualized sales pace. I think we are leaning towards avg monthly pace for past 90 days to make the metric more sensitive to real time market shifts. Since we do have alot of transactions here and enough data in inventory, I think its fine to measure it this way. As for DOM and CDOM, days on market tends to be too loose a metric. Rather, if a listing is ACTIVE for 6 months, then removed for 1) 2 weeks, 2) 2 months, 3) 4 months, 4) 6 months, 5) 8 months, etc...when should the DOM counter reset? If its under 4 weeks off mkt, should that time be counted? When you data mine 210,000 listing records with millions of broker status updates, these are all the things you must account for.
We already scrubbed data + flow algo governs our entire system db so that no 1 listing is counted in more than one state at any given time. That in and of itself is the key.

Moving on. I think we will capture Absorption by Current Active Inventory / AVG monthly sales pace using past 3 months sales. We can use days for sales pace to keep it real time. For Cumulative Days on Market, we are leaning towards a counter reset for sold/closed or if unit is off market for 3 months. If unit is only off market for 2 weeks, we may include that as 'on market' still. Think about all listings that either by error or on purpose are ACTIVE for 6 months, then changed to off mkt for 3 days, then back ACTIVE updated again for 2 months before selling. Are you saying the 3 days shouldnt count? These are the little things we still are ironing out for these 2 metrics. Everything else is done. What say ye?

Not to be difficult but isn't absorption rate fundamentally a measurement of appropriate pricing and seller expectations? If so, what does this number really tell yup about the market?

its a strange way to measure supply / demand based on pace of sales. Since sales are recorded at a lag, it wont be real time. All metrics are in some way a measurement of appropriate pricing. If Inventory spikes 30%, can we argue that prices are not in line with where buyers deem they should be? If pending rises 30%, can we say prices are appropriate? Personally, I like our Active-to-Pending Sales ratio, and ultimately we will design an index that takes into account 3 types of market movements: active inventory vs pending sales vs off market trends all together for one index. If anything, we should look at movement of inventory across a few metrics to paint a picture of market trends, not any one means of measurement

Thanks for the good wishes with the move! I sit here in my "sun room" with 8 big windows looking at trees, still on SE...some things don't change.

I have to say I was really worried about this move, I have been in NYC for 26 years.But it feels really good, sort of feel lighter. If you are on the cusp, fear not and just do it.

Based on Kylewests strong recommendation for flatrate we chose them over a few others and are very pleased with their service. 100% professional,on time- great crew (lead by Roberto)and they also gave us the lowest estimate.

OTNYC-It's below E.86th street, they are out there.And a rebate of 50% of the buy-side commission is just the icing on the cake..

My anecdotal take is it was a slow summer, I had two signed contracts during July and August. Because there is no real time data we can only guess where we are going. The problems we(the world) face are significant, so I just can't see any reason why we would see any kind of buying "frenzy" this Fall. What would drive such a thing? That said, the world did not end, rates are cheap and prices have fallen and if you have patience you can find a reasonable deal on home, with a 7-10 year horizon all the better.

I would expect to see more listings come on over the next few weeks and if the pace of sales does not pick up we will see prices fall. Generally speaking under these relatively "stable" conditions, no one has yelled fire in awhile, so the process will be gradual until each individual apartment finds it's price. I have to ask myself why would we expect the other shoe to drop? It would appear the NYC employment situation is fairly stable, if you are still working but bought a place at peak, most likely you will ride it out, like so many buyers did who bought in 1987 or sell it at the current market price and eat the loss and go on with your life.

I am now asking myself, have we been through the darkest of the storm? When you read Faber, Roubini, west67th (; it will scare the hell out of you! In January 2010 I was thinking we would know more by August, now I am thinking let's see where we are in mid January 2011. But at least in the moment things ain't too bad....

UD
Excellent points,and thanks for pointing out some of the flaws. I noticed several "new listings" lately that were actually old listings pulled from the market around last march and april, and now relisted. Some have a new "file" so they show up as duplicate units in SE building histories and seem to be an attempt to appear as a brand new listing.
I wondered how these are treated in the absorption "field."

{PS, Hope you did't mind the delayed 2.0 launch tease.}

its ok..I just really hope people understand WHY this took me so long. It was all data integrity issues and properly measuring each item. In the end, trust in the analytics was of highest importance to me. There are tons of places to track analytics and market reports, we wanted to address all these little things, and there were 100s of them.

Its only the last 4-6 weeks we started to build the front end and registration systems. All I need to do now is set registration permissions, fix final browser display bugs (so annoying), hook in paypal payment systems, and connect blog elements so all blog functionality/images from old site works on new servers.

We had to postpone completion of a few charts to launch sooner. Sucks. So we consider this a soft launch, with more features to be added in 2-3 weeks after launch.

ps: those are treated with the NEW DOM tag. so it would not count the prior time on market. That is why its better to take the time to do it right, then to rush it out and revise and regenerate all charts later.