NY Times - 1/3 of Manhattan marke buyers losing half or more buying power "overnight"

Don't forget that the bonuses will be paid in near worthless restricted stock, not cash, which won't vest for years to try to retain employees. There is no more Wall Street money.

"The problems facing buyers from Wall Street won’t necessarily cause Manhattan apartment prices to slide drastically, said Diane M. Ramirez, the president of Halstead Property"

LMAO. Let me find the quote from D.M.R. where she said that Wall Street was propping up the Manhattan real estate market! So it props it up, but doesn't plop it down?

LMAO.

I know, I know... the hypocrisy is nothing short of amazing.

For YEARS, it was "Wall Street will protect" the market. Then Wall Street goes through the biggest ass-whopping its EVER had - including firms who never had losses EVER now having them, some giving back YEARS of profits, some flopping completely - and suddenly Wall Street has no effect on the market.

Oh yeah, except that it represents 33% of NYC income (source - Crain's, reporting on Mayor's Office Numbers) and at least 25-30% of apartment buyers (Halstead).

But, hey, what do FACTS matter to a broker shill.

Lehman is next. The Fed is going to rein in leverage. Unlike commercial banks, they have no base of cheap deposits to fund their operations. They need to borrow the money.

With new regulations since they've had to tap into the discount window and the Fed needs to manage its risk, the independent investment bank model is falling apart. Watch Merrill merge with BofA, Morgan Stanley with Wells Fargo.

You heard it here first.

This will have no affect whatsoever on Manhattan real estate prices. The rich foreigners are going to drive the prices up and you will all be priced out forever!!!

(ok, I think it's time I stopped drinking the David Lereah Kool Aid)

Boy it was hard to find a contradictory comment by Diane. Right in the NY Times itself!

http://www.nytimes.com/2008/01/13/realestate/13cov.html?pagewanted=all

From January 13, 2008:

Diane M. Ramirez, president of Halstead Property, is less concerned about a recession because the inventory of property on the market is currently low. She said that in the recession of the late ’80s, Manhattan dropped sharply because the city had an oversupply of apartments. “We had a deeper, longer recession than most cities,” she said. “We lost 20 to 50 percent value.”

[...]

History shows that a great deal of the bonus money is used to buy real estate. Financial workers are typically the first buyers to show up with the cash in the spring buying market, and this helps shape demand for apartments.

“That energy of the bonus money really does get the spring market percolating,” Ms. Ramirez said. “The bonus tends to be the starting gate for them.”

The funniest part is, IT'S THE EXACT SAME REPORTER!

Did I mention that there was no "spring market"?

I love Ramirez. When she was on CNBC a few weeks ago, there was a box directly below her that contradicted nearly everything she said.

The NY Times real estate section is garbage and is just there to attract RE ads. And so is the NY Post RE section. I have the latest Post RE section right in front of me and 99% of it is ads. Hardly any useful articles. The ones with the best articles about the local housing market are Bloomberg and the WSJ.

Why are we surprised that the broker shills are, well... shilling.

BTW, has anyone noticed that the term "bitter renter" hasn't been used AT ALL this week on the board?
Guess we know who is bitter now...

Personally I enjoy pissing my rent out the window, 23 stories down onto the idiots who thought real estate would rise in value forever and ever and ever.

Because at $4,500 a month it costs half of what buying would cost, and as property prices fall 50%, $4,500 seems mighty cheap compared to $450,000.

One thousand months of rent I saved by not buying. Damn!

I know, I love it! I'm paying half the interest costs of the ass in the apartment below me.....

Okay, a hundred months.

I'm so disappointed.

"BTW, has anyone noticed that the term "bitter renter" hasn't been used AT ALL this week on the board?"

In case you did not get the memo from Sen. Gramm, the term "bitter renter" is out and "nation of whiners" is in.

But "bitter" goes with "bubble buyers" better.....

I'm sticking with that. BBBs it is...

Wait! Here on Fire Island I just heard a loud crash. I think it was the Long Island City Real Estate Market.

