2004-2005 Prices

Oh, and as mentioned earlier... overall Manhattan is off 16.6% from Peak (vs. 23.7% max)

and your conclusion is?

I thought it was obvious... I was right.
;-)

Seriously, I thought the title was the conclusion... though in real terms, it might be earlier. ANybody have a good inflation tracker?

i did too

Wow, that's sobering. Thanks for your efforts.

http://www.bls.gov/data/inflation_calculator.htm

$100 in 2004 is worth about $120 today.

> Wow, that's sobering. Thanks for your efforts.

Glad you enjoyed.

I'll try and do the real dollar version soon... but, yeah, we probably lose another year or two with inflation.

It feels like there are two data errors here: one is to make it apples-to-apples you should use PPSF numbers, not medians; the second is that inflation as a whole doesn't matter -- it's the cost of money, as represented by interest rates, that matters. I don't have time to go on the Miller Samuel site, but the first correction should make the data look better, and the second should make it look worse.

ali r.
DG Neary Realty

"it's the cost of money, as represented by interest rates, that matters."?

Not two errors. Just the one. Had Harvard known you'd take their degree and become a re Borker who doesn't understand inflation adjusted prices are the same from 2002 to 2012 on a psf basis, they'd want their degree back.

"It feels like there are two data errors here: one is to make it apples-to-apples you should use PPSF numbers, not medians"

Nah, that would make too much sense. Why make sense when you are trying to convince everyone that 3 bedrooms in Manhattan are down 48%. Just by including that number and stating that the "conclusion is obvious" would tell me the OP doesn't care about facts.

Here is the streeteasy inflation adjusted series assuming 2.5% inflation. We are at Mid 2004 prices for streeteast condo index.

Second column is SE index.

Third column is todays index value in deflated terms for each historical month.

Lower interest rates mean easier affordability which means that in affordabilty terms we are even cheaper than Mid 2004. Precise effect of rates is harder to strip out as people have the option to pre-pay, which means that historical affordability will need to be adjusted for this option. Rough calcuation of interest rate impact assuming 7 year duration (much lower that actual mortgage to offset some of the effect of ability to pre-pay) and 1.5% (adjust for tax effect as your deduction reduces with lower rates) cheaper rates is another 10% below Mid 2004 prices. However, this 10% effect is partially offset by slower economy and job prospects relative to 2004.

