If this is a buyer's market...

Why not bid what you think is fair in your opinion? Curious what that number is.

I just read an article that said it takes 1-2 years for sellers to get religion on the market value of their home. Also read another article that talked about how low bids that would not have worked a few years ago are now working today. It's very interesting to follow the psychology of this market as it slowly slips down. Where it stops, I certainly don't know - but might get rich if I did.

Black Monday was October 19, 1987. The real estate market didn't bottom out till 1992, prices didn't even come down much till 1989. Real Estate is a very illiquid and the market momentum is strong.

Over the past decade buyers have been "trained" that properties sell at or above ask. We are currently seeing a lot of properties sell below ask, and in the case of some new developments significantly below ask. I absolutely agree that in the current market buyers should not be bashful about submitting offers - just understand that if a seller's broker gets "offended" by a low offer it could just as easily mean they are dealing with an obstinate, unrealistic seller as the offer was ridiculously low. In fact, in the current market your best bet may be to make offers on many properties to see if you can find one who is willing to sell at a price you find reasonable.
That said, don't be one of those buyers who reads the market is down X% and that on average sellers are negotiable by Y% and then goes out and looks at 100 apartments, finds the one which is already priced correctly at an X% reduction but still expects to negotiate another Y% off. Also don't be one of those buyers who thinks the market is going down but wants to buy today at the price they think the market will be going down to in the future. You only get to buy in today's market - if you think the market is going down, then wait.

While personally I think the market is going to end up down 35% to 50% off of peak prices, no one knows. I do find it interesting that a bunch of people who have been saying for the past few years "the market isn't down!" recently flipped directly to "thank God we are at the end of this long down market."

Just as aspirational asking prices anticipated rising property values, today we seem to be starting to see "aspirational" bid prices that anticipate lower prices in the future.

Some studies show that asking prices that are below market value encourage more bidders and result in bidding wars that achieve higher prices for the seller. Other studies show no difference regardless of where the asking price is set.

My guess is that seller motivation has the biggest impact which is something difficult to figure out but not impossible.

I do think the apartment the OP chose to illustrate their point is a bit of an odd pick. There is another unit in the building from the holder of unsold shares which is a full room larger and $400k less, and while it's unrenovated that's certainly no high end reno in the property linked to. They have been a partner of mine in a number of deals in the past and I have always found them to be both rational and reasonable, and I think they aren't changing that with the current listing. So if you want to go looking for sellers who aren't ignoring current market conditions, I don't think you even have to go outside this building. But you can't look around, find the exact apartment you want and then expect *that* seller to hit *your* number.

30, That is a great point. Find something reasonably prices - there are indeed priced apartments - and bid 5% below to see whether you can get it.

The sellers might also be dealing with a board that is resistant to a lower price point. You may make an offer which the seller accepts then the board rejects, wasting time.

I don't think that unit's current price is too far off the mark as an opening offer. I wouldn't start much lower if I was interested in selling, sorry. They can always lower the price and its just fresh on the market, its not lingering yet. You never know. Its a good building in a good location and a corner unit. The reno is very decent (it was a gutted sponsor sale from 2012) but granted I doubt they put in a million dollars of value, so I'm sure the seller would be OK on coming down. They'll either get a sale, go down, or take it off the market if they don't get the price they want. Its a buyers market I agree, but sellers all have their own situations and can ask what they want...and sometimes I feel like posts like this are some weird attempt to shame specific prices down. The market will sort it all out at the end. In any event I think coop resales in aggregate also have much more wherewithal to find a price that works for the seller because they are less likely to need to unload (new development) or perhaps less than secure financial positions (condo).

@sippelmc, that is not the case with my post. The floor plan of this unit doesn't suit me, so I wouldn't bid in any case. Even if it did, though, the fact that they are starting out at an (IMO) unreasonably high asking price would turn me off from making an offer because there's no chance the sellers and I would have a meeting of the minds on this one. We'd be so far off on what we each thought the unit was worth that it would be a waste of effort for both parties but especially for me. I'd bid within a range of -10% at the absolute max and I'm something like -18% on this one in terms of what I think it's worth vs. what they're asking for it.