Thanks for the link- although anecdotal, quite scary indeed. Especially the part where the qualified couple who secured a loan from the bank with the multi-million $ parent guarantor who put 20% down + maintenance.

The board didn't even bother to meet with them. Wasn't worth the face-time.

Actually Steve, I think the noise you heard was John McCain's Straight Talk Express running over the American Middle Class on the LIE.

Possible alpine, but i tend to mute both him and obama. i like hillary, think i'll just sit this one out.

The same way Wall St. helped prices skyrocket, they will contribute to prices declining.

A bank failed over the weekend and some people will actually lose their money. It's said that some 1 Billions exceeded the FDIC threshold of $100,000. This is insane. I still don't 99.9% of the nation has any idea how bad things are going to get.

But where are you gong to put your money? Just split it into $100,000 increments and parcel it out to various banks? Is that really a good plan? Is that what people are doing now to protect themselves?

"Lehman is next. The Fed is going to rein in leverage. Unlike commercial banks, they have no base of cheap deposits to fund their operations. They need to borrow the money.

With new regulations since they've had to tap into the discount window and the Fed needs to manage its risk, the independent investment bank model is falling apart. Watch Merrill merge with BofA, Morgan Stanley with Wells Fargo"

I predicted Lehman's fall a month ago (and I have been shorting since then). Next sector to watch is the REITs. They are not looking that great either.

Eddie, you are a bitter renter. Feel better.

"bitter renter"

I'm glad we finally heard it, and who better than from ccdevi?!

perhaps petrfitz or youlandlord.

but i'll take ccedevi. =D

ccdevi: "Eddie, you are a bitter renter. Feel better."

Finally a differing view - well sort of. This thread was getting too one-sided.

baabamaal, so true, it was getting too one sided. it was too real.

we needed that burst of baseless name calling.

My dick's bigger than yours.

There. Satisfied?

Your all a bunch of whining bitter renters who are in a perceived mental recession.

How wss that?

You're right.

Did you know people who own co-ops are renters, too?

Nasty bunch of people renters are.

lol, god you guys are so stupid its unreal.

yes mafia too real, filled with priceless observations such as "I predicted lehman's demise a month ago"

Where in the article does it state that 1/3 of all buyers lost half or more of their buying power? Is it located in one of those paragraphs that also states the Jim Rogers says Manhattan RE market to drop 50% or perhaps is it in another paragraph that also states rents in the West Village have dropped 55%.

How do you think that the housing market will affect rents? I believe that we (renters) will have much more negotiation power.
Howerver, there are so much noise in the information that even straight forward rules of supply and demand seem not to apply to this market. I've heard that foreign investors will not let the market go down; however except for the super exclusive condos (15 Central park West, Plaza, etc.), $1,000,000 is a lot of money for anyone in USD, Euros or Pounds. If I were one of those investors I would think twice before investing my money in something completely overvalued.

Citi will right behind Lehman. If Freddie and Fannie go the rest is history. I have said this before. You have to pay attention to the statements made by the gov't and CEO's. Read between the lines. It was a dead giveaway when the Fed decided that $5 gas and $5 milk ( AKA inflation) wasn't a priority. They decided that increasing rates would further hurt the liquidity problem. In that statement and inaction they showed their hand. It didn't make sense. Every CEO said everything was great an they had no reason to raise money. Even the gov't said the Banks were OK and stated that the window would remain open.

Despite all the re-assuring they still didn't raise rates to address the inflation problem. Now everyone else knows what I did. The problem is nothing like anyone has ever seen. Even on Friday members of Congress,( Dodds ) were still telling people that Fannie and Freddie were fine. There is ZERO credibility left in gov't and wall street.

"lol, god you guys are so stupid its unreal."

good one ccdevi, good one. LOL.

spunkster, read the article. It says precisely that 1/3 of buyers lost half or more of their borrowing power.