Yearly Inflation 2.50%
Monthy Inflation 0.21%
Month Manhattan Nominal Current Price Deflated
Nov-11 1879.49 1879.49
Oct-11 1885.14 1875.630
Sep-11 1892.69 1871.779
Aug-11 1888.91 1867.935
Jul-11 1909.8 1864.099
Jun-11 1905.99 1860.272
May-11 1909.8 1856.451
Apr-11 1885.14 1852.639
Mar-11 1881.37 1848.835
Feb-11 1894.59 1845.038
Jan-11 1900.28 1841.250
Dec-10 1898.38 1837.469
Nov-10 1890.8 1833.695
Oct-10 1887.02 1829.930
Sep-10 1885 1826.172
Aug-10 1909.8 1822.422
Jul-10 1894.59 1818.680
Jun-10 1881.37 1814.945
May-10 1840.43 1811.218
Apr-10 1847.81 1807.499
Mar-10 1842.27 1803.787
Feb-10 1816.66 1800.083
Jan-10 1793.2 1796.387
Dec-09 1794.99 1792.698
Nov-09 1793.2 1789.016
Oct-09 1802.19 1785.343
Sep-09 1798.58 1781.676
Aug-09 1814.84 1778.018
Jul-09 1833.08 1774.367
Jun-09 1855.21 1770.723
May-09 1888.91 1767.087
Apr-09 1877.61 1763.458
Mar-09 1877.61 1759.837
Feb-09 1932.86 1756.223
Jan-09 2015.77 1752.617
Dec-08 2079.23 1749.018
Nov-08 2117 1745.426
Oct-08 2106.44 1741.842
Sep-08 2138.28 1738.265
Aug-08 2119.12 1734.696
Jul-08 2155.45 1731.133
Jun-08 2131.87 1727.579
May-08 2142.56 1724.031
Apr-08 2129.74 1720.491
Mar-08 2164.09 1716.958
Feb-08 2117 1713.432
Jan-08 2070.93 1709.913
Dec-07 2066.8 1706.402
Nov-07 2106.44 1702.898
Oct-07 2153.3 1699.401
Sep-07 2155.45 1695.911
Aug-07 2127.61 1692.429
Jul-07 2095.94 1688.953
Jun-07 2058.55 1685.485
May-07 2015.77 1682.024
Apr-07 1975.85 1678.570
Mar-07 1952.28 1675.123
Feb-07 1946.44 1671.683
Jan-07 1944.49 1668.250
Dec-06 1960.11 1664.825
Nov-06 1985.76 1661.406
Oct-06 1993.72 1657.994
Sep-06 1983.77 1654.590
Aug-06 1981.79 1651.192
Jul-06 1954.24 1647.801
Jun-06 1952.28 1644.418
May-06 1940.61 1641.041
Apr-06 1960.11 1637.671
Mar-06 1940.61 1634.308
Feb-06 1915.54 1630.952
Jan-06 1934.79 1627.603
Dec-05 1950.33 1624.260
Nov-05 1991.72 1620.925
Oct-05 1977.83 1617.597
Sep-05 1958.15 1614.275
Aug-05 1934.79 1610.960
Jul-05 1915.54 1607.652
Jun-05 1873.86 1604.350
May-05 1816.66 1601.056
Apr-05 1786.04 1597.768
Mar-05 1764.73 1594.487
Feb-05 1733.25 1591.213
Jan-05 1688.77 1587.945
Dec-04 1676.99 1584.685
Nov-04 1670.29 1581.430
Oct-04 1682.03 1578.183
Sep-04 1676.99 1574.942
Aug-04 1668.63 1571.708
Jul-04 1625.8 1568.481
Jun-04 1569.88 1565.260
May-04 1508.33 1562.045
Apr-04 1465.21 1558.838
Mar-04 1446.29 1555.637
Feb-04 1433.33 1552.442
Jan-04 1414.82 1549.254
Dec-03 1389.58 1546.073
Nov-03 1384.03 1542.898
Oct-03 1349.86 1539.730
Sep-03 1352.56 1536.568
Aug-03 1339.1 1533.413
Jul-03 1381.27 1530.264
Jun-03 1357.98 1527.121
May-03 1341.78 1523.985
Apr-03 1232.44 1520.856
Mar-03 1267.44 1517.733
Feb-03 1275.07 1514.616
Jan-03 1381.27 1511.506
Dec-02 1397.94 1508.402
Nov-02 1433.33 1505.305
Oct-02 1496.31 1502.213
Sep-02 1472.56 1499.129
Aug-02 1426.18 1496.050
Jul-02 1344.47 1492.978
Jun-02 1307.35 1489.912
May-02 1281.46 1486.853
Apr-02 1289.17 1483.800
Mar-02 1275.07 1480.753
Feb-02 1236.15 1477.712
Jan-02 1231.21 1474.677
Dec-01 1228.75 1471.649
Nov-01 1264.91 1468.627
Oct-01 1252.32 1465.611
Sep-01 1261.12 1462.602
Aug-01 1276.34 1459.598
Jul-01 1259.86 1456.601
Jun-01 1253.58 1453.610
May-01 1225.07 1450.625
Apr-01 1249.82 1447.646
Mar-01 1249.82 1444.673
Feb-01 1220.18 1441.707
Jan-01 1200.81 1438.746
Dec-00 1190.06 1435.792
Nov-00 1193.63 1432.843
Oct-00 1179.39 1429.901
Sep-00 1152.58 1426.965
Aug-00 1154.88 1424.034
Jul-00 1159.51 1421.110
Jun-00 1156.04 1418.192
May-00 1123 1415.280
Apr-00 1076.81 1412.373
Mar-00 1039.77 1409.473
Feb-00 1017.15 1406.579
Jan-00 1000 1403.690

Mercedes just said we ARE AT 2004 levels, meaning that crazy azzed ride to 2007 has been flushed out... thank goodness it's all over and we can re-pump it or at least maintain 2004 levels forever....

