Why haven't prices in NYC fallen more steeply already?

Because co-ops dominate the market, and prices are so high that even in the most frou-froulicious of times, you couldn't get a 90-10 no-doc loan for condos. And the vast majority of people I know (anecdata obviously) are very financially conservative and were always afraid of getting burned in the RE market. As a consequence, most are renters.

And every time I google a really outrageous comp, it turns out that there's family $ behind it. Or substantial wealth.

is k2 the same as the anon3 guy?
and nyc10023, what are you in relation to nyc10022?

No relation whatsoever.

The timing of NYC RE is always two years behind the rest of the country. The rest of the country is not so heavily reliant on Wall Street's cycle as New York is. Also, most co-ops allow two years and only two years of continuous subletting, and when that's up, pfffffffffffffffffff . . . .

nyc10023: anecdata <-- great word!

most people have a year or two of cushion before a forced sale...

The mass purging on Wall street has only just began the last 6-8 months, the dollar was weak till recently allowing foreigners to buy up Manhattan cheap and unemployment just now is starting to accelerate probably hitting 8-10% the next 12-18 months.The stock market collapse the last three months or so and subsequent collapse with foreign markets have made the dollar the only safe currency other than the yen for now driving up it's value. Being that the Treasury printing presses are running full steam eventually our current 11-12 trillion dollar national debt will drive up interest rates because China who's own economy is now drastically slowing down will have no appetite in buying our debt notes without demanding higher interest rates. This will drive up mortgage rates to much higher levels and it will drive down real estate even more.....just watch this is only the third inning.

Anyone care to comment on WHY the timing here in NYC is so far behind the rest of the country?

Good Morning..For manhattan the answer to your question is....lack of inventory, minimal subprime loans, very few foreclosures and my personal favorite, continued high demand.

9000 apartments is a lack of inventory? When you lose your job and your expenses are now greater than your income and you have no substantial savings, doesn't your loan become a sub-prime loan? If so, I would argue there is a plethora of sub-prime loans out there. And continued high demand? Is that why sales volume is off 25-30%?

Inventory is about 9000, contract signings are under 400/month, contract cancellations are on the rise, huge layoffs, tens of thousands more new units to enter the market through 2010, huge losses in personal wealth and income, overcorrection in underwriting standards, bizarre and unsustainable rent/buy numbers, reduction in city plans for new school construction, announcements of reduction in services, increases in taxes, decreases in police presence, record-high numbers of families entering homeless shelters these past few months, apartments on the market for hundreds of days, increasingly evident price reductions, inability and unwillingness of foreigners to maintain NYC properties, even without the subprime loan market a huge amount of personal overleverage. Yes, as usual, NYC lags in real estate downturns. But we almost always catch up.

While you aren't going to undo a decade + of price increases in 6 months and there are many different factors, I think one psychological influence is that everyone who bought years ago has been licking their chops along the way. Like stocks you don't make money or lose money in RE until you sell. Well, sellers have been counting their appreciation over the years as gains. If you bought in 1999 for $395,000 and could have sold in 2007 for $1.395 million and today you could sell for 1 million many sellers don't see an amazing $600,000 dollar profit but see a loss of 395k. I think this is slowing down the market but will change with time as the RE peak becomes a more distant memory.

Historically, prices in NYC follow jobs and the job losses are just starting to happen.

Anecdotally, there clearly is a standoff between sellers and buyers -- the volume of transactions is slowing markedly. But that wasn't reflected in the 3Q reports, it's just starting to happen now.

Prices won't soften until sellers capitulate -- which doesn't seem to be happening in a broad sense. The majority of Manhattan inventory are personal residences, and sellers with jobs can often remain bunkered in rather than being forced to sell.

In addition, money, although tough to get, is still quite cheap, with interest rates half of what they were in the late '80s/early 90s downturn.

That said, we are starting to see prices soften in a couple of submarkets -- I've heard stories of discounts on both new dev resales and studios.

However, they're not the 30%-40% slides that have been predicted by the bears on this board -- for that to happen, we'd have to see a couple of years of significantly higher unemployment in New York City, and probably drastically higher interest rates.

ali r.
{downtown broker}

"It seems reasonable that NYC prices SHOULD have fallen more precipitously already, if they were going to. "

Who said they haven't? How do you define "more precipitously".

Miller Samuel numbers said we lost 9.4% (Median Manhattan) in just *one quarter*. And that was before the real panic.

Urban Digs is now estimating 15-18% down already.

Yes, we started later, but thats almost the average decline for cities. When we see the Q4 numbers, I have a feeling we'll be beating them.

Given that we're *in* Q4, that would mean prices have already declined quite substantially.

Granted, I think we have ways to go...

I think a key reason is that most buldings are coops that require a minimum 20% down and are more thorough than banks when approving tenants.

This discouraged flippers who flooded other markets with 0% ARM loans and decided to walk away when they couldn't sell/afford to pay increased mortgages.

Ali,
You can already find 30-40% price reductions, some of which are from prices that seem as though they would have been reflective of the market earlier this year. Look at the number of price cuts, and compare that to the last six years. I have used the same broker for eight years and will continue to use him until I quit doing transactions or he quits the business, and he has told me this is a nightmare. Significantly higher unemployment and drastically higher interest rates, and I might even start to believe the uber-bears who think we'll return to mid-1990 pricing rather than the 2001 I expect.

aboutready has it right. you can buy certain apartments in manhattan RIGHT NOW for 2003 or 2004 prices (see discussions of comps for evidence). Real Estate was not exactly depressed at that time but 40% off or so from the peak is doable right now. Most apartments are down significantly less than that but aside from a few examples they aren't selling. The time for discussions about why prices haven't come down are long past. They have come down.

uptowngal, purchasing a coop with a healthy balance sheet in no way guarantees that you'll keep your balance sheet healthy (which is why many coops are now requiring money in escrow, rather than just in the bank). How many coop owners do you think went and bought property in the Hamptons? The well-off have been overleveraging as well, and liquidity may be even harder in such circumstances. Selling a place in the Hamptons is probably much harder than selling the coop you bought in 1998. And selling the place in the Hamptons along with the condo you put 10% down on in 2006, well that has to hurt.

Happyrenter - I agree with you on this one. There are still plenty of unrealistic listings and plenty of places for sale that have not adjusted (I would aregue even most of the listings are unfairly priced). However, there are a significant number of listings that have been reduced significantly - and STILL aren't selling. This suggests prices may have even further to fall ...

Just a couple of thoughts.

First, I think it may be important to understand how many of the 9,500 apartments on the market HAVE to be sold compared to how many of them are for sale. A big factor in determining how long a person can sit with their apartment on the market is how badly they must sell it. I don't know what the answer is in NYC, but I imagine a year from now we will have a better idea of what that percentage of "desperate" sellers is.

Second, what impact does a financial aid package have for those who own in NYC? For instance, one of the ideas being tossed around (I know there are many) is to reset all home mortages to a fixed rate of 5.5% across the nation. If this occurred (and I know it is not set in stone by any means / it's just an example) could it help contain the losses in RE? It would give homeowners in NYC several hundred dollars (or more) additional per month to be plowed back into the local economy, helping busineses and giving the city much needed tax revenue and lowering their monthly carrying costs.

Thoughts?

Waverly,

It is virtually inconceivable that a mortgage bailout will be extended to jumbo mortgages. If I am right, this would have no impact at all on most Manhattan real estate.