Sorry.

wall st is a mess and there is little to no cofidence in any type of turn around for the balance of thsi year. additonally wall st net worths have contracted easily by 30% (with the consequent 60+% decline in brokerage equities) for sellside employees. on balance most buyside shops have racked up small to little PL for the yr. the larger issue now is the lending balance sheets are being delevred and will as most pendelums swings will probably contact fr more than prob need be. RE is by construct a leverage tranaction. and once leverage is reduced prices mechanically falls. How much? i have no idea, but its obvious to any active price watcher there have been aggresive price reductions in the past 2 months.the trend is in .. and let the trend be your friend .. of course property in manhtattan will transact, butthe setup is lower. embrace the horror your apt will not go up forever its ok ...

can't say i didn't tell you so!

U.S moves to rescue Fannie and Fannie

WASHINGTON (Reuters) - The U.S. Treasury Department and Federal Reserve on Sunday announced sweeping measures to lend money and buy stocks if necessary in embattled mortgage lenders Fannie Mae and Freddie Mac.

http://www.reuters.com/article/newsOne/idUSN1332789320080713

First Bear, next IndyMac and now Freddie and Fannie.

65 billion is light guesstimate of fannie and freddie next 3 year losses.

http://www.marketwatch.com/news/story/treasury-fed-move-rescue-fannie/story.aspx?guid=%7BAF7D0E9C%2D115C%2D4B41%2D9AF6%2D97BD668BC455%7D

Watch USD imploding tomorrow.

The financial system is in free fall and we are all doomed. Next stop Lehman Brothers!

> spunkster, read the article. It says precisely that 1/3 of buyers
> lost half or more of their borrowing power.

Spunky hasn't based anything off an honest fact in 10 years... so why do you think he'd be able to recognize one when he saw one?

Okay genius can you please give me the exact quote (exact quote as in exact) from this article that states "1/3 of Manhattan market buyers losing half or more buying power overnight"

I missed the overnight quote as well.

"Overnight" --where's that one again

It doesn't say it spunky. This is classic Eddie Wilson. Make something up, state it as fact, then when you call him on it, he says that you don't have facts and are just calling him names. I wonder if this guy even graduated high school.

Spunky, are you really playing this dumb again? You missed the quote? Really? Thats funny.... ITS THE OPENING LINE.

"ALMOST overnight, investment bankers and others on Wall Street have gone from being Manhattan’s most aggressive apartment buyers to real estate pariahs. "

As for the losing the half of buying power.. check the paragraph that starts with "In the past, Wall Street workers would count most or all of their year-end bonuses to qualify for mortgages". Not to mention, its pretty well laid out in the FIRST POST ON THIS THREAD.

As for it being a third of the market, check the Halstead estimate in the 4th paragraph. And thats an understatement, NYC budget office has 35% of NYC income coming from Wall Street.

Actually, I don't know why I even did that. Spunky clearly just can't read.

My question about the co-op boards is this: if you turn down qualified buyers simply because they work on Wall Street, who is going to prop up prices? I am not sure who the boards think are going to come in and buy these multi-million dollar apartments, if not Wall Streeters.

So basically what you are stating is that 100% I repeat 100% of all Investment bankers and others that work on Wall Street have cut their buying power by 50%. I use the 100% because as you stated Wall Street employees represent 1/3 of all the buyers. I missed the part where it states overnight 100% of Wall Street employees lost 50% (or one half) of their buying power.

Agreed it makes little sense long term, but short term if might cover up some problems.

Short term, they'd probably rather just let the apartment sit than 1) sell for a price that will demonstrate a decline in prices in the building or 2) worry that a defaulting buyer will ruin the financials.

If they screw the current owner, that guy will still likely be paying his fees, and the building does fine.

When the bankers IN the building start having problems, then they're be double screwed. And if multiple buildings hurt the overall market by pulling this stuff, then it will come back to them in the end.

"Workers in financial services-related businesses make up roughly 25 to 30 percent of Manhattan buyers, according to estimates by Halstead Property. Although some lenders and building boards are accepting these buyers after tightening requirements, others are becoming far more interested in buyers outside the financial industry."

