NYC boasts nation's lowest vacancy rate in 2010

"plus relatively high job growth"

Completee bull. NYC is still losing jobs.

steveF: you fool. don't you know by now, that in the world of Streeteasy "talk," bad news about NYC is bad, and good news about NYC is wrong.

It's not bad news. It is just bad logic.

It doesn't mean prices aren't still going down. Because NYC already has... by far the highest prices. So it needs all of that just to justify the current state.

It's like saying Google stock is going up because it is by far the #1 search engine. Of course, that is just not logical... particularly when it is already factored into the stock price. Google can be head and shoulders above everyone else and still lose stock value, if only for going to slightly less head and shoulders.

In the end, these are the factors that contributed to NYC's price growth. It needs all of them just to not fall (and is falling with those factors already in place).

swe, well the article states that they expect rental asking prices (which does not preclude discounts or concessions obviously) to increase 6%. Paired with apparent job growth, I'd actually say this is a bit of good news for a change.

Rents could double, and still be cheaper than buying. This is a clear indication that prices still have a long way to go.

Rents can't rise 6% unless incomes rise 6%. They haven't. Looking at rents overall is silly; you need to look at rents on a same-apartment basis, b/c most of the new rentals coming out are uber-luxury with things like, uhm, running water. Go out to the hinterlands of Long Island City, where you ladle your water from the Newtown Creek, and the picture is entirely different.

Best regards.

>Rents can't rise 6% unless incomes rise 6%.

This is a law? Like gravity?

whoa stevieF... you think NYC is somehow unique?

NYC = Wayne, NJ
All of California = Mediterranean

Wait, I thought NYC = Miami-5yrs, or NYC+5 = Miami/vegas

Correction: Only SF is Mediterranean.

IMO the reason why Manhattan fell quickly and recovered fast in late'08/early'09 was because of one factor. No Subprime borrowers. Bless those pain in the ass Coop boards and to a lesser extent the condo boards. When money was flying off the shelves those people stuck to their guns and stayed the course, not allowing subprime.

Anyhow, the real factor, I feel and have always stated, concerns inventory. I am betting that inventory levels will be at historical lows for the next few years due to the above mentioned credit crisis(building stopped). Manhattan always needs an influx of new units and that has been halted. Supply is so important. The lack of supply will drive up prices for the next 3 years. Place your bets! :)

Hey MidtownerEast. Did you ever have a point of view you could express on that Virgin guy who posted for the first time? Oddly, you post a lot but didn't seem to have an opinion on that thread:
http://streeteasy.com/nyc/talk/discussion/24949-virgin-post-calling-all-finance-geniusestrolls

I think there is some weight to this; datawise this is the second story I've seen about the lack of inventory due to the halt of construction (plus I believe - but correct me if I am wrong - Noah's latest stats indicated January inventory was the lowest it has been in the past 4 yrs) and anecdotally I have had a few friends mention they are looking to buy but there is nothing good on the market/they wonder if spring will bring a change.

Technologic, the number of new listings was the lowest, but the overall inventory is higher than last year (I don't know about previous years.) As a sideline buyer, my anecdotal observations about the inventory in "my" market are that new listings are coming on at very low prices (lowest in 5/6 years) for places that need lots of work/have severe downsides and at very high prices (peak pricing) for places that are nice. None feels compelling. I am not confident we've hit bottom, and not rich enough not to care.

"Rents could double, and still be cheaper than buying. This is a clear indication that prices still have a long way to go."

You've been saying this for years, yet prices have dropped. I think you exaggerate greatly.

"Rents can't rise 6% unless incomes rise 6%."

steve, your rigidly formulaic world is not reality. If it were, we would never have had a bubble. Equilibrium is a rare (and often short-lived) event, and incomes and prices rarely move in tandem. I completely agree that long-term increases are not sustainable unless incomes eventually catch up, and if this article's estimates are right, we're looking at more jobs and (somewhat amazingly) increased foreign investment. Though I highly respect Crain's, the report they're citing comes from a commercial brokerage, so there's likely some bias in there. Still, your apparent outright dismissal is too couched in your completely formulaic viewpoint.

techno/maly, I think there's been some compelling anecdotal evidence around here that we've seen compression towards the lower end; as a result some buyers are seeing next to nothing that fits their criteria, while others are seeing plenty but still way overpriced. Strange market right now.

Maly - thanks for the correction.

I agree with part of your assessment. In the building I watch most carefully a unit just went for 2007 peak price (had a prime reno kitchen but I was still surprised). Other units in the same building which are definitely not as nice are (a) being listed for about 8% off peak but (b) are being listed at higher prices than I saw 6 months ago and have gone into contract rather fast. I am interested to see what the closing prices are and then I will be able to make a better assessment of things.

In the larger market that that building is part of, it seems to make no sense to me. I see listings at very low prices and then listings at very ambitious prices. It is hard to tell what is going on.