The question of who 'has' to sell is only interesting at the start of a bear market. As the downturn goes on and on, financial reversals and, perhaps more significantly, natural changes in life (death, divorce, job relocations, births, illnesses, etc), cause more and more apartments to enter the ranks of the 'have to sell' group.

I sold my apartment in 2007 and I would expect to be able to buy back an identical apartment for half the price (or less) a year from now. Buyers, sit tight.

@happyrenter and @aboutready:

I haven't seen apartments closed at 30-40% off 2006-2007 comps, but if you guys want to show me sold units like that I will stand corrected.

If that's happening it's certainly isolated, because if it were widespread we wouldn't be in such a volume stall. From my point of view that's the "nightmare" -- that it takes months and months to move anything, and very little is moving.

ali r.
[downtown broker]

front_porch,

obviously i can't show you any closings 30-40% off comps since it takes three or more months for apartments to close. i can show you apartments that are ASKING 30-40% off of comps--and still haven't sold. That should be just as good (if not better), right?

I looked at this apartment last Winter. It is approximately 1900 square feet, nice but not spectacular views, and needed a serious renovation:
http://www.streeteasy.com/nyc/sale/135975-coop-33-fifth-avenue-greenwich-village-new-york
It went on the market last October for 3.75 million.

Based on this comp, a 2100 sq foot apartment right across the street, in an equally coveted gold coast building, 16th floor, also with a decent but not spectacular view, and also requiring a significant renovation, went on the market a few months later asking an identical 3.75 million.
http://www.streeteasy.com/nyc/sale/345766-coop-30-fifth-avenue-greenwich-village-new-york

The first apartment needed slightly less work, perhaps, and had slightly better view. The second apartment was larger, but both me and my broker thought they were about equal, and about equally overpriced.

The first apartment sold for 3.65 million last April:
04/11/2008 #15-AB $3,650,000 -3.8% $3,795,000 3 beds 2 baths

The second apartment is still on the market, and after various reductions and a change of broker, it now asks $2.4 million, and it still hasn't sold.

That is 34% off the SALE price of the comparable unit (slighly more off the original ask, but that's not important). And it still hasn't sold. I'm considering offering $1.8 for it, just to see how desperate they are, but really, I think things are so bad in NYC real estate right now that prices could come down even a lot more than that.

happyrenter, the mortgage plan that was discussed did not limit the reset to conforming loans only. All loans would be considered.

Here is another one:

http://www.streeteasy.com/nyc/sale/364607-coop-151-east-83rd-street-upper-east-side-new-york

5D is now asking 995,000--again after multiple cuts from 1.675 and a change of broker. This compares to a sale in 2004 of an apartment in the same line, two floors lower:

06/16/2004 #3D $1,150,000

5D is beautifully renovated; I don't know the condition of 3D. But let's just assume they are identical apartments (in fact, 5 has a much nicer view). This is a 12% decline from 2004! That would put us in 2002 or 2003 territory, and again, the apartment still hasn't sold.

"I don't know what the answer is in NYC, but I imagine a year from now we will have a better idea of what that percentage of "desperate" sellers is."

Meaningless. RE prices are defined at the margins. You don't need all or most to be desperate. Hell, you don't need more that a small portion. But if they are the ones who lower their prices and sell when nothing else is selling, they are defining market price. Doesn't matter how many "don't have to sell", what matters is who sold and at what price.

NYC - I agree with you, but it would impact the inventory numbers and psychology. Furthermore, if many additional people need to sell it will put more people at the margins. Also, if 100 of the 9500 need to sell and everyone else can wait, then there is going to be more of a stand-off and not much movement.

aboutready, my point was responding to the question of why hasn't NYC dropped as much as the rest of the country at this point. And the reason is that we haven't been affected by the same factors.

Coop owners might have flipped - or attempted to flip - houses elsewhere but they haven't flipped their primary residences because it's difficult to do so. This is one good reason why you haven't seen the same rate of foreclosures in Manhattan as in, say, FL or NV.

And coops with weak balance sheets will be affected. But that's a different issue than RE sale prices.

This doesn't mean that NYC won't feel any pain, just that our timing is different for these reasons.

Things are down easy 20%, maybe more if you project to the level that would be necessary to actually get sales done. Coop boards are the main reason Manhattan lags. Also it lags because finance is a late cycle business relative to the rest of the economy. The mass firings on Wall Street only started with Bear in March. 2009 is a guaranteed bloodbath. There was plausible deniability before Lehman, AIG, the last 20% in the S&P. No more. The number of qualified buyers for $1mm+ apartments will go to shit next year as they must show 2008 income to banks and coop boards at that time.

Here's another one Ali.

45 Christopher has a beautiful, renovated 8th floor combination, 8AG. The two units that were combined are essentially identical one bedrooms. The combo went on the market at $4 million, and has been gradually reduced to $2.595 (and hasn't sold):

http://www.streeteasy.com/nyc/sale/231290-condo-45-christopher-street-west-village-new-york

In December 2007, 10G sold for over 1.5 million, and it needed a very significant renovation:

12/10/2007 #10G $1,503,500

Both units have basically equivalent Empire State views. My back-of-envelope calculation is you have to add (conservatively) 200k to the price of 10G for renovation. So that would give you a price of 1.7 million. Multiply it by 2, for a double-sized apartment, and you get 3.4. A reduction from 3.4 to 2.595 is a 23% reduction.

But obviously that understates the reduction significantly, since a 3 bedroom in the prime village has a MUCH higher average ppsf than a one bedroom. This was undoubtedly the comp they used to price the apartment at 4 million to start with.

> NYC - I agree with you, but it would impact the inventory numbers and psychology.

Only if prices haven't yet declined... as those are leading indicators.
Once the Q4 numbers show major declines, folks aren't going to be talking inventory numbers anymore... they'll be talking price numbers.

"Also, if 100 of the 9500 need to sell and everyone else can wait, then there is going to be more of a stand-off and not much movement. "

We already had the stand-off. But now we have the movement. We're way past "waiting", its here.

And you missed the bigger point (even though you said you agreed). If those 100 need to sell, and they will, the prices they get define the market. Doesn't matter if the other 9500 are "waiting it out" or "shitting in their pants" or "wealthy irish carpenters". They can't stop the decline at the margin.

nyc10022, you will find that most people have trouble with the concept of the "marginal" buyer or in this case seller. and yes, you nail it that once Q4 figures come out, the asks will be reset down and the real fun begins.

No response to my comps by the remaining bulls in here? I take that as an acknowledgement that there are apartments to be had, RIGHT NOW, at 30-40% off peak.

"nyc10022, you will find that most people have trouble with the concept of the "marginal" buyer or in this case seller"

Agreed. Granted, most folks have trouble with the concept of well... anything.
;-)

In all seriousness, if more than a handful of folks understood basic economic principles, we would never have had the bubble in the first place.

Cycles of greed and fear are human nature, and according to some studies unavoidable. That said, the idea that people can hold the line by not selling really pisses me off. Not selling doesn't prevent the decline any more than not selling a stock changes the paper gain or loss you have.

lol nyc10022, how true. it's amazing how many people get sucked up in the euphoria of a bull market--and now watch them get sucked down in the hysteria of a bear market. Markets can overshoot on the downside just as badly as on the upside.

fortuantely, bear markets tend to last a long time, so there will be no rush to get in at the bottom. just wait, people, and watch the prices tumble.