So Eddie you are rationalizing that 100% of the above Wall Street workers have cut there buying power by 50% Is that how you are interpreting what the paragraph above is stating.

Oh yes and this had occurred overnight. Sorry about that.

"Actually, I don't know why I even did that. Spunky clearly just can't read"

I can read you just can't understand.

That is understanding what you are reading.

"So Eddie you are rationalizing that 100% of the above Wall Street workers have cut there buying power by 50% Is that how you are interpreting what the paragraph above is stating."

OK, spunky, you are CLEARLY playing dumb now. Its in the paragraph in the SAME POST you didn't real, in the article you didn't read. I'm not responding to your stupidity anymore. If you can't read, its not my fault.

Oh yeah, and lookie lookie.. the same LI calling the kettle black.

"It doesn't say it spunky. This is classic Eddie Wilson. Make something up, state it as fact, then when you call him on it, he says that you don't have facts and are just calling him names. I wonder if this guy even graduated high school."

Yet another post which absolutely no commentary in it. LIC's last 15 posts have been the "no, YOU are stoopid" 3rd grader variety replies.

"OK, spunky, you are CLEARLY playing dumb now. Its in the paragraph in the SAME POST you didn't real, in the article you didn't read"

Ahhh thanks I think that certainly clears that up

LIC, can't you come up with ANYTHING else but your factless, brainless drivel?

other post highlights:
"Is Eddie Wilson trying to say something? All I'm seeing is a bunch of babble and simple-minded nonsense."

"I think this board has officially become "The Delusional Paranoid Pessimist Blog." 80sMan had some administrative back-office job 20 years ago and he thinks that makes him an inside expert on all things Wall Street."

Again, no facts, no insight, no brain, no information, just "U ARE STOOPID AND LONG ISLAND CITY WILL GO UP FORVER"

Eddie ever think of hosting the World Wide Wrestling Federation.

Why, I'm making too much money in real estate....;-)

I'd say you guys should become brokers... but, lord knows THAT industry is screwed...

> Ahhh thanks I think that certainly clears that up

Well, if you can't read, nothing will...

You could also be a referee so you can look the other way while one wrestler slams a chair over his head.

coming from the guy who can read an article and miss the headline, facts, and, uh point of the story. ROTFL.
Kettle back, spunky... kettle black.

EddieWilson, LICComment doesn't read very well. I never said I worked in a back office position and I never said I worked on Wall Street in the 80's.

80sMan, don't worry, there seems to be people here who think that anyone who posts anything about accounting, balance sheets, performance etc is in a back office position. Some would even say, back office "clerk" in an attempt to rub you and the profession in the face.

What I wonder is... what does whether or not we work in a back office position have anything to do with anything? Except, perhaps to make them feel better that what you do for a living is something they consider 'lowly'.

Interesting behavior indeed. But nowhere near as interesting as Petrfitz's behavior.

I think LIC and spunky are on this thread (and, hell, pretty much all the other ones) to say ANYTHING that gets the discussion off the actual point at hand... that the last leg that was holding up this market is now gone.

Eddie, I'm still waiting to see one post from you that has anything substantial in it. All you do is make insulting comments about people who own their home and unverifiable claims that their home values have crashed, which is ironic since the people you criticize are probably in far better financial situations than you'll ever be. You read a statement in a post that sales are down in Brooklyn so you write 50 times that "sales down 44%! sales down 44! sales down 44!" That is the extent of your substantive commentary.
You are jealous of those who have bought their homes and are enjoying the benefits of owning in their life, while you are still dependent on the whims of landlords and the rental market. Go get your high school diploma and then come back to the board when you can comment intelligently.

Eddie if you didn't distort the facts maybe you would have some credibility.