@300_mercer Personally, I think $1.65m is ok for this unit using 10F in the same building as a comp. That one was listed at $1.55m and recently went into contract, although it's not clear to me what the final price is. That unit appears larger with a dedicated dining area and is already set up as a 2 bed, plus it happens to be on the 75th side of the building, which to me is superior to the 76th side (I've been in the building and noticed that the 75th side lobby is much bigger and nicer while the 76th side is tiny and has only 1 elevator bank vs. 2 on the other side, IIRC...plus it's right around the corner from the funeral home). Both seem to be bright, high floor with nice views. However, 10F's reno appears older than 12J's, and there is the 2-floor difference between the two. I'm not a RE broker, though, so tough for me to say. That's just the price at which I wouldn't be inclined to think someone overpaid for it.

sipplemc, It is no more than 1200 sq ft. Mid-end reno. I think $1600+ per sq ft is a little high. I can understand if this were to be 1500 per sq ft. So $1.8mm is probably the current market in my opinion.

Ya that's fair, I'm not saying that it is worth $2mm, but its fresh on the market and like I said its not that far off of market (1.8?) and so why shouldn't the seller reach a bit? Its not an example of an unrealistic seller as OP states. I guess I feel like the reno is more on a very good mid end. I think maybe its personal taste but I'm not sure how else you can finish a pre-war better without starting to look ostentatious. I was pretty impressed they pulled a full second bathroom out of an only 1 bathroom original floorplan.

Sipple, I think it is certainly mid-end for $1500 per sq ft. Cheap stove and fridge rather than Viking or Subzero, Wolf etc. Cheap subway tiles in the second bath. A lack of nice vanity. No marble on the vanity wall. I can go on. Countertops nice but noting special. Cheap back splash.

Sipple, I think it is certainly mid-end for $1500 per sq ft. Cheap stove and fridge rather than Viking or Subzero, Wolf etc. Cheap subway tiles in the second bath. A lack of nice vanity. No marble on the vanity wall. I can go on. Countertops nice but noting special. Cheap back splash. See example of high-end at $1300 per sq ft but it is not uws.

https://streeteasy.com/building/international-plaza/7c?context%5Bcontroller%5D=%23%3CBuildingController%3A0x000056330083e6c0%3E&context%5Bcurrent_user%5D=1004028&hide_if_empty=true&section=sales

That's interesting as I don't see the tudor city unit as high end. It has brand name appliances and fixtures but the apt itself doesn't have a good build, has no moldings, generic looking floor, ceiling looks dated but at least the popcorn was removed. I'm not dismissive of appliances/fixtures...I have a Porcelenosa bathroom and Wolf/Miele kitchen myself....but thats just a small piece. To me they did a good job in the UWS apt, the floors show really well and the millwork, from the pics, looks well done. The subway tile bath is the master bath and probably original and I'm guessing from the sponsor sale pics in 2012 they purposefully kept the prewar detail -- I think that's cool and a good choice. Same with the new bathroom isn't wall to wall marble but that'd be awkward in a prewar in my mind. Anyhow really I think everyone has diff tastes but its fun to talk about.

Moldings are indeed very nice and well suited to a pre-war (crown moldings will look strange for post war floor to ceiling windows) but the dark brown/gray floor is not my cup of tea. Master bath as you say does not seem to be renovated. So take down another 50k. $1.75 will be fair in this market. Similar apartment sat on the market for while and traded for below $1.6mm.

https://streeteasy.com/building/161-west-75-street-new_york/10f?context%5Bcontroller%5D=%23%3CBuildingController%3A0x000056114aabb6c8%3E&context%5Bcurrent_user%5D=1004028&hide_if_empty=true&section=sales

https://streeteasy.com/building/161-west-75-street-new_york/10f?context%5Bcontroller%5D=%23%3CBuildingController%3A0x000056114aabb6c8%3E&context%5Bcurrent_user%5D=1004028&hide_if_empty=true&section=sales

I really doubt the subway tiled bath is original. Firstly because the subway tiles would have been absolutely flat as opposed to slightly pillowed near the edges and close to zero grout lines. Secondly because that's a new drop-in tub with a tiled surround. Thirdly that's a new shower body with a pressure balanced valve and no evidence in the tile that it's been retrofitted. Fourthly that's a marble tile floor.

