Open Houses and Other Observations

Sure: there's a lot of them. According to this website, there are 1,768 open houses scheduled for Sunday. Since only 10,000 apartments are sold in Manhattan each year, that's nearly 18% of total annual Manhattan sales. And there are 9,595 open listings in Manhattan - a one-year supply. Add to that that not all properties for sale are listed here, and developers only release apartments in blocks so as not to flood the market, and there's a multi-year supply of apartments on the market.

Anecdotes are one thing; numbers are another. It still costs twice as much to buy as to rent, and there is a glut of apartments on the market. No amount of government help is going to fix that, until the affordability index comes back to equilibrium. To think otherwise is wishful - like the dot.com boom, when conventional wisdom was that startup websites were worth P/E multiples of 10,000 or more, when there was any E at all (which in most cases there wasn't).

My advice is don't bet against long-term equilibriums.

Steve, come on. It isn't right to change the topic to the rent/buy debate on every thread. Let people talk about open houses without your economic lessons. Isn't it enough you sort of ruined the last open house discussion with the same basic post you have above in your second paragraph? It isn't nice. The "Where are the idiots" thread is the discussion you want to follow with these thoughts. Postings like this discourage people from using the forums because the feel all they get are didactic lectures.

And are you so desperate to be heard that when someone posts a thread topic 3 times by mistake you feel the need to post the same response on all three? Come on.

Stevejhx, in every discussion, you keep repeating that it costs more to buy than rent. It went from 50% more to 100% more. The reality is that it's closer to 50% more before you consider the tax dedution, and only slightly more expensive after you do configure in the deduction. Now, if your argument was that after half the city gets laid off, they don't really need a tax deduction, then that I could understand that, but we're not quite there yet, and you could easily see it swing around. Hey, I'm the first to want to see prices get slashed in the city, but I just don' think your argument holds water. Also, where do see inventory at 9,595? Thought it was lower, closer to $5,600, with most sellers not even serious as they are holding out for someone to accept their miracle asking prices.

Kylewest, that's funny, and you're right, apologies for helping this guy proliferate the buy/rent debate in inappropriate threads.

Sorry guys, I'm only giving you the numbers. I'm right on topic: I say, forget about anecdotal "evidence" and look at the numbers of open houses. How many people go has nothing to do with how many people buy.

sorry about the multiple posts... got an error message so I re-posted

Yeah dmag2020, it's interesting that, suddenly, a few days ago, out of the blue, stevejhx is posting on like, every thread, regardless of it's origin, about it being 50% - NO!!! - 100% cheaper to rent than buy. Oh yes, and by the way, according to him, he made 60% last year in the stock market!!!

And somehow, he still manages to have time to post every five minutes, whether weekend or weekday.

How DOES he do it????

...methinks we have a closet bitter renter, folks....

Yeah, seems like every thread is another opening for silly season.

Bitter renter? Nope. I actually own a vacation house. Couldn't be happier. Would I like to buy again in Manhattan? As soon things come back to normal.

My market returns? Check out the returns on DPCAX, DXELX. Sorry. They're down this year like everything else, but seeing how much they rose, I'm still in the black.

And regarding the cost: $10,000 is twice $5,000 (100%); $5,000 is half $10,000 (50%). I realized it was confusing - it depends on the POV - so I tried to clarify it.

How do I do it? I'm working at my computer, take occasional breaks to read what real estate agents are trying to do to get people to think the market hasn't ground to a halt, which according to city real-estate tax revenue, it has.

Best!

Is your vacation home in Miami?

http://www.housingtracker.net/askingprices/Florida/Miami-FortLauderdale-MiamiBeach/

Could be a good reason not to sell down there right now!

No, it's on Fire Island, where prices didn't rise so quickly and so won't fall so hard. Plus I bought it 3 years ago before the real boom started, so I'm safe.

I sold my two places in Miami, the last one the day before Hurricane Wilma. I made a fortune, but kept it only a few months. My CPA told me to keep it for a year to avoid LT capital gains; I said that if I didn't sell it right then, I'd never sell it again. And boy was I right: thank G-d I paid ST capital gains, because it was far less in tax than I would have lost on the property.

I've seen a real real-estate crash, and I have friends stuck in Miami and San Diego, completely upside down and some close to bankruptcy. Experience tells me it's going to be rough going out there for some time to come.

I love real estate, but I don't see the numbers right now. If I did, I'd buy, and you could be my agent! Right now I'm just sitting tight until things calm down. I never try to call a bottom, but I also don't want to catch a falling knife.

I'm an economist by training, and a financial auditor by trade. My numbers all add up. Nobody's showed me a single number otherwise. If prices fall faster than your mortgage amortizes, you're screwed.

And they will.

I meant "avoid ST capital gains." Ooops!

Steve, sounds like it really doesn't make sense for you to buy right now. You really do get around!!

Hey if there's a bitter renter in the room, it me.

If you only knew: I lived in London, Madrid, New York, Singapore, Miami, San Francisco, all over the place. Seen a few property booms & busts in my day, as well. I plan to stay here, now, unless I don't. :)

I don't know why people are so mad at me - I'm only giving a prediction of what I think will happen. I could be wrong, but all the historical data support what I'm saying. It's an asset-price boom. I remember - before I decided to rent - that I went to an open house on lower 5th Avenue, and there was a line literally around the block to get in. I saw another place in London Terrace and there were so many bids that they were going to line all the bidders up and have an auction.

I said no - this is a feeding frenzy. Instead I bought on Fire Island where prices had remained the same for 6 years.

If you bought 3 or more years ago you're fine. If you plan on holding onto the place for a long time, you're also fine. But if you can wait a year or three to buy and have a nice place to live like I do, I see no reason to rush in where angels fear to tread.

Hey dmag2020, don't be bitter. Lots of wealthy people rent. Most of Europe rents. Think of it this way: if something goes wrong, you don't have to fix it!

Plus it's always a good idea to invest based on valuations. If you think real-estate is undervalued today & can afford the down payment, I say go for it. If not, waiting on the sidelines is exactly what you should be doing. Emotion should play no part in your investment decisions.

Steve, again: someone wanted to discuss open houses. You made this into a rent vs. buy discussion. You've done it on other threads. You have a lot of opinions and knowledge regardless of whether others agree with your conclusions. Please share them in appropriate threads.

The changes of topics by Steve and those responding in a number of threads over the past few days is a perfect example of what happens when a website doesn't have a moderator in place to tidy up the forum and adequately monitor what is going on. Much more of this and 4-5 people will be the only ones writing back and forth to each other on here on every thread. It doesn't serve the larger community using this forum and website.

I've been going to open houses of coops uptown Manhattan and also in Yorkville. Things are staying on the market for weeks. Nothing seems to be selling except for one very nice one-bedroom (reasonably priced) I saw on W. 181st . . . The places I've been interested in haven't sold, and the brokers keep calling me very nicely because i gave a nibble.