After the financial markets imploded, the New York real estate market "stopped dead," said Dottie Herman, CEO of broker Prudential Douglas Elliman. "If you think you're going to lose your job, you're not going to buy. [We're] a long way off from the past couple of years." WOW! Honesty from Dottie! And the city's economic conditions are only getting worse. On Friday, New York City Mayor Michael... [more]
After the financial markets imploded, the New York real estate market "stopped dead," said Dottie Herman, CEO of broker Prudential Douglas Elliman. "If you think you're going to lose your job, you're not going to buy. [We're] a long way off from the past couple of years."
WOW! Honesty from Dottie!
And the city's economic conditions are only getting worse. On Friday, New York City Mayor Michael Bloomberg announced $1 billion worth of budget cuts as Gotham steels itself against a rapidly dwindling tax base. Its coffers are expected to dwindle by a stunning $4.1 billion for fiscal 2009, which ends June 30, thanks to the economic turmoil.
Perhaps it's no surprise then that Goldman Sachs recently issued a report predicting that New York City's normally-stratospheric prices will fall as much as 44%.
http://money.cnn.com/2009/01/30/real_estate/New_York_next_bust/index.htm?postversion=2009013016[less]
Response by julia
over 17 years ago
Posts: 2841
Member since: Feb 2007
44%...if that happens I can see a one bedroom.
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Response by projects_suck
over 17 years ago
Posts: 72
Member since: Jan 2009
keep dreamin'
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Response by kingdeka
over 17 years ago
Posts: 230
Member since: Dec 2008
I started to get excited about the post until I read the article. It didn't shed anything new and just recycled news that has been going on since September. I am more interested in the report by Goldman Sachs that tne New York area price may fall as much as 44%. Anyone have a real link to that article?
Was very conflicting because Case-Shiller said NY area prices will fall 21% over the next 4 years, when we have already seen 25% reductions.
Very interested in the cited Goldman Sachs study that prices may fall 44%. Where is that link?
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Response by flmd
over 17 years ago
Posts: 223
Member since: Feb 2008
the Goldman reports states that manhattan income from 1999 - 2007 rose to 3x the national income. Prior to that rise manhattan income was 2x national income. If income in Manhattan fell to 2x then it would imply that NY real estate could fall as much as 44%
a 1 br going for $800,000 would sell at $480,000
he qualified the report by saying if NY standard of living stayed high (no crime) then prices would not go that far down
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Response by nyc10022
over 17 years ago
Posts: 9868
Member since: Aug 2008
> Was very conflicting because Case-Shiller said NY area prices will fall 21% over the next 4 years,
> when we have already seen 25% reductions.
A 25% AND A 21% decline is a 41% decline. So what exactly do you think is wrong with the stat?
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Response by InvestorMan
over 17 years ago
Posts: 135
Member since: May 2008
That's a big "if" when talking about standard of living when the city is in that much of a deficit and services are being cut like a fat kid from the soccer team.
Denial is still high and I think it'll take the next catalyst (who's got ideas? bankrupt automaker, another bank failure, a bank "holiday," etc.?) to really get the reality to everyone.
If prices fell 60% in the early 90's from where they were in the 80s and, well, the highest salary industry and the world economy, weren't failing, then I'm finding it hard to believe we won't see something very similar.
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Response by ruff
over 17 years ago
Posts: 118
Member since: Nov 2008
That report was a joke. Even they (Goldman) admitted at best they were just guessing. No solid conclusions.
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Response by w67thstreet
over 17 years ago
Posts: 9003
Member since: Dec 2008
Investorman... mmmmm... violence erupts in middle east, Obama euphoria dies down, TARP 3.0 enacted, GM bankrupt, 12% unemployment, LT interest rates spike (no matter what Geitner does), China unrest, North Korea sabre rattles, Russia spirals into complete economic chaos (Putin re-takes command), and Dottie admits fake boobs do not help in marketing RE....
Prime, baby prime NYCRE for under $500psf.... :)
I just hope my bomb shelter is ready by then.....
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Response by ruff
over 17 years ago
Posts: 118
Member since: Nov 2008
You may just need it, along with the wheel barrel it will take to carry all those Dollars in to get a loaf of bread.
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Response by nyc10022
over 17 years ago
Posts: 9868
Member since: Aug 2008
"Denial is still high and I think it'll take the next catalyst (who's got ideas? bankrupt automaker, another bank failure, a bank "holiday," etc.?) to really get the reality to everyone."
nah, I think its just the stats coming out. We don't need more catalysts, we just need the actuals out.
When the closing numbers showing the 20% declines are in, I don't think much more denial will be possible.
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Response by InvestorMan
over 17 years ago
Posts: 135
Member since: May 2008
One would think any of the things you guys mentioned would do the trick, but this pig is keeping it's lipstick on. It just seems like the excuse for us not plunging through or, at least, retesting lows is because the market already has "everything discounted."
I guess I'm also on the impatient side...mostly because I've got a nice line of UltraShorts waiting to pay for my upcoming vacation, my (hopefully) new rental digs in Manhattan, and add to my "Manhattan Old Law Tenement Rental Downpayment Fund." :-P
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Response by flmd
over 17 years ago
Posts: 223
Member since: Feb 2008
ruff: huh? no where in the report did they say they were guessing...based on any statistical measure u want to rent; rent/own, price/income etc manhattan real estate is overpriced
they only place they hedged was quality of life and population growth (it was a very small hedge) I actually read the report
44%...if that happens I can see a one bedroom.
keep dreamin'
I started to get excited about the post until I read the article. It didn't shed anything new and just recycled news that has been going on since September. I am more interested in the report by Goldman Sachs that tne New York area price may fall as much as 44%. Anyone have a real link to that article?
Was very conflicting because Case-Shiller said NY area prices will fall 21% over the next 4 years, when we have already seen 25% reductions.
Very interested in the cited Goldman Sachs study that prices may fall 44%. Where is that link?
the Goldman reports states that manhattan income from 1999 - 2007 rose to 3x the national income. Prior to that rise manhattan income was 2x national income. If income in Manhattan fell to 2x then it would imply that NY real estate could fall as much as 44%
a 1 br going for $800,000 would sell at $480,000
he qualified the report by saying if NY standard of living stayed high (no crime) then prices would not go that far down
> Was very conflicting because Case-Shiller said NY area prices will fall 21% over the next 4 years,
> when we have already seen 25% reductions.
A 25% AND A 21% decline is a 41% decline. So what exactly do you think is wrong with the stat?
That's a big "if" when talking about standard of living when the city is in that much of a deficit and services are being cut like a fat kid from the soccer team.
Denial is still high and I think it'll take the next catalyst (who's got ideas? bankrupt automaker, another bank failure, a bank "holiday," etc.?) to really get the reality to everyone.
If prices fell 60% in the early 90's from where they were in the 80s and, well, the highest salary industry and the world economy, weren't failing, then I'm finding it hard to believe we won't see something very similar.
That report was a joke. Even they (Goldman) admitted at best they were just guessing. No solid conclusions.
Investorman... mmmmm... violence erupts in middle east, Obama euphoria dies down, TARP 3.0 enacted, GM bankrupt, 12% unemployment, LT interest rates spike (no matter what Geitner does), China unrest, North