The pics on the International Plaza listing seem to have disappeared?

Ya sorry, I was trying to say judging by the sponsor sale pics it was likely original (and unuseable), and they could have done anything, but decided to keep prewar detail (since no matter what they had to completely redo).

I just clicked and the pics show for me.

30, Good observation on the master bath being redone. How do you compare the price to 10f in the same building?

12G has a better renovation and view, but 10F has better layout, more space, in unit washer/dryer ( it has over 8.5% higher share count). Note that the broker for 12G doesn't list the assessment in place for the next 3 years.

So OP is right seller's getting the message especially when you have a recent sale in the same building. Throw in $150k for view and better reno (the second one is subjective). Still $1.7mm.

I'm not sure what you mean by "the seller is getting the message"?
If you add $150k for better renovation and view, what do you subtract for better layout and more space? What do you think is the square footage of each unit? At $1200 PSF in my mind that's plus around $250k for 10F.

If someone was going to give you one of those 2 units for free which one would you choose? I think I would take 10F.

Maybe the SF differential is $125k not $250k. But I really would like to know what you calculate it as, etc.

And while we're at it, let's add in 8H - which of the 3 would you pick at the same price? I think it's 8H for me (don't forget to add in that it's a sponsor unit for some incremental value).

I mean that “seller is not getting the message” about the current market pricing. All I can say that 12G is likely overpriced relative to others in the same building. Hard to say more without seeing in person.

For 8h, some one will spend $300 per sq ft, carry for 9-12 months and trouble. Call it 1400 sq ft. That looks like $600k expense.

I think that a savvy person could do as good a renovation to 8H as you see in 12G for $300k ... or less.
Take a look at the renovation of 3H - no major layout changes, no central air, no new floors (and by that I mean the vast majority of flooring wasn't changed), nice kitchen and baths but nothing "over the top" ... and it sold for over $2 million.

Also since it's a Candella building I think in general one of the worst things you can do is run around making big layout changes.

I am assuming $300k does not include carry of say $100k and $50-100k for trouble? I would definitely change the floors which would add 30k minimum to the $300k number you mentioned. Architect alone will charge at least $30k, if not $40k.

If you did something similar to what 3H did you're looking more like $15k architect and $40k carrying, $70k kitchen, $80k for bathrooms, $80k for everything else.

I think these are prices a semi-pro, who is at the site every other day to ensure the work is done properly, could get. Most architects will not touch it for less than 25k for an individual due to the coop and dob approval process.

I wonder why the sponsoror does not renovate and sell it. They can probably get the above prices if they appoint some one to manage the process.

They may if they don't get their number.

That makes sense and they can charge 100k for their trouble which is more or less a buyer would want for their trouble in addition to actual Reno and carry cost in a market with plenty of finished product.

Responding to the main point, I don't think the market is soft in all areas. We bought our co-op when the market was hot in 2014. The unit we bought sat on the market for a while and we bought it for less than asking (it is a 2 br/2 bath with a DR and an oddly small galley kitchen, which is why we think it turned some buyers off). In the last 6 months, two of the same units on lower floors (that are no nicer than ours) sold in a day for about 200k more than we paid in 2014.

Lz3, I fully agree with you. That is the point I have been trying to make. $1100-1600 per square ft livable to nicely renovated properties in good areas of Manhattan do not have much supply and are affordable. Not a whole lot of downside unlike $3000-5000 per sq ft condos which have already corrected 20 percent at least while still leaving enough profit for developers.

Agreed. Us "common folk" (the 1.0-2.0 million dollar apartment owners) are generally ok in this market. My building also has 1 BR's and 3 of them sold in less than a week for asking or a tad above asking price.

I'm curious what that building is because we are seeing plenty of softness in the $1 million to $2 million range.

30, are you seeing softness in the closing prices or the days on market? I have seen inventory and days go up in my building but closing prices have stayed pretty firm at the 2015-2016 levels or a little higher.

"I don't think the market is soft in all areas".

Sorry but when has the market ever worked like this except in transition? Wait 6 months.