Rhino - can't blame people for not wanting to sell if they really, really, really have the option to hold for a LONG time (greater than 5 years). I just don't think many sellers really have that option. I think a lot of the "hold outs" are people who think things will turn around quickly. But they won't -I don't see an economic recovery during 2009 or even 2010 necessarily, and even if things do turn around in 2010-2011, real estate, as always, lags the market.

Stocks are totally different because many people who have money in stocks have a long-term horizon so I understand not wanting to take loss by selling now. Actually, the people I laugh at are the people who sold in mid to late October AFTER stocks had already fallen. It's not that I was/am a buyer of the Dow in the low 8000s - I have been out the market since summer 2007 when the credit markets began to stall). It's just that I think to sell after stocks have fallen 35%-40% already is to sell after the biggest hit has already occured (I see another 10%-20% additional downside now), and to lose the opportunity to ride the potential upswing later. While I don't think it's necessarily coming soon, I think it's hard to time markets exactly, although much easier to time them within 6 months-1 year (e.g., stocks peaked in October 2007 and I sold in June / July 2007 - so I missed out on a few months of upside but still glad to have gotten out when I did).

NYC - I agree with you that prices have declined (and will likely continue to), but if the overwhelming majority of sellers do not need to sell and instead hold onto their apartments and/or take them off the market the inventory number would not go through the roof. When the economy stabilizes they could put them back on the market and again, continue to hold until they get a price they like. Since the economy is improving they have a better shot of getting a higher price. Not at 2006 levels, but they would get more than now.

happyrenter,

Have you seen 151 east 83rd, 5D? I agree that the bedrooms and living areas are in nice condition, but it seems like the bathrooms & kitchen could use some serious updating. still, though, 995k for a legit 2-bed in PS 6 seems reasonable. If you put down 30%, that 700k mtge (still conforming for '08) gets you to about $5k mtge + maint after tax deductions. I think you'd be happy finding a similar-quality rental for that amount

printer--
I like the kitchen and bathroom--I think they need work, but that they don't need major renovation. That's just my taste. But I basically agree with the larger point.

"No response to my comps by the remaining bulls in here?"

why would anyone respond. for one thing you've discussed the same 3 or 4 apts multiple other threads. I am very bearish on NY RE but I would note it is very easy to find examples of apts that were stunningly overpriced when they came on the market and yes of course are going to suffer huge price drops.

"That said, the idea that people can hold the line by not selling really pisses me off."

"can't blame people for not wanting to sell if they really, really, really have the option to hold for a LONG time (greater than 5 years). I just don't think many sellers really have that option."

These two quotes are simply hilarious.

"NYC - I agree with you that prices have declined (and will likely continue to), but if the overwhelming majority of sellers do not need to sell and instead hold onto their apartments and/or take them off the market the inventory number would not go through the roof. When the economy stabilizes they could put them back on the market and again, continue to hold until they get a price they like.

Yeah, it is this kind of thinking that extends downturns *significantly*. These folks are going to have to hold on for a LONG time to "get a price they like".

"Since the economy is improving they have a better shot of getting a higher price. Not at 2006 levels, but they would get more than now."

Not quite, RE lags the economy. And in NYC, its lagging it by multiple years. Prices will be lower in a year, and probably lower in 2 years. If they want to wait 10 years, hey, fine, but a nominal break even which is really a real major loss is not a good reason to do that

Overall, its exactly this kind of thinking that makes things worse, and has folks see bigger problems than if they had just sold when they needed to. Folks in Miami and Vegas who tried to "wait it out" are absolutely screwed now.

Sorry to burst the bubble here (pun intended), but that just isn't how RE markets work. Prices are determined at the margins, and then declines beget fewer buyers. Take a look at how every RE bear market has worked in the past. "Riding it out" to sell when it recovers never works. If you have a genuine long term approach - as in you consider it your HOME, not an "investment" - you are in a better position.

But waiting for a "recovery" is not a particularly good bet if your goal is to sell.

Miami and Vegas are not comparable situations but pefect for my point. There was heavy speculation in those areas and people truly had to sell their properties. In NYC, there is likely not anywhere near that amount of speculation-inspired need. Yes, NYC will have layoffs and a down economy, but so will everywhere else. It is possible that the number of people in the must-sell camp in NYC are limited and they would limit the amount of sales at lower numbers.

Also, if you don't have to sell, then it is easier to hold out for higher offers when the economy is on the upswing. You can point to comparables all you want, but if the seller doesn't have to sell they don't have to take a lower offer. When the economy starts to improve, NYC will bounce back better than most areas.

I am not suggesting that there won't be pain, just that there should be some balance to the almost gleeful way that some posters are predicting NYC RE being at mid-90's levels. Things are often a lot more murky and gray than people would like them to be, so I don't think it is going to be a quick 10% drop and I don't think it will be a drop back to 1995 prices. Either of these would just be too "black & white" to me and neither would have much data to support it.

Uh, aren't we past the "NYC is different, RE won't go down here" stuff already? Do we really need to rehash this argument already?

Yes, Miami/Vegas are different. They didn't have ANYWHERE near the bubble we did.

> NYC, there is likely not anywhere near that amount of speculation-inspired need.
Anyone who leveraged themselves into an apartment they could not afford is a speculator, like it or not. They were banking on appreciation. If you think we didn't have that in NYC, wow, were you not watching.

> Yes, NYC will have layoffs and a down economy, but so will everywhere else.

If you can't tell the difference between what is happening to jobs and income nationally, and to jobs and income in NYC, then I'm not quite sure what to tell you than... you are living in a fantasy land.

> When the economy starts to improve, NYC will bounce back better than most areas.

I'm guessing by this you don't actually live in NYC?

Seriously, do you know anything about the financial makeup of NYC?

The things you are saying are IMHO downright ludicrous.

"You can point to comparables all you want, but if the seller doesn't have to sell they don't have to take a lower offer"

Again, they don't have to take it. They just need one other person in Manhattan to.

Its like saying "yes, my dot com stock is trading for 5% of what I paid for it. But I didn't lose anything because only THOSE guys are selling shares".

Riding out a loss doesn't make it anything other than a loss. And, in most cases of RE, it just makes it worse, particularly with significant leverage and carrying costs.

"Cycles of greed and fear are human nature, and according to some studies unavoidable. That said, the idea that people can hold the line by not selling really pisses me off. Not selling doesn't prevent the decline any more than not selling a stock changes the paper gain or loss you have. "

Better said than me, Rhino...

lol, yes very well said

I didn't lose any money on webvan.com. I'm just riding it out. For the next 6,000 years.

can you live in webvan.com?

NYC - I live in NYC, am a partner in staffing firm and my client base is the financial services industry, so I know full-well what the economic and jobs situation is in NYC....far better than you do actually!

"Anyone who leveraged themselves into an apartment they could not afford is a speculator, like it or not. They were banking on appreciation."

You have zero anecdotal evidence of how many people that bought properties now must sell before they default or how many people stretched to buy their apartments or how many people cannot afford their payments, do you? You have made a blanket statement about the entire NYC market and anyone who disagrees with you is wrong...that is just very rigid.

The jobs situation in NYC is different from the rest of the country. When it gets hit, the decline and fallout are worse for industries/businesses that have any connection to the financial services world and the jobs situation picks back up with more speed as well. The banks will succeed and find other ways to make money...that is what they do. Will it be like 2006? No, but that doesn;t mean the industry won't function like it did in 2004 from a jobs/profit standpoint.