Going back to the original topic of this thread, I'm appalled, and hope that the accounts reported in the story are isolated. Having served on a coop board myself, I can't say that there's wisdom in being even more restrictive than usual. Most, if not all, subprime issues, Alt-A (no income), interest-only loans were granted outside of New York. So, we're insulated from those risks. If a person has demonstrated that they're employed, in Finance or otherwise, and has assets (for the everyday New Yorker that would mean the equivalent of the mortgage in liquid assets), this should indicate not only the ability to generate income but the saavy to maintain those earnings (after all, a high base only settles the debt-to-income ratio), why impede the sales process? It's one thing to have basic economic supply and demand drive prices up - or down as some would hope - but to have the same fear that permeates our stocks markets today (though today's futures indicate otherwise) to dictate the board evaluation and, as a result, cause prices to decrease as a result, is contrary to the fiscal responsibility that a board member is supposed to uphold. Overreacting and driving away solid investors is not why we have coop boards.

My favourite part of this is that the "bears" spent their Sunday romping around on anon. boards celebrating bad market news. Maybe the "bulls" were so quiet because we were enjoying our families and money in our vacation homes. But, glad you guys had a nice time. A bit sad. But not entirely suprising.

> You read a statement in a post that sales are down in Brooklyn so you write 50 times that "sales
> down 44%! sales down 44! sales down 44!"

1) It wasn't in a post, it was in the REBNY market report

2) Learning time for you... its called a *statistic*. You should try one sometime.
That is the extent of your substantive commentary.

> which is ironic since the people you criticize are probably in far better
> financial situations than you'll ever be.
> You are jealous of those who have bought their homes and are enjoying
> the benefits of owning in their life, while you are still dependent
> on the whims of landlords and the rental market. Go get your high
> school diploma and then come back to the board when you can comment intelligently.

Dude, you live in LONG ISLAND CITY. You couldn't afford Brooklyn or Manhattan. We know, we got it. And now you're scared sh*tless because you were overextended, too. Scream all you want, but its fairly clear you 'aint someone who should be bragging.

I've clearly got a LOT more money (and education) than you.

> My favourite part of this is that the "bears" spent their Sunday romping
> around on anon. boards celebrating bad market news. Maybe the "bulls"
> were so quiet because we were enjoying our families and money in our
> vacation homes. But, glad you guys had a nice time. A bit sad. But not
> entirely suprising.

When the bulls have COMPLETELY given up on statistics, facts, or logic, and are just resorted to jumping on all the negative news posts with "u are stoopid" and "my house is bigger" and "but I'm living well!", you KNOW the market is f*ed.

I can't say I'm not enjoying this...

Eddie, what are you enjoying? That a small percentage of buyers might find themselves with negative equity? Again, most owners have owned for years. We're fine. If we lack facts is probably because we simply don't need to track the market as insanely close as you seem to. It doesn't matter inthe short term what the market is doing. If I wanted to I could sit here and jerk off to the fact that some of my neighbours have lost money but that seems slightly sad and really has no purpose. Aside from the shitty karma you're bringing on yourself.

> Going back to the original topic of this thread,

Thank you.

> Having served on a coop board myself, I can't say that there's
> wisdom in being even more restrictive than usual.

Agreed.

> Most, if not all, subprime issues, Alt-A (no income), interest-only
> loans were granted outside of New York. So, we're insulated from those risks.

But not the risks of a good credit formely high income banker losing his job, or at least seeing a major loss in bonus.

> If a person has demonstrated that they're employed, in Finance or otherwise, and has assets (for
> the everyday New Yorker that would mean the equivalent of the mortgage in liquid assets), this
> should indicate not only the ability to generate income but the saavy to maintain those earnings

I agree with the first part... if they have the money in liquid assets, sure, but I don't know how that indicates the ability to generate income in the future. Thats the big point. You made $5 mil a year in mortgage backed securities the last few.... you really think you're keeping the same $$$?

Even if you keep your job, the article points out at a compensation tracking firm noting that bonuses will be down 30-40%. And that isn't a guess, as money is set aside for bonuses during the year, so its a calculation that can be made.

> Overreacting and driving away solid investors is not why we have coop boards.