I presume my building must be an anomaly (we did also recently pay off our co-op mortgage which lowered monthlies by about 15 percent, our financials are great and there is unlimited subletting so that probably helps a little bit). I prefer not to give out the building info because I want to remain largely anonymous.

ChasingWamus,
I'm seeing buildings where 1 BRs sold for +/- $1.1 million 2 years ago but are asking under $1 million right now. Take a look at London Terrace.

Needs full reno. 1200 sq ft in contract. Last price 1.49mm. Original ask never made sense. So gut reno at 1100 per sq ft plus in a low Ceilng post war building seems very healthy market to me.

https://streeteasy.com/building/360-east-72-street-new_york/a1001?context%5Bcontroller%5D=%23%3CBuildingController%3A0x0000555946ef2d48%3E&context%5Bcurrent_user%5D=1004028&hide_if_empty=true&section=sales

Is this a soft market sale? Not by any standard in a low ceilng post war with 3inch thick walls between the apartments.
https://streeteasy.com/sale/1324784

Another one. 1200 sq ft. Sold fast.
https://streeteasy.com/sale/1331730

There are people with stupid asks for apartments needing reno like this one and they complain about market conditions. This apartment was never more than $1mm ($1250 per sq ft) in its current condition.

https://streeteasy.com/building/greenwich-court-275-greenwich-street-new_york/4js

360 East 72nd St same unit with a less than $200k renovation sold in 2015 for $1,835,000 so I'm not sure how this shows a strong market today.
https://streeteasy.com/sale/1154487

$200k reno, plus carry plus trouble for renovation in a building with extremely difficult managing agent/board (no professional cert allowed, external special inspection, crappy walls, difficult plumbing) to renovate. That is at least $400k.

So hardly any different.

These charts tell the story in a different way but with same conclusion. New/recent developments are hurting with prices down 13% YOY where as resales are down less than 1%.

https://www.urbandigs.com/newdev-charts/all-manhattan/all-proptypes/all-beds/
https://www.urbandigs.com/resale-charts/all-manhattan/all-proptypes/all-beds/

Sorry ignore. I misread data. New/recent developments are hurting with prices down 2.1% YOY. Clearly, a big drawback of urbandigs data is the use of Median price per sq ft rather than repeat sales.

This is almost funny:
Re-Supply Pace
1,345
New Supply Vs Contracts Signed In September
8306.3% from prior month
49.8% from prior year

Where do you think this oversupply is primarily coming from? Have contracts slowed?

Combo more supply and lower connect activity.

Buyers got the complete edge right now with prices down. But like most downturns, buyers tend to pause, scale back bids, or revert to sidelines and wait it out. Buyers tend to get excited when markets are strong and deals are hard to come by, versus when markets are soft and deals are easier to come by. Nature of the animal.

Tomorrow we get a while batch of new monthly sales and contract activity data, so let's see how October panned out.

I've got plenty of interviews coming out on my blog next few weeks with colleagues. That should also shed some light on current conditions

Interesting thoughts. It seems that both buyers and sellers are overreacting exemplified by unrealistic listing prices and bids? That could certainly slow the market to a crawl.

I'm happy to report we're seeing a lot of buyer activity. Many of our clients are coming off the sidelines after being frustrated by the previous seller's market. We've got a handful of clients who were dormant for 3 years, actively looking again. 3 accepted offers over the last five days including a very solid deal on a downtown Loft, $4m+.

I think enough people have been through the ringer of 2014-2015, and are happy to see prices down and competition thin. Very difficult to call the bottom, however you're definitely getting a discount versus the peak and a much easier time getting to contract.

Also happy to say our listing at the link finally found a buyer. This one took time and patience and a seller that listened to the market and his brokers.

Keith Burkhardt
TBG

End of day, buyers buying now should be happy longer term. All it takes is few consecutive months of buyers realizing it's a good market to bid into, and conditions and leverage can change quickly. Right buyers got it all, discounts, options, weak contact activity to push sellers even more, and strong leverage. Hard to beat that combination of forces.. sure we can drop a bit more but timing this market perfectly is a fantasy for those with real needs to buy

Sorry, meant, Right now, buyers got it all....