Furthermore, NYC gets revenue from tourism on a level like no other city in the world and that will aid in it's recovery. You speak with authority, but you are not infallible with what you say. You show no openness to the possibility that you could even be wrong.

Finally, nowhere did I suggest that RE in NYC wouldn't go down, in fact I said that it would. I am simply proposing a more moderate view of the situation and everything you are saying is so extreme that even moderate statements are being called out for being naive and that is quite disappointing.

If my ex-roommate have lived in a webvan for six months instead of the real thing, would she only have been a virtual tramp?

> so I know full-well what the economic and jobs situation is in NYC....far better than you do
> actually!

All evidence to the contrary.

Though that you have a VERY vested interest in making it sound like things are a-ok when they aren't, I understand that.

"You have zero anecdotal evidence of how many people that bought properties now must sell before they default or how many people stretched to buy their apartments or how many people cannot afford their payments, do you?"

First off, you are contradicting yourself. If its anecdotal, it wouldn't be a number. I have tons of anecdotal examples, but thats not the point. Point is the number doesn't matter. If 97% of the city is "holding tight", then what happens in the other 3% is what matters. You keep missing that point. Illiquid markets are determined at the margins. This is economics 101.

"You have made a blanket statement about the entire NYC market and anyone who disagrees with you is wrong...that is just very rigid."

No I didn't, you did. In fact, I did the opposite. I said its the margins that matter, not the "entire" market. YOU are the one with the ridiculous blanket statemets, about how we're going to bounce, and that there was no speculation. Don't make false claims.

> When it gets hit, the decline and fallout are worse for industries/businesses that have any
> connection to the financial services world and the jobs situation picks back up with more speed as > well.

This is not supported by logic or history. If you want to make a point, back it up with facts. Right now, this is just a blanket statement, exactly the kind you accused me of... and it is not supported by anything.

> Furthermore, NYC gets revenue from tourism on a level like no other city in the world and that will
> aid in it's recovery.

Your logic is bad. You're actually helping to make the opposing point.

NYC was getting a good amount of income from tourism, yes. Unfortunately, tourism is exactly one of the things that gets hurt worst in a downturn. Meaning one of the "supports" of NYC income will be seriously damaged (it is already). Global recession + the flip side of a low dollar... the recovery... means that this part of NYC income is especially at risk.

> You speak with authority, but you are not infallible with what you say. You show no openness to
> the possibility that you could even be wrong.

You are entitled to your opinions, but they are only that. No support for any of it, just wishful thinking. You don't seem to understand how markets work, or how NYC financials work.

You also seemed to COMPLETELY miss that Wall Street is DIRECTLY respondible for 30% of NYC income. Add in lawyers, restaurants, etc., you probably get closer to 30-40% indirect.

And that revenue stream has just been cut in HALF, and will not be bouncing given that the entire industry is shifting to a less leveraged one. And much of the already created wealth went down in restricted stock that is now worthless.

If you somehow think that the impact on NYC real estate is just coming from "the recession", then you don't seem to understand the industry that you work in.

Of course, I don't take real estate market advice from brokers, either, so this is no surprise.

> Finally, nowhere did I suggest that RE in NYC wouldn't go down, in fact I said that it would.
> I am simply proposing a more moderate view of the situation and everything you are saying is so
> extreme that even moderate statements are being called out for being naive and that is quite
> disapointing.

I think your problem is you don't get all the information, just the info you want.

My position is NOT extreme. My predictions for this market are in the middle of where the folks on this board are on. Your statements are NOT moderate. Given that we're not full blown in a recession and market crash, calling for break evens in a few years is pretty darn extreme.

Don't hold yourself out as the voice of reason. You are the voice of unrealistic illogical wishful thinking.

The decline is in. Is it the end of the world? No. But just as saying RE will go down 97% is ridiculous, so is denying the impact of the trends that have ALREADY HIT.

That *is* naive.

I can't help but think that tourism will be a negative. We are and have been building way too much lodging, which will only intensify the commercial real estate problems, which will affect residential due to loss of wealth. Our dollar is way too strong, and businesses are cutting out business travel like they've found a new religion. Soon CNN won't be the only ones using the hologram machine. Plus, the rest of the world has just discovered that they're broke too, even Dubai. Americans can barely afford a new WII game, much less tickets to the Big Apple.

My broker told me that the end of the 10% down and 10% HELOC was one of the things killing sales in new developments (this was said prior to the recent credit icification), he also said the end to the 421a program would do the same. Wouldn't that tend to indicate that people were relying on them to get loans that they wouldn't otherwise have been able to get? 10% down loans, at 4 times income, with rising real estate costs over time (sometimes only five years before abatement ends and greatly increases taxes), that doesn't seem too prime to me. Stretching, perhaps? It's impossible to quantify yet, but it's definitely out there.

One thing that people rarely discuss is the empty nesters or simply retirees or close to retirees who live in the city. If you've held onto an apartment for twenty years, and you've seen your stock portfolio dwindle (many people have a hell of a hard time moving into cash and bonds as they ought to, particularly in an environment such as the one we've just seen), would you wait a couple of years or maybe cash out now so as to protect some of your retirement money? I guess it depends, but I would be very tempted to at least try to maximize those gains.

Well the one consistent thing about markets is the public always being on the wrong side. Sellers were "holding steady" in early 2008, and man does that look stupid now. In 2-3 years, they'll finally acquiesce to sell, probably picking the absolute bottom of the market.

Same for the stock market. We hit the biggest fund outflows in years just as the dow was touching 8,000.

@happy renter, I see your comps and your arguments, but . . .

I've never sold in 45 christopher. When I look for apples-to-apples comps, I get

#14E June 2006 $2.199M
# 7E October 2007 $2.5M

if it's valid that the units are similar (and I don't know, because I haven't seen them) then the 30-40% off argument would require another E-line to sell at $1.5M-$1.8M. Time will tell us whether that happens.

I show the combo AG as an expired listing, so it has clearly been sitting on the market for awhile, but saying that it "ought" to sell at twice the price of two one beds plus renovations -- and that it didn't -- is not necessarily the right pricing argument. The right pricing argument is, what did 3-BR, 2-BAs LIKE IT sell for in the West Village in 2006, and has it fallen 30%-40% from those prices?

And I can't answer the first part of the question, because I was just starting in 2006,but my sense of the market is that the people who needed 3-BRs in 2006 that would have found a unit like this, at under 1600 square feet, too small, and would have been pushed down to Tribeca in search of more space, even if they would have paid more in absolute dollar terms for it. A family of four, which one imagines is the "typical" buyer for a 3-BR apartment, might for instance prefer a larger, open kitchen.

Also, monthlies on this are over $2800 -- and high monthlies often push the prices of combos down (which would have been an effect that took place vs. other inventory in 2006, and vs. other inventory now).

ali r.
{downtown broker}

"> so I know full-well what the economic and jobs situation is in NYC....far better than you do
> actually!

All evidence to the contrary.

Though that you have a VERY vested interest in making it sound like things are a-ok when they aren't, I understand that.

"You have zero anecdotal evidence of how many people that bought properties now must sell before they default or how many people stretched to buy their apartments or how many people cannot afford their payments, do you?"

