Is NY now best of breed?

New York state or Manhattan? Because certain actual cities in SoCal had better YOY increases than "California" or "The Los Angles Metro area." And than Manhattan.

2.67% is for NY State; NY metro (the infamous NY, NY-White Plains-Wayne, NJ) is up 1.86%, and yes, before someone asks, it's for houses.

For reference, the famous Streeteasy Manhattan condo index was up 4.71% y-o-y in September 2010.

maly, that is impossible. NYC, I am told, is following the exact trajectory as LV, Phoenix and Miami, only 2yrs later. And all of those areas fell YoY in 2008 from 2007, so NYC must have also. That there is no evidence for this thesis is irrelevant. That those places had 1-2yrs of a plateau before falling slightly then plummeting, and NYC had a 6 month peak followed by a sharp fall followed by a bounce is irrelevant.

Printer, I think that was the early wisdom. But with all the government money thrown at the banks a bunch of it has wound up in real estate the conventional wisdom that we're just two years behind no longer makes sense. At this point, the only thing that would upset the apple cart is wall street doing worse than expected.

Printer, that's why I try never engage in predictions about the future! Too easy to be wrong by forgetting things don't happen in a vacuum. That said, I am as surprised as any bear things are holding so well in NYC.

i really don't think we have any clue yet what will occur.

I agree with that. Prediction is way too difficult, especially with regard to the future.

Predicting the future and market timing aren't so far off.

hb, put it this way. i think things will eventually tank. but when and just how is always the question. in terms of market timing, it is not a particularly good idea to become an active participant in a real estate market that has so much potential risk. risky markets can produce huge gains if played properly, but only liquid ones.

I know I will eventually die. When and how is a question.

so will you speed the process along with bad decisions?

I also know that 8 months from now, the weather will be beautiful and the days will be long. 14 months from now, this city will not be at all pleasant.

that's fine, but if it's not you're not on the line for hundreds of thousands of dollars in lost equity and transaction costs. it can be a humid, fetid stormy summer and the only thing you'll have felt is annoyance and inconvenience.

I agree. Also if you don't have malignant cancer, if you aren't blind and deaf, if you didn't catch your hand in a taxi door, if your mother in law doesn't keep questioning your parenting, and if you don't have a loved one in a war zone, then you'll have a happier summer.

A.R. is manic depressive,
but raises a good point.
In a world where most assets are over-priced what does one do?

Bonds and Stocks are clearly over-priced(bonds slightly more than stocks).
Money yields nothing and loses purchasing power but has the virtue of optionality.
Real Estate is protected long term by rising replacement cost and tax deferred growth, but hurt short term by excess supply

and commodities benefit from Fed policy, inflation and a depreciating dollar but risky by their very nature.

What does one do?

Overpriced by what measure? What does overpriced even mean?

I mean, if each of the assets you mention can be sold to someone else on an arms-length basis at this "over" price.

My own feeling is that one avoids leverage. Keeps their home, holds above average cash, below average stocks and the rest in laddered high quality bonds.

I can't see real estate rising enough to justify leverage or buying too much house, but I also see as having a cost advantage over renting.

What is the one properly priced asset if all of the other assets are "over" priced?

Overpriced by what measure? What does overpriced even mean?

That's legitimate I'll answer.
On a dividend discount model assuming dividends increase 6% a year and return to long term average yield stocks as a class are expensive. Over ten years that model assumes break even. Bonds are worse and have negative real yields.
2-3% on a treasury is return free risk.

So all of the assets are overpriced relative to cash. Except that cash doesn't seem to be worth that much because you can't buy much stocks, bonds or real estate, right?

RS, what makes you say stocks are clearly overpriced?

Dividend discount model. long term we're below trend(less than 2% compared to over 3%)
Also stocks are not at their cheapest p.e. especially if one assumes earnings last year benefited from inventory replenishment and cost cutting. I'm with Hussman on this one, I like his argument. If you have to buy stocks stick with large cap growth like KO & JNJ as examples.

How many years into the future do you need to go to get a reliable dividend discount model?

The more years you project forward the more likely you revert to the mean. If you're trying to guess the next six months, you might as well spin a chicken.

Huntersburg,
If you are looking for a more precise answer...Well I haven't the foggiest.

Oink, Oink -- The SE pig has a "bauble" property, upstate.

psychology is another area in which you don't excel, rs.

shouldnt you stay focussed on steve? or are you becoming dual obsessed?

"Being a new girl in New York is a lot to process. Your dopamine receptors are haywire from so much of what feels like the right kind of attention."

http://opinionator.blogs.nytimes.com/2010/11/17/all-the-young-girls/?hp