I think JP Morgan said something along the lines of people thinking that the are going to hit exact tops or bottoms of markets are fools.

That said by I think it's clear we are just *starting* to see the effects of rising interest rates and it's also clear that those rates still have a ways to go up as the Fed has indicated it intends to keep raising rates. As such, I think we also have a ways to go with prices on the way down.

Keith,
It seems like you're saying that deals are being done now because prices are down. Yet we still have people right here on this thread claiming prices are down/ the market isn't weak. Could you please elaborate?

Sorry, claiming prices are not down.

Noah,
Would you say prices are only down in ultra luxury, prices are down pretty much all across the board, or something else?

One thing I have started to see, which I had predicted, is that with higher interest rates investors are seeking deals with lower rent multiplyers/higher cap rates in smaller multi family buildings. I think it's just a matter of time until this filters down to condominium investors.

It may well be true that there are both buyers and sellers who are now more motivated to make deals but I'm disinclined to think that there are enough of them to turn this market back around in the near term. I think many buyers will continue to remain on the sidelines watching the market while additional frictional supply enters the market to compete with current availabilities. Unless the number of withdrawn product equals the number of withdrawn buyers, it seems that prices will continue to decline.

You may also have a compounding effect with buyers because of interest rates. Let's say you had a buyer who has been sitting on the sidelines because they were looking for a certain apartment but those apartments have been trading at $1.9 million and they can only afford $1.7 million. Now the market comes down to meet that $1.7 million number so we have this buyer re-enter the market, right?
Nope... because with interest rates up now that buyer can only afford $1.55 million, so prices are going to have to come down again.

I think there's something called the taxi driver indicator? My version of that is the "Broker call indicator", in 2014, 2015 it could be difficult to get a broker to return your call for an appointment. In today's market I have an increasing number of Brokers calling me or emailing me every time one of our clients even sniffs past a listing; "so and so was at my open-house, they really seemed to like it, they spent a lot of time here any interest, would they like to get back in?" Even the big dogs are calling or at least their minions with regularity. Certainly nothing wrong with following up, especially when the buyer herd has thinned.

I know a lot of people complained about this Market, we actually had a very solid year. you can look at our closed Deals, Deals in contract on our website. And it was certainly a lot easier to get these deals done. The weakness has become a bit more pronounced since the Labor Day pop never really happened.

@30, no arguments from me regarding the weakening market. But at least for us the buyer action has remained very strong, we're busier than ever and I don't say this to brag. It's the nature of our clients, they finally have the upper hand and they're out shopping for a deal. Some sellers are grasping at straws others are throwing in the towel and pricing for today's market.

Getting my daughter ready for trick-or-treating, so this is a bit of a quick and rambling reply. Happy Halloween everybody!

Keith Burkhardt
TBG

Ximon: buyers certainly are waiting on the sidelines, but when the right deal comes along they're moving on it. I once had a client that summed it up this way, real estate is a 50% financial decision and 50% emotional decision. For those where the financial component is much stronger perhaps they'll sit longer and wait. But for those who have been looking for a couple of years, and put a little bit more emphasis on the emotional component, have a Long View, they're bidding when the right unit appears.

Take it with a grain of salt, but this is what I'm seeing in my very small world.

@30yrs - accross the board. High end, new Dev got hit the hardest. High end got hit hard. Low end did ok for while, but last year or so did it's own thing, albeit not as severe

imo

I'm not sure you have the "taxi driver indicator" (or what ever it's called) correct. If it's what I'm thinking, then it's when you start getting into taxis the drivers start talking about which stocks they are buying then it's time to get out of the market. I think this comes from various stories about Joseph Kennedy or JP Morgan having a shoe shine boy give him a stock tip, realizing that absolutely everyone was in the market and deciding to liquidate his positions just before the market crashed.

As far as brokers calling back:
In 2015 I called a number of brokers to set up a broker's open house tour of 1 BR's in the Prime Village. I couldn't get a single one of them to do it, and I could barely even get a returned call/email about it because they all thought their units were going to sell in a week. I wonder what the situation would be if someone tried the exact same thing today.