First off, you are contradicting yourself. If its anecdotal, it wouldn't be a number. I have tons of anecdotal examples, but thats not the point. Point is the number doesn't matter. If 97% of the city is "holding tight", then what happens in the other 3% is what matters. You keep missing that point. Illiquid markets are determined at the margins. This is economics 101.

"You have made a blanket statement about the entire NYC market and anyone who disagrees with you is wrong...that is just very rigid."

No I didn't, you did. In fact, I did the opposite. I said its the margins that matter, not the "entire" market. YOU are the one with the ridiculous blanket statemets, about how we're going to bounce, and that there was no speculation. Don't make false claims.

> When it gets hit, the decline and fallout are worse for industries/businesses that have any
> connection to the financial services world and the jobs situation picks back up with more speed as > well.

This is not supported by logic or history. If you want to make a point, back it up with facts. Right now, this is just a blanket statement, exactly the kind you accused me of... and it is not supported by anything.

> Furthermore, NYC gets revenue from tourism on a level like no other city in the world and that will
> aid in it's recovery.

Your logic is bad. You're actually helping to make the opposing point.

NYC was getting a good amount of income from tourism, yes. Unfortunately, tourism is exactly one of the things that gets hurt worst in a downturn. Meaning one of the "supports" of NYC income will be seriously damaged (it is already). Global recession + the flip side of a low dollar... the recovery... means that this part of NYC income is especially at risk.

> You speak with authority, but you are not infallible with what you say. You show no openness to
> the possibility that you could even be wrong.

You are entitled to your opinions, but they are only that. No support for any of it, just wishful thinking. You don't seem to understand how markets work, or how NYC financials work.

You also seemed to COMPLETELY miss that Wall Street is DIRECTLY respondible for 30% of NYC income. Add in lawyers, restaurants, etc., you probably get closer to 30-40% indirect.

And that revenue stream has just been cut in HALF, and will not be bouncing given that the entire industry is shifting to a less leveraged one. And much of the already created wealth went down in restricted stock that is now worthless.

If you somehow think that the impact on NYC real estate is just coming from "the recession", then you don't seem to understand the industry that you work in.

Of course, I don't take real estate market advice from brokers, either, so this is no surprise.

> Finally, nowhere did I suggest that RE in NYC wouldn't go down, in fact I said that it would.
> I am simply proposing a more moderate view of the situation and everything you are saying is so
> extreme that even moderate statements are being called out for being naive and that is quite
> disapointing.

I think your problem is you don't get all the information, just the info you want.

My position is NOT extreme. My predictions for this market are in the middle of where the folks on this board are on. Your statements are NOT moderate. Given that we're not full blown in a recession and market crash, calling for break evens in a few years is pretty darn extreme.

Don't hold yourself out as the voice of reason. You are the voice of unrealistic illogical wishful thinking.

The decline is in. Is it the end of the world? No. But just as saying RE will go down 97% is ridiculous, so is denying the impact of the trends that have ALREADY HIT.

That *is* naive."

But can you live in webvan.com?

NYC - First of all, I think that we are actually saying some of the same things. I just didn't communicate them well, as I was trying to work and type here (never a good idea). I have no power to make the economy better. Do I have a vested interest in a better economy? Sure do...we all do. But, I didn't just show up to the party and have been through these things before. I can say with confidence that the jobs situation is going to be extremely challenging...to say the least. On a national level, I think that we should hope to keep the unemployment number under 8% and the first quarter of next year will probably let us know if that's possible. If it goes much higher, say into the 9-10% range things are going to be a lot worse for a whole lot longer. That said, let me see if I can make more sense about what I was thinking earlier.

Since NYC is FS-driven, when that industry gets hit it reverg=berates to other businesses that depend on them for survival (restaurants, catering, high-end jewelry/electronics, travel, etc.). This is one point we agree on and I mangled what I was trying to communicate. The FS industry is hurt and is going to continue to be hurt throughout next year, which will affect all of the other businesses as well. The good news is that when the FS industry recovers these other businesses share in the growth as well. There is a lot at stake for the banks and investment to contain the damage and recover. Despite what you have been reading most of the larger firms started to slow their hiring about 14 months ago, so as they have lost headcount in 2008 they have not replaced them. Some of these jobs will not come back and other cuts will surely come. Also, remember that natural attrition is around 8-10%, but in some areas of these firms it is closer to 20-25%. When a firm plans to cut 10% of their staff, they cut and then hire in other areas or they will be too short. In 2001/2002 there was much less of a "warning" and firms were caught with a lot more headcount in many areas than they have right now.

Tourism is a boon for NYC. Certainly with the economy down globally this is an additional strain on the NYC economy, but this too will come back. I am not suggesting it will be all roses in 6 months, but NYC is still going to be a destination for domestic and foreign travelers and when the economy improves this is an additional boost that NYC will receive. Obviously, we are going to be putting up huge debt numbers before this occurs, but at least we have that potential down the road. Most cities don't have that as a possibility.

The FS industry is clearly going to contract and change. The business will be different, but that doesn't mean that these firms are not going to make money. They will have to adjust and I believe that they will be able to do that. We will need more time to see how the regulatory changes that come impact the industry and how the firms adapt to the new world we are now in, but the FS industry is not dead (okay, insert joke here).

Finally, NYC, I think that you make a lot of good points and are someone who is quite knowledgeable.

I do believe that there are going to be some surprises that come at us in this recession that no one has even mentioned. Some will make it more challenging and some may even help us recover quicker. I am confident that it will be different than other recessions, though, because all of the major recessions have had their own unique wrinkles.

I guess I just think you are mistaken about how things "come back".

You seem to get that jobs will be cut and tourism fall off a cliff, but you seem to have this idea that it bounces. It doesn't. 2001 was an anomoly because a second bubble started.

But, having lived through multiple real recessions here, let me just say that isn't how it works. if you think its "well, we have to lay off some, but we'll hire them back in 2 years and it will be peachy" then you just don't get how deep recessions work. And you just don't get what a bubble is.

I take it you have only lived here a few years.

Also, if you think that Wall Street gets back ANYWHERE near where it was, I don't think you actually understand what has happened here. We are talking about permanently lower leverage ratios, meaning permanently lower profits, and permanently lower bonuses.

30% of NYC income just got cut in half. And its not coming back to previous levels.
If you think that just means a temporary "correction" in RE, you aren't getting it. We are talking about fundamental changes in this city. After a time of UNPRECEDENTED wealth. We don't need calamity to see huge declines, we just need a return to "normal" to see that. That seems to be the biggest point you are missing. 2007 prices in 2010 isn't moderate. It is RIDICULOUS. That is expecting pets.com to be back at $100.

There just seems to be a misunderstanding here about what happens after a bubble. "Normal" isn't back to bubble prices, its back to PRE bubble prices.

Ali,

I'm a bit confused at your rejection of these comps out of hand. Your response to my first comp is just inaccurate. The 1900 sq ft apartment DID sell, for 3.65 million, whereas the 2100 sq foot nearly identical apartment across the street languished and is now on the market for 2400. Tribeca would not impact one of these apartments more than the other. But honestly, it seems like you don't want to believe that prices are declining as much as they are, so you are going to look at the evidence in the most favorable light you can. I owned for four years, so I remember what it's like to have so much vested in the market staying strong. But if you are just going to deny the evidence, then not much more to talk about.

Take a look:

front_porch,

obviously i can't show you any closings 30-40% off comps since it takes three or more months for apartments to close. i can show you apartments that are ASKING 30-40% off of comps--and still haven't sold. That should be just as good (if not better), right?