Whew! Everybody back in the pool, the floater was indeed a long POS , but mercedes thinks the water is clean.

>but mercedes thinks the water is clean.

Not as clean as your wife who, according to you, has been touched by thousands.

Love that scene. I've got an autographed picture of myself with Bill Murray in my old building... on an inflation adjusted asset price... I"M FKING RICH!!! That picture will ebay for $150K! Heck, if studios selling for $100K are worth $1MM... that picture gotta be worth at least a PORSCHE. Who wants an autographed picture of bill murray with a young w67?

email me m'okay.
w67@ gmail.com

w67, I like the nick name. Trying to see where in this post I opined on the direction of the real estate. Is this your paranoia about prices going up?

w67thstreet was a TA in business school.

mercer: i assume you now understand who hunters burg is.

mercer: I assume you now understand who w67thstreet is.

I also assume you don't care who columbiacounty is, for which I and the rest of streeteasy don't blame you.

what's wrong with being a TA when you were in B-school HB?

300_mercer, based on those numbers it would suggest that we are ~13% below peak. Not really a tank.

>what's wrong with being a TA when you were in B-school HB?

Nothing.

Nothing is wrong with owning a Porsche or a yacht or a Rolex either. Nothing is wrong with bench pressing a lot of weight and squatting a lot of weight. Nothing is wrong with having a humble background and making beaded jewelry with your mom. Nothing is wrong with your wife being an oncologist.

Not sure why all of that needs to be bragged about either.

ohh

"Not really a tank."

that's all relative. If you have to sell your $1mm apartment. taking a $130k hickey before transaction costs will feel like a tank. especially in this great new economy..

"the second is that inflation as a whole doesn't matter -- it's the cost of money, as represented by interest rates, that matters."

Nope... that is just wacky.

I can buy the same apartment at a lower price now... and at an even lower price in real terms. Ignoring the latter part is wishful thinking to those who need to pretend there wasn't a decline. My money goes further now.

And to those who bought, even if money was free during that time... their apartment is worth that much less.

"hat's all relative. If you have to sell your $1mm apartment. taking a $130k hickey before transaction costs will feel like a tank. "

Don't forget even more in real terms...

"It feels like there are two data errors here: one is to make it apples-to-apples you should use PPSF numbers, not medians"

Nope... you are just trading one data issue for another and pretending you don't have any... it isn't apples to apples if you use PPSF either, as you assume all apartment types are the same as well (and locations, and everything else).

The overall medians aren't perfect... but they were what was used on this board when things were good...

For me, its more about saying "this is what a one bedroom costs". Yes, obviously lots of types, but this is median, not average. The size nets itself out... because size was a factor in previous periods as well.

and yet again i must point out that those who have owned their apt, bought new, mint in 2003, who wish to sell now no longer have a new, mint apt to sell now--they have an apt in need of work, at best, if not in need of a serious upgrade/renovation---there're apples vs oranges and then there's mint vs in need of substantial work--oh shit, and i forgot about the appx 10% transaction costs that gotta strapped onto this sale

>those who have owned their apt, bought new, mint in 2003, who wish to sell now no longer have a new, mint apt to sell now--they have an apt in need of work, at best, if not in need of a serious upgrade/renovation

Your point being that when someone compares today's prices to 2003 prices, that they have to account for depreciation from the 2003 finishes, and so, if the nominal price of the apartment today is the same as it was when purchased in 2003, the real price to the owner is higher.

Interesting, well thought out point of view and position that no one else has yet shared ... thanks.

hberg, including basic upkeep in price is hard calculation as you have gotten use of the property. Ideally your buy vs rent calculation include upkeep of the property not just mortgage and coop maintenance. Without including upkeep, it is buy vs rent calcs calculation look much more favorable to buying.

mercer: do you care about who you are dealing with here?