Yes, shoe shine boys and hat check girls buying option contracts in the 1920's should have been a leading indicator of the Great Recession. What would be its equivalent today for the residential market? Maybe investors thinking that the market is in the midst of a "minor" correction?

30, I don't see anything for Prime Village, but my inbox has recent BOH Tours for Flatiron, West Village, Meatpacking, UWS 2-BRs, UWS Townhouses, FiDi Premier (whatever that is), Tudor City, and Midtown East under 1 million. That's not counting the Woolworth, which actually merits a tour.

ali r.
{upstairs realty}

I'm not sure you have the "taxi driver indicator" (or what ever it's called) correct. If it's what I'm thinking, then it's when you start getting into taxis the drivers start talking about which stocks they are buying then it's time to get out of the market. I think this comes from various stories about Joseph Kennedy or JP Morgan having a shoe shine boy give him a stock tip, realizing that absolutely everyone was in the market and deciding to liquidate his positions just before the market crashed.

As far as brokers calling back:
In 2015 I called a number of brokers to set up a broker's open house tour of 1 BR's in the Prime Village. I couldn't get a single one of them to do it, and I could barely even get a returned call/email about it because they all thought their units were going to sell in a week. I wonder what the situation would be if someone tried the exact same thing today.

Somewhere along the way, people came to believe it was their god given right to sell their apartment at a profit or—at the very very worst—breakeven. How we got to this place, I don’t really care. But it sure is frustrating. The market is what it is, not what you want it to be.

Somewhere along the way, people came to believe it was their god given right to sell their apartment at a profit or—at the very very worst—breakeven. How we got to this place, I don’t really care. But it sure is frustrating. The market is what it is, not what you want it to be.

Somewhere along the way, people came to believe it was their god given right to sell their apartment at a profit or—at the very very worst—breakeven. How we got to this place, I don’t really care. But it sure is frustrating. The market is what it is, not what you want it to be.

Somewhere along the way, people came to believe it was their god given right to sell their apartment at a profit or—at the very very worst—breakeven. How we got to this place, I don’t really care. But it sure is frustrating. The market is what it is, not what you want it to be.

So sorry for the multiple posts. Not sure how that happened. My apologies.

AM-
Something which often happens in overheated markets is that people trade apartments way too often (like every year or two) and it looks like they are making a whole bunch of money doing it. But transaction and renovation costs especially in New York are tremendous, so while based on gross numbers it looks like big profits, net-net it doesn't really amount to anywhere near what it seems. Then when the market crashes they lose it all back and then some because they lose a good chunk of the gross profit and 100% of all the accumulated transaction costs.
Example:

Someone buys an apartment for $900,000 and a year or two later sells it for $1.1 million. Then they buy another apartment for $1.3 million and a year or two later sell it for $1.5 million. Then they buy an apartment for $1.7 million and sell it for $2 million. They buy a unit for $2.5 million, the market tanks and they sell it for $2 million.
Gross it looks like they are still up $200,000 over all the transactions. What do you think their net position is?

I understand your point, but even if correct, it doesn’t conflict with my premise. People have come to believe that real estate is a guarantee of principal. Which is a stupid (and entitled) principle.

Noah/30, Trying to understand why this chart barely shows down in price per sq ft.
https://www.urbandigs.com/resale-charts/all-manhattan/all-proptypes/all-beds/

Condos only in resales, down less than 2 percent.
https://www.urbandigs.com/resale-charts/all-manhattan/condo/

AM: That is true, but if the market keeps going down, fear of loss will start overwhelming the belief in guarantee of principle. I presume that's how down markets happen.

I've seen some scattered examples of sales at a loss, but they can currently be dismissed as one-offs. Once you get enough one-offs though, that's when reality starts to intrude.

Owner-occupants churning their "portfolios" at increasingly higher prices was obviously a bad strategy. Hindsight is 20-20 but in retrospect, the far better strategy would have been to repeatedly trade down, reducing rather than increasing their exposure to a market that was becoming more risky, and reinvesting the locked-in profits in other types of investments. If they had followed this strategy over the past 10 years, investing their gains in the stock market, how much better off would they be today?