I looked at this apartment last Winter. It is approximately 1900 square feet, nice but not spectacular views, and needed a serious renovation:
http://www.streeteasy.com/nyc/sale/135975-coop-33-fifth-avenue-greenwich-village-new-york
It went on the market last October for 3.75 million.

Based on this comp, a 2100 sq foot apartment right across the street, in an equally coveted gold coast building, 16th floor, also with a decent but not spectacular view, and also requiring a significant renovation, went on the market a few months later asking an identical 3.75 million.
http://www.streeteasy.com/nyc/sale/345766-coop-30-fifth-avenue-greenwich-village-new-york

The first apartment needed slightly less work, perhaps, and had slightly better view. The second apartment was larger, but both me and my broker thought they were about equal, and about equally overpriced.

The first apartment sold for 3.65 million last April:
04/11/2008 #15-AB $3,650,000 -3.8% $3,795,000 3 beds 2 baths

The second apartment is still on the market, and after various reductions and a change of broker, it now asks $2.4 million, and it still hasn't sold.

That is 34% off the SALE price of the comparable unit (slighly more off the original ask, but that's not important). And it still hasn't sold. I'm considering offering $1.8 for it, just to see how desperate they are, but really, I think things are so bad in NYC real estate right now that prices could come down even a lot more than that.

Peachy? Not so much....but an economy that can grow moderately and consistently with less risk? That seems attainable. How the banks and investment firms change and adapt their businesses will tell us a lot about how things shake out in the future.

There was investment banking business by bank holding companies before August and those firms made quite a bit of money (Citigroup, JPMorganchase, etc). They will not operate at 40X leverage, but they will also not operate like savings banks either. The firms will hire people back. It is a misconception that everyone at these firms makes $600k a year. There has been a tremendous loss of wealth and I am not sure what "normal" will be like in 2010, but I don't think it is a return to 1995 prices.

There is a lot to unfold still and it is some of this "unknown" that will really determine how deep this is going to be and how long it will take to recover. Also, much of the obscene bonus money went to a very small percentage of bank employees. Perhaps the near-future of RE in NYC is more of a flattened picture, with the difference between a 2BR/1BA and a 2BR/2BA with a terrace being 10% instead of 35%...I am just making that up to give some sort of example. There has seemed to be a large discrepancy between the slight up-ticks in quality/size of apartments. Maybe this flattens out in the futre...just a thought.

Side note fwiw...I am hearing that a lot of the BofA people could be moved out in favor of the ML people when Thain takes over the wealth management business.

do you find that the new developments are declining as rapidly as older apts? seems that developers are either burrying their heads in the sand or are just unwilling to acknowledge the change in the market conditions.

> Peachy? Not so much....but an economy that can grow moderately and consistently with less risk? That
> seems attainable.

Sure, but a more solid economy won't mean much if the Wall Street empire is dead as we know it. It will help housing values in peoria, but it won't sustain 2007 prices.

> There has been a tremendous loss of wealth and I am not sure what "normal" will be like in 2010, but
> I don't think it is a return to 1995 prices.

You don't need 1995 prices for a 30% decline... or a 40% decline... or even a 50% decline.

> There is a lot to unfold still and it is some of this "unknown" that will really determine how deep
> this is going to be and how long it will take to recover. Also, much of the obscene bonus money
> went to a very small percentage of bank employees.

Uh.... wishful thinking, but no.

WS is the place of the glorified middle manager making 7 figures (or was). It isn't the MDs moving the market, its the middle suckers who won't be able to justify $500k salaries anymore

Nice try, but no.

> Perhaps the near-future of RE in NYC is more of a flattened picture, with the difference between a
> 2BR/1BA and a 2BR/2BA with a terrace being 10% instead of 35%...

Perhaps the dot com bust would only be 25% losses.

BTW, not sure you noted on the other thread... a prime park avenue co-op is listed for 25% less than the 2007 price...

I'm not quite sure you are grasping reality here. Yes, there is more to unfold, but the era has already officially ended. Pretending we'll be back there in a couple years is insane.

Back to the bigger point... many folks, particularly recent transplants in NYC, just don't get what "normal" RE markets look like. They think a 15% decline is back to "normal".

I think a lot of folks are in for some SHOCKING realizations. Not saying we're all going to explode. But 15% off the bubble of all bubbles isn't a pop, thats just the "hiss..."

http://www.streeteasy.com/nyc/talk/discussion/5999-crumbling-on-park-avenue

Minimum 25% loss on prime park avenue (80s) bought in 2007....

Is that "steep" enough for you yet?

nyc10022: I think the 2007 sale was a different apartment, but don't let details stop a good rant. :o)

"I'm not quite sure you are grasping reality here. Yes, there is more to unfold, but the era has already officially ended. Pretending we'll be back there in a couple years is insane.

Back to the bigger point... many folks, particularly recent transplants in NYC, just don't get what "normal" RE markets look like. They think a 15% decline is back to "normal".

I think a lot of folks are in for some SHOCKING realizations."

This is all a bit holier-than-thou, don't you think? Yes, the signs point to some of the predictions you're making, but we're still dealing in conjecture here. Because waverly doesn't see things you're way, he's a "recent transplant"? Poor form, mate.

happyrenter, is your argument that nearly all apts will come down at least 40%, or that only a few select units will? Those are different things, of course, and it's not too difficult to find a couple outliers, even in rosier times.

NYC - you are taking liberties with what I said. A stable, growing economy is what I mentioned...never said anything about 2007 prices.

I agree that there will be declines and I think something in the 30-35% range would be my bet at this point.

You have no idea how few people in banks make $1 million+ in cash.

"Perhaps the dot com bust would only be 25% losses." I have no idea what you are saying here? I simply gave an example of a potential scenario after the prices had hit bottom of what some of the differentials could look like. You take that as me saying a 25% drop from 2007 prices...whatever.

"Is that "steep" enough for you yet?" - now you're just being a bit of a d-bag because someone won;t agree with everything you've said.

Here's an update for you....you don't know everything, so maybe dial-down the attitude a bit, huh?

> This is all a bit holier-than-thou, don't you think?

bjw, this really coming from you of all people?

;-)

> You have no idea how few people in banks make $1 million+ in cash.

Did I *say* cash? Check the threads, and you'll see that I've talked about the portion of compensation in stock more than anyone.

And, I absolutely have a great idea about how many make what... but thanks for asking.

In the end, Wall Street buyers drive 30% of Manhattan sales. Call it concentrated all you want, its that same concentrated bunch who drove it up, and who just got whacked.

> Here's an update for you....you don't know everything, so maybe dial-down the attitude a bit, huh?

Here is an update for you... you haven't brought any data, or facts to the discussion, only blanket statements. And then you accuse others of making only blanket statements.

When you've got something useful to add to the discussion, let me know... otherwise, you are the one who needs to check yourself.

> Because waverly doesn't see things you're way, he's a "recent transplant"? Poor form, mate.

If "the way" is fairly common knowledge to folks who have lived in NYC over the period in question..... absolutely. There is no way someone could hold the specific views in question if they actually had the relevant experience.

Yes, nyc10022, it's cause your attitude kind of sucks. ;-) waverly's presented data and facts (as you have); sorry you didn't care to read much of it.

"If "the way" is fairly common knowledge to folks who have lived in NYC over the period in question..... absolutely. There is no way someone could hold the specific views in question if they actually had the relevant experience."