Agree with that... but, fear drives a lot of things. And, there was a time in NYC when high end co-ops were being sold for $1 because no one could afford the maintenance. Not saying we're getting anywhere near there, but if a co-op isn't 100% sure you're going to be able to afford ongoing living in the building, its a LOT easier to keep you out then to kick you out.

And, as long as the co-op board members aren't trying to sell THEIR apartments, who cares if they screw some other owners to keep the building in "good shape". Thats what this really boils down to.

Why is is that the folks who swear they don't care about the ins and out of the market, they are insulated, they are above this all, they don't care... are the ones who post every three minutes on every post?

And, as long as the co-op board members aren't trying to sell THEIR apartments, who cares if they screw some other owners to keep the building in "good shape". Thats what this really boils down to.

Whats the problem with that? The board is elected and acts for the good of the building, not an individual. You know this when you buy into a coop.

If a board won't let other owners sell their apartments simply to keep average price high when its time to sell *their* aparments, that is *not* good for the building...

I didnt say it was, I merely said when you buy intoa coop you know you own shares and that you wont always get your way. you elect your board. if you elect a nasty board they do such things. if you don't, they can't. the essential thing is to go to the meetings and if you see a trend like the one you describe, call the coop lawyer and threaten them. then vote them of fint he next election. not a huge crisis.

eddie, are you always such a drama queen?

>...there was a time in NYC when high end co-ops were being sold for $1 because no one could afford the maintenance

I think that people have both mental and fiscal thresholds when it comes to what is affordable. We've seen people with $200 in their bank account splurge on thousand dollar vacations and people who have $2MM in stocks but splurge on a weekend in NJ. I'm not advocating either but my point is that because such a parity can exist between the two thresholds, it's good to have boards keep these in check during the evaluation. However, I think that the entire fiscal picture (income base, income bonus, retirement funds, applicant age since we can't expect a 30 year old to have the same assets as a 60 year old, and asset buildup) should be taken into account.

>risks of a good credit formely high income banker losing his job, or at least seeing a major loss in bonus.

Of course, the job situation should be taken into account but I've never known of boards to fully account for bonus income to begin with, even during better economic times. It's usually discounted, just like retirement funds, if taken into account at all. Personally, the fact that the person even has a retirement nest egg is telling in my opinion that the person financially plans and this shows responsibility - so I take it into account towards the person's character and what type a shareholder he/she'd be, even if the board approval process precluded me from doing so.

>And, as long as the co-op board members aren't trying to sell THEIR apartments, who cares if they screw some other owners to keep the building in "good shape".

Glad to hear that you agree but 'good shape' isn't driving shareholder prices down because a board's irrationally turning away financially-healthy people.

If this careless behavior continues and/or is prevalent, then this is just self-defeating and we will see buildings self-destruct their market values...so to all of the intelligent, informed coop board members, STOP the madness.

In times of fear, the irrational does in fact come in.

> Of course, the job situation should be taken into account but I've never known of boards to fully
> account for bonus income to begin with, even during better economic times.

But if its a % to a lesser %, you're still talking major impact. Say they were taking 50%, and now its 25%. Plus, co-ops aren't selling right now (near 50% decline) and maybe this is the reason. But condos have been propping the market in the last few months (to where they went from 25% of sales to over 50% of sales), so this kind of thing is still bad news overall:

"In the past, Wall Street workers would count most or all of their year-end bonuses to qualify for mortgages, often borrowing amounts that covered 90 percent or even 100 percent of the purchase price of high-end condos."

In times of fear, the irrational does in fact come in.

what the hell does this even mean?
is this something about your irrational fear?

it was a direct response to this..

"If this careless behavior continues and/or is prevalent, then this is just self-defeating and we will see buildings self-destruct their market values..."

Fear drives some pretty stupid decisions.

Fear drives some pretty stupid decisions.

then why do you spend most of your posting time on fear mongering? is it useful? helpful? what do you want to see happen? people who bought last year to be flogged and humiliated? the market to crash so badly we turn into japan or argentina? what is a useful or satisfying otucome for you? to what end are you relentlessly posting?