But perhaps more impactful than the activities of owner-occupants was the presence of outside investors who made the erroneous assumption that prices would keep going higher and they could sell at any future time at a profit. These investors are now facing the harsh realities of the cyclical market that is US real estate and the market will now suffer even more due to their participation.

https://medium.com/@noahrosenblatt/talking-manhattan-the-brian-morgan-team-at-citi-habitats-c0c70036ecb2

Figured this might be of interest.

30 - I'll check tomorrow

Urbandigs - another extremely interesting video. Thank you.

Noah,
I love these videos, but some constructive criticism you need to work on the audio - especially when you have a bunch of people. It may be that the room is a bit too "live"; also you can get so mics which are specifically geared towards podcasting relatively cheaply these days.

I second 30, I thought, it but I didn't write it.

Noah, while you are taking recommendations, I wonder if you thought of doing surveys of buyers, sellers or brokers to get an even better leading indicator of the market? Days on Market, Availabilities and Contract Volume are indeed good leading indicators but are still based on closed or contracted deals. Surveying market participants in listings might reveal trends not yet showing in even the most recent closed and contracted transactions.

ximon,
I think the problem with that is you are largely going to get biased answers.

Perhaps but I think it would depend on the questions asked and how they are analyzed. And comparing responses from different categories of participants could be revealing as well. Even something like a customer satisfaction survey could be very revealing. I understand large regional brokers like Coldwell Banker out on the Coast do these kinds of surveys.

As far as certain segments of the market being "only down 2%", I think in addition to velocity you need to look at acceleration. If a market had been idling along for a decade at 0% to 2% annual increase and one year dropped to -2% it's one thing, but if a market was chugging along at 5% to 10% increases or more and now it's at -2% it is a horse of a different color.

One thing mentioned in the podcast is potential purchasers are looking at the rent vs buy comparison. Check out this chart and think which way people using that metric will be leaning:
https://www.millersamuel.com/charts/manhattan-rental-to-sales-price-ratio-median-annualized/

30, Do you agree that the resales are only down 2 percent or so in price per sq ft? If so, we have no disagreement as many people are painting everything with the same brush of 10-20 percent down.

It would be a grave mistake to look at "only down 2%" as any kind of marker. Not a leading indicator at all.

I also do not believe that many serious buyers perform a buy vs. rent analysis and if they did, probably did it wrong. In any case, Miller's yield rates don't make sense to me as my admittedly more limited analysis for mid to high end condo offerings in the past 6 months shows returns much closer to 2% than 4%.

I'm pretty sure that Miller's yield rates don't include any ongoing costs (common charges, taxes, vacancy, repairs, Etc) and are solely based on purchase price vs rent.

In terms of whether or not buyers are doing a rent vs buy analysis I would agree that over the past decade potential purchasers have not been doing it because if they had then I don't think they would have made the decisions which they did. But when this broker says he is seeing purchers making that comparison (I think he said that ?) If you take him at face value then I think you have to agree with him when he says it will lead the buyers not pulling the trigger at these prices. He also echoed something I said on this forum a while ago, which is that the softness in the rental market (with landlords giving unprecedented concessions of up to 3 months plus paying the broker - which in reality is the same thing as huge rent reductions) is going to translate to softness in the sales market as we see both huge increases in supply and decreases in demand. And I flog this dead horse some more and reiterate that rising interest rates only exacerbate all of these issues.

Cumin, I am just looking at facts as many poeple have declared that all segments of market are down a lot and high end can not go down by itself. We have top end correction of min 20 percent vs actual sales (more vs aspirational asks) and what did we get for resales? 2 percent after bear have crying that every thing is down a lot for the last year. Not we even have had the slowest months in the data.

Cumin = ximon

300, valid points and I am indeed one of those saying all segments are impacted (I did not necessarily say down) and that luxury does not operate in a bubble. But the trickle down from luxury takes time just as the impact of higher interest rates, lower rental yields etc. etc. takes time for the market to fully absorb which is why I think -2% should not be viewed in any sense as a marker of where the market is. I suspect it will get worse and no one should be optimistic about current or anticipated market conditions over the near term. We are on the early downward curve of the current cycle.