Don't confuse your opinions with "fairly common knowledge to folks who have lived in NYC over the period in question." It's a big, diverse city, with a whole lot of varying opinions and experiences. That is extremely short-sighted, and dare I say, very un-NYC of you.

I'll add that you're behaving like a knucklehead, but that's probably pretty clear to everyone.

Since this is a discussion about what will happen in the future, I am not so sure that you have brought any hard evidence to the table other than saying "This is what is going to happen."

You are right that WS is 30% of the market for RE in NYC. You are wrong when you assume that means that everyone on WS is now out of the picture for buying an apartment in NYC. What degree is out? Guess what...you have no idea.

WS is not dead and just to be sure I called and they are still answering the phones and everything. Their business has been hurt and they need to adapt. How they adapt will tell us a lot about where the industry goes. That is a much more sound statement than WS is dead.

Look, you are either open to an exchange of ideas to increase awareness and knowledge or you just want to shout out extreme statements and yell at anyone who disagrees with what you say. We obviously feel differently about what SE is for....that's cool.

bjw - thanks.

BJW, don't be a hypocrite. There are few as "high and mighty" as you on this board... and you have absolutely taken on nasty tones at times (remember that thread from a couple days ago).

And, yes, lots of folks who weren't here don't know. I believe you are one of those. I'm sorry if that offends you, but its a bit crazy to take advice from folks who don't have the facts.

> It's a big, diverse city, with a whole lot of varying opinions and experiences

If you think what happened in '87-89 is a matter of "opinion", why, then, I think we found your problem!

Yes, people have different opinions. But opinions on matters one knows nothing about.... sorry, you can keep those. You and the other transplant can have each other.

I love it... transplants have never seen a RE crash in NYC, so they don't exist.

Ignorance is bliss, I guess...

> waverrly's presented data and facts

We're also playing with an extremely loose interpretation of "facts" here.

But, I guess coming from folks who think whether or not the 80s happened is opinion...

> I'll add that you're behaving like a knucklehead
Yes, hopefully I can behave more "normally" and make blanket statements with no validity and then try and rail on others for doing so.

"You are right that WS is 30% of the market for RE in NYC. You are wrong when you assume that means that everyone on WS is now out of the picture for buying an apartment in NYC."

Now you are just lying. I didn't say that at all. In fact, genius, you keep missing the part where I talk about determination of illiquid markets at the margins.

Stop the game playing, you have no data or facts. If all you have is lying, just shut up.

"Look, you are either open to an exchange of ideas to increase awareness and knowledge or you just want to shout out extreme statements and yell at anyone who disagrees with what you say."

"Opinions" from folks with nothing but a vested interest in a certain answer have no value. Those same opnions allowed the bubble to happen, and for waaaay too many people to miss it. They had no value before, they have no value now.

You aren't exchanging information, you are basically just spewing propaganda.

Don't confuse that for honest debate. That would include facts, logic, data, all the things you lack.

If you read earlier posts from nyc10022, its clear what his agenda is. He said he wants to buy, but wants to wait for prices to come down first. He said later that he believes "a few crazies" on the streeteasy boards can change the market, since a few people at the margins move markets. It isn't such a huge leap of logic to conclude that he feels his work here on the boards will directly impact his future purchase price.

I give him that he's smart (unlike, for example, petrfitz). He just has an agenda, refuses to acknowledge any evidence to the contrary, and worse, twists facts to support his agenda.

I've lived & worked here for 15 years, but keep making assumptions on things.

This recession will be different from other deep recessions. They each have their own differences and if you can't see that, then you can continue to be ignorant.

nyc, don't appreciate the putting words in my mouth. I don't think I've ever been "nasty" here. And just because you say someone "doesn't have the facts" doesn't make it so. That's code for "you don't agree with me." Where did I make any mention of 87-89? In relation to what exactly? And what makes me a transplant? And what are you? When have I ever said a RE crash in NYC doesn't "exist"? You're generally a pretty smart guy with legitimately interesting takes on RE and the economy, but as waverly said, you're acting like a big dunderhead. It doesn't suit you.

Yes, some day I hope to have no agenda, like those of you who bought and think they can keep the market up by talking and posting and following me around. You guys know who you are.

Despite tech guy's lying, I know that nothing I can say will change the market. The die is cast. It was cast months ago. Now we just have to see where it lands.

But you folks can post till your fingers fall off, its not going to prop the market up. Put as many "opinions" you want together, a bunch of recent transplants who are shitting that the market might go down are not going to be adding value to any discussion. But, I'm sure you won't let that stop you from posting.

> It isn't such a huge leap of logic to conclude that he feels his work here on the boards will
> directly impact his future purchase price.

Right, not a big leap from one lie to another...

Keep posting tech, your condo will double in price.

> I've lived & worked here for 15 years, but keep making assumptions on things.

And, as I said, you missed the 80s. I was right!

> This recession will be different from other deep recessions. They each have their own differences
> and if you can't see that, then you can continue to be ignorant.

And water is liquid! No duh.

Yes, there will be differences between recessions. But to use that as an excuse for ignorance is ridiculous. The specifics of each time period don't change the fundamentals of how markets work.

In defense of NYC10022 I don't think he is saying a few crazies on street easy can change the market. I think the point is that people on the margins - people who buy or sell because of their perception of where the market is going or because they got paid a lot one year - determine the prices. the people who need to buy or need to sell for various life reasons (job, kids, marriage/divorce) are a constant presence and don't move the market. i agree with this and think this is *especially* true in NYC since there are, in my opinion, ALWAYS more people who MUST sell than MUST buy. In NYC - more so, than say, suburban DC - there are always attractive rental options. therefore, there is always somewhat of a constant number of sellers on the market, but a decrease in the number of people who say "must buy now or get priced out" or "want to buy something now to plunk my big bonus into" - even if this is not the majority of the buyers - makes the difference.

Yikes, nyc - that is such a ridiculously huge leap of an assumption, and quite the spin. Honestly, I don't care all that much about the market and as far as I know, not one of us here has said the market won't go down.

> nyc, don't appreciate the putting words in my mouth. I don't think I've ever been "nasty" here.

We'll have to agree to disagree then...and, if I remember correctly, the last time I called you out a couple days ago, you did exactly what you are accusing me of.

> And just because you say someone "doesn't have the facts" doesn't make it so.

True... them just not having the facts makes it so.

> That's code for "you don't agree with me."

You seem to be confusing facts and opinions. If there are facts, and one's opinions contradict them, then they don't have the facts.

> Where did I make any mention of 87-89?

I didn't say you said 87-89...

> And what makes me a transplant?

You weren't here. Then you were here. Pretty simple to me.

> And what are you?

Not a transplant.

> When have I ever said a RE crash in NYC doesn't "exist"?

Just responding to your ludicrous assumption that facts/history don't matter because people have "diverse opinions".

You were excusing ignorance of history, and I responded to that.

> You're generally a pretty smart guy with legitimately interesting takes on RE and the economy, but
> as waverly said, you're acting like a big dunderhead. It doesn't suit you.

OK, hall monitor.

I just see some folks with vested interest in a market not tanking, and a VERY loose interpretation of "facts". The agendas are pretty clear here... but its a bit hypocritical to try and call me out.

> In defense of NYC10022 I don't think he is saying a few crazies on street easy can change the market.

