I know Jonathan Miller doesn't inspire the highest level of confidence at all times, but I certainly find his tempered reaction quite logical and level-headed here. A lot of people repeat the mantra that investing in real estate is a long-term thing, but are quick to get excited in favor of either extreme. Either way, it'll be interesting from here on out: "About a week after 9/11/01, seven years... [more]
I know Jonathan Miller doesn't inspire the highest level of confidence at all times, but I certainly find his tempered reaction quite logical and level-headed here. A lot of people repeat the mantra that investing in real estate is a long-term thing, but are quick to get excited in favor of either extreme. Either way, it'll be interesting from here on out:
"About a week after 9/11/01, seven years ago to this very day in fact, I remember a real estate broker telling reporters that the market had fallen 30% over the prior week and was expected to fall much further. I got calls from several reporters to confirm or to provide empirical evidence to support or disprove the claim.
Falling 30%?
I basically said:
How can someone describe a market as “falling” only days after a significant event occurs when there is no activity to base such a conclusion? What is the basis? A client conversation concerning one deal?
When someone loudly calls a market (up or down) based on anecdotes rather than evidence, it’s irresponsible. Everyone is entitled to their opinion, but it should not be presented as fact.
At that moment back in 2001, who would have anticipated one of the biggest housing booms in US history (and we are painfully unwinding from that expansion right now) was soon to follow?
Fast forward 7 years.
A high end Manhattan broker did the same thing today. Without empirical evidence (no data), who can state the market is instantly is down 25% a few days after the Lehman bankruptcy?
Was this pronouncement based on a handful of conversations with past clients? A gut feeling after years of experience?
Quick, call the SEC!
I suspect this was simply extracurricular media commentary by the individual because the brokerage firm is one of the big three in New York and has a great reputation.
Don’t get me wrong, I like Brian Ross’ work and ABC, but he falls short with headline…”Top Broker: NYC Real Estate Already In Steep Decline” …is considered “investigative journalism“? It’s more like entertainment journalism, no?"
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Response by nyc10022
almost 18 years ago
Posts: 9868
Member since: Aug 2008
all true, but lets be fair now... the media ate up all the fluff and bullshit on the way up, so why expect anything less all the way down?
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Response by lowery
almost 18 years ago
Posts: 1415
Member since: Mar 2008
I don't think the broker being referred to claimed RE prices had fallen that much in the past week; rather, since the "credit crisis" began summer '07. 9/11/01 was a one-day event. People did pull out of R/E contracts. Some forfeited deposits voluntarily. Some sellers graciously let their buyers walk away and returned escrows. R/E was dead for a few months, and there were substantial price reductions. But only a temporary panic. Come spring, the boom started, with no discounts.
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Response by nyc10022
almost 18 years ago
Posts: 9868
Member since: Aug 2008
Well, per the stats, we already had 6-7% decline through July August. Would another 15% through September be *that* crazy? Even without the crisis, we were probably talking another few points in the averages.
all true, but lets be fair now... the media ate up all the fluff and bullshit on the way up, so why expect anything less all the way down?
I don't think the broker being referred to claimed RE prices had fallen that much in the past week; rather, since the "credit crisis" began summer '07. 9/11/01 was a one-day event. People did pull out of R/E contracts. Some forfeited deposits voluntarily. Some sellers graciously let their buyers walk away and returned escrows. R/E was dead for a few months, and there were substantial price reductions. But only a temporary panic. Come spring, the boom started, with no discounts.
Well, per the stats, we already had 6-7% decline through July August. Would another 15% through September be *that* crazy? Even without the crisis, we were probably talking another few points in the averages.