"300_mercer, based on those numbers it would suggest that we are ~13% below peak. Not really a tank."
It is down more than 20% if you compare the inflation adjusted prices in the table above.
Mar-08 2164.09 1716.958

Oh hey Mercer. I just googled Mercer County, and there's one in New Jersey but none in New York. I guess you are referencing Mercer Street, in Manhattan, which makes sense. Good street. It's good to be in Manhattan, right, not 2.5 hours away in Columbia County?

>hberg, including basic upkeep in price is hard calculation as you have gotten use of the property. Ideally your buy vs rent calculation include upkeep of the property not just mortgage and coop maintenance. Without including upkeep, it is buy vs rent calcs calculation look much more favorable to buying.

I get that of course.

And you've also pointed out on the other side that there's often a difference between the finishes in an owned apartment vs. a rental apartment.

Either way, Wbuttocks is right in pointing out that if an apartment sells today for the same price as it sold in the past, the owner has still sold at an effective gain if you have to account for the depreciation of the finishes, etc. of the apartment.

And I think we all realize that in Columbia County, they aren't much worried about the condition of the outhouse ... if there's a hole in the ground, it's all good.

mercer: you've made a friend. good luck with it.

columbiacounty, when was the last time you made a friend?

a human friend. w67thstreet doesn't count.

you guys crack me up with your bickering.

> and yet again i must point out that those who have owned their apt, bought new, mint in 2003, who wish to sell now no longer have a new, mint apt to sell now--they have an apt in need of work, at best, if not in need of a serious upgrade/renovation---there're apples vs oranges and then there's mint vs in need of substantial work--oh shit, and i forgot about the appx 10% transaction costs that gotta strapped onto this sale

totally agree: 10% transaction costs + renovation cost to compete with new units (what would that be? 5%-10%?) or accepting the price hit for needing work (usually 10%-15% discount). although i have to say, the might not be a need to renovate a place htat was new in 2003, for sure one that was new in 1993 though.

"and yet again i must point out that those who have owned their apt, bought new, mint in 2003, who wish to sell now no longer have a new, mint apt to sell now--they have an apt in need of work, at best, if not in need of a serious upgrade/renovation---there're apples vs oranges and then there's mint vs in need of substantial work--oh shit, and i forgot about the appx 10% transaction costs that gotta strapped onto this sale "

Excellent point, wb... I had not thought of that.

OK, here we go with the calculations in real $$ (CPI from the gov labor site noted above). I simply adjusted the quarterly data with the inflation factor (I did it yearly, not by quarter, which could move things a point or two)

Median price by apartment size, Q4 2011 vs. CPI-adjusted peak

1 bedrooms - 27.7% down vs. peak
2 bedrooms - 22.3% down
3 bedrooms - 29.6% down
4 bedrooms+ - 51% down
Overall Median - 20.8% down

wow, nothing on this? I spent a good half hour on the inflation-adjusted...

Is this what capitulation looks like?

thank you.

are you ok now?

seems reasonable if not a touch optimistic for all but the 4 bdrm class, which might not be so bad

I continue to count my blessings, having had the luck to sell my 4 bdrm condo in 8/07---phew---moron ex-wife wanted to keep it and rent it out for the "income"--hilarious

and of course your numbers are optimitic generally, given they ignore closing costs in and out--think mortgage recording tax among all the other goodies--and they ignore wear and tear and inevitable periodic update/renovation costs

own only when market is trending strong--clearly not happening now

>moron ex-wife wanted to keep it and rent it out for the "income"--hilarious

Your ex-wife sounds like a moron.

"and of course your numbers are optimitic generally, given they ignore closing costs in and out--think mortgage recording tax among all the other goodies--and they ignore wear and tear and inevitable periodic update/renovation costs"

well, of course... but I think folks have been thinking all along more about cost to "buy in" (remember "buy now or be priced out forever) vs. buying to flip...