Don't worry about it, techguy has a specific agenda, and part of it is admittedly trolling... and its actually a lie he's tried to tell. Its not a misinterpretation, its a lie.

"I think the point is that people on the margins - people who buy or sell because of their perception of where the market is going or because they got paid a lot one year - determine the prices. the people who need to buy or need to sell for various life reasons (job, kids, marriage/divorce) are a constant presence and don't move the market."

Bingo.

> i agree with this and think this is *especially* true in NYC since there are, in my opinion, ALWAYS
> more people who MUST sell than MUST buy. In NYC - more so, than say, suburban DC - there are always
> attractive rental options. therefore, there is always somewhat of a constant number of sellers on
> the market, but a decrease in the number of people who say "must buy now or get priced out" or "want
> to buy something now to plunk my big bonus into" - even if this is not the majority of the buyers -
> makes the difference.

well said...

nyc, very flip answers. By your definition, everyone is a transplant.

"Just responding to your ludicrous assumption that facts/history don't matter because people have "diverse opinions"."

You inferred very incorrectly. I never assumed that.

"I just see some folks with vested interest in a market not tanking, and a VERY loose interpretation of "facts". The agendas are pretty clear here... but its a bit hypocritical to try and call me out."

Now, THIS is based on nothing! Well done.

the ironic thing is that neither techmonkey, bjw, or waverly are debating anything but my "style" and "attitude".

The interesting thing is, there hasn't been any conflicting actual evidence produced.

The agenda seem pretty clear to me... "if you have facts on your side, argue the facts... if you have law on your side, argue the law... if you have neither the facts nor the law on your side, just bang on the table".

Talk about my style and attitude all you want, it won't change the market.

> nyc, very flip answers. By your definition, everyone is a transplant.

No, and please stop putting words in my mouth already.
If you don't understand the sentence, ask for help.

But that is not what I said...

> > Just responding to your ludicrous assumption that facts/history don't matter because people
> > have "diverse opinions"."
> You inferred very incorrectly. I never assumed that.

You are right, I didn't infer correctly. I didn't have to... you just said it directly. Worse than I thought then...

"It's a big, diverse city, with a whole lot of varying opinions and experiences. " which was in direct response to me talking about knowledge of the crash in the 80s....

> "I just see some folks with vested interest in a market not tanking, and a VERY loose interpretation > of "facts". The agendas are pretty clear here... but its a bit hypocritical to try and call me out."
> Now, THIS is based on nothing! Well done.

You are one step up from "I know you are but what am I".

Well done.

"The interesting thing is, there hasn't been any conflicting actual evidence produced."

What are you even debating at this point? That the market is coming down? I agree. That pricing is determined at the margins? Agree with that as well. But the moment someone challenges any of the details of your vociferous output here, you explode and act as if we're the yin to your yang.

Vested interest? We all have a vested interest in the economy recovering. My interest in NYC RE being overvalued is nil.

I wasn't around for the 1860's either, but I sure as s*** can tell you about the civil war, why it occurred and what the ramification of it were.

You lived through the 80's...uh, so what...so did I.

The fringes determine the price...I get it and I agree. That is an excellent point that you make, but that cuts both ways. If you have a market of people who aren't forced to sell their apartments they can wait out for that 1 fringe buyer who will give them an offer they will accept. They will ignore the comps of the fringe buyer who bought way "below-market" (not the best term, sorry) because they can afford to turn down offers and wait. You only want to see the fringe buyers on the way down. I think that good apartments in good neighborhoods will be bought when the prices decline to a more reasonable number and this will again move prices upward, just much slower than before. I do not think you are going to buy a 2 BR/2BA in GV for $500 sq ft. The fringe buyers won't let that happen.

"> And what makes me a transplant?

You weren't here. Then you were here. Pretty simple to me.

> And what are you?

Not a transplant."

How exactly do you know this? My family has owned RE is this city for nearly 40 years.

bjw, you are being rational...

What started this was someone who didn't get the second point... and then kept arguing around it over and over again without any understanding of it.

Then, ironically, jump in from a guy who REALLY didn't understand the second point.

If folks differ on the details, fine, all good, let it out. But waverly is hours after the fact coming up with lines like " You are wrong when you assume that means that everyone on WS is now out of the picture for buying an apartment in NYC"

You're jumping in late on this (not the first time), but its the initial stuff that got challenged, not the details.

If you have 2 cents on salary movements or whatever, cool. But we're talking about nonsensical arguments here.

Additionally, I thoroughly belive the market will decline. Pieces of crap in bad neighborhoods that are overpriced should sit around for a very long time. There are a ton of grossly overpriced properties that need to come down a lot.

I just don't agree with everything you have said.

nyc, "jumping in late" happens in message boards. I'm not going to start a new thread every time I want to post an answer.

I'm not talking about a comment, I'm talking about jumping into a conversation you missed the beginning of, taking certain comments out of context... like in this case. We admittedly agree to the major points here, and you missed that one of them was being challenged.

When you go for personal attacks, you are especially vulnerable to this.

"Additionally, I thoroughly belive the market will decline. Pieces of crap in bad neighborhoods that are overpriced should sit around for a very long time. There are a ton of grossly overpriced properties that need to come down a lot."

This just sounds like more of that "well, CRAPPY apartments in CRAPPY neighborhoods will have trouble, but prime [defined as wherever the poster bought] will be fine" stuff we heard for months. That zone got smaller and smaller.

Zillow did a national survey where 75% of folks thought their houses had gone up or stayed the same... where their analysis showed that 90% or such had decline. Even funnier, the majority noted that their *neighbor's* houses might have gone down, but not their own.

Denial is a powerful thing.

So, no, we don't agree at all here. This isn't a "some apartments are overpriced" thing, where YOUR apartment is safe. We're talking about a pretty universal reset of prices closer to actual economic principles (and likely a short-term overshoot to the downside).

Exact quote: "I think that it fairly accurate, but back to my "margins" comment. You only need a few streeteasy crazies to start the descent down, and once that happens, its a snowball rolling downhill.."

http://www.streeteasy.com/nyc/talk/discussion/5620-the-internets-ability-to-accelerate-price-correction

"Yes, some day I hope to have no agenda, like those of you who bought and think they can keep the market up by talking and posting and following me around. You guys know who you are."

Wow, quite the egomaniac. I guess I shouldn't expect any less from someone who believes he can move markets.

Tech guy, you have to stop telling the same lie over and over again. Your mom knows what you've been doing.

For the literate folks who didn't just lose all their allowance money on their outer borough condo..

FROM THE SAME THREAD...

TechMonkey:

> > You actually think you can affect the market here?

Me:

> No, please read more carefully.

> I'm talking about the 70,000 folks who ready streeteasy each month. 4 million page views.

> Great if you think I can move the market, but I'm talking about a big chunk of the 70k who are
> getting good data off the site.... or, any of the others like it (propertyshark, etc.).

Techmonkey, why compound your bad real estate "investment" with lying and trolling?

> Techmonkey, why compound your bad real estate "investment" with lying and trolling?

Oh wait, I forgot... already answered that.

You actually believe that you can keep up the value my posting enough. I forgot.

The best you can come up with is "I know you are but what am I"?? I post links to the crap you spew so the readers can judge for themselves in full context. You just put incorrect lies in peoples mouths.

(now doing the slam dunk dance)

TechMonkey, if you want to troll - as you admit you like doing - go find perfitz.