>Fear drives some prett stupid decisions...

Not to mention, in the wise words of our little green friend, Yoda:

Fear is the path to the Dark Side
Fear leads to Anger
Anger leads to Hate
Hate leads to Suffering

Again:

If [the fear-driven coop board DISapprovals of qualified, financially-healthy potential shareholders continues] and/or is prevalent, then this is just self-defeating and we will see buildings self-destruct their market values...so to all of the intelligent, informed coop board members, STOP the madness.

Is this real estate, or Star Wars?

Said LIC:
"You read a statement in a post that sales are down in Brooklyn so you write 50 times that "sales down 44%! sales down 44! sales down 44!" That is the extent of your substantive commentary. "

No, lets correct this. I found the source (Crain's), quoted it, and linked to it. The post you speak of was one I *wrote*, not one I just happened to read.

Thats called a statistic.

Now, you might happen to really really not like it, and really really not like what it means, but all your 3rd grade banter stuff isn't going to make it any less true.

Here it is again, for the folks who *do* care about facts, logic, etc...

>> Brooklyn's home sales and prices cooling

The number of apartment and house sales declined by 44% and median prices sagged by 2% in the second quarter as economic worries plague would-be buyers.

http://www.crainsnewyork.com/apps/pbcs.dll/article?AID=/20080710/FREE/310776106/1059/newsletter11

Brooklyn's home sales and prices cooling
The number of apartment and house sales declined by 44% and median prices sagged by 2% in the second quarter as economic worries plague would-be buyers.

July 09. 2008 7:51PM Elisabeth Butler Cordova

Buck Ennis The Brooklyn real estate market is showing signs of wear as banks become skittish about lending and consumers worry about the economy. Home sales in Brooklyn took a nose dive during the second quarter, and median prices dipped, according to a report released Thursday by brokerage firm Prudential Douglas Elliman.

Across the borough, the number of sales fell to 2,031, down 43.6% compared to the year-earlier quarter. Median sales prices fell to $525,000, 1.9% lower than the comparable period of 2007.

The median prices for new condominiums grew 19.5% to an average sales price of $580,402. Among the most expensive apartment deals, the average sales price was $1.4 million, down slightly from $1.5 million a year ago.

“The new product that is entering the market is skewed toward luxury apartments,” said Jonathan Miller, chief executive of Miller Samuel Inc., the real estate appraisal firm that prepared the report. More than half of Brooklyn’s newly built condominiums are labeled as luxury homes, which caters to Manhattanites moving to Brooklyn and Brooklynites trading up, he added.

With a per-square-foot sales average of $575, Brooklyn condos are still a relative bargain compared to Manhattan’s, which have an average of $1,442 a foot.

Among co-op apartments in the second quarter, the median sales price rose just 1.3% to $255,000. The number of transactions slowed by 53% to just 314.

The market will likely slow further as banks, still smarting from the subprime debacle, are demanding bigger down payments and frisking every customer for potential finance flaws, said Dottie Herman, CEO of Prudential.

“The banks are so nervous, they’re cherry-picking,” Ms. Herman said. “They want 20% to 25% down instead of 10%, and that’s going to make a big difference in prices.”

said eah (replying to "Fear drives some pretty stupid decisions")
"then why do you spend most of your posting time on fear mongering? is it useful? helpful? what do you want to see happen? people who bought last year to be flogged and humiliated? the market to crash so badly we turn into japan or argentina? what is a useful or satisfying otucome for you? to what end are you relentlessly posting? "

Excellent question. I'm a "pull the band-aid off quick" type. I'd like the market correction to speed up, and get to a bottom as close as possible. Its the lingering "how bad is it gonna be" stuff that usually creates more problems down the line. Banks should clean up their balance sheets, developers should take their lumps, and lets get this sorted out with the chips falling where they may, so we can move on to the next bubble...

so we can move on to the next bubble...

and, finally, we agree.
to the next bubble.

am off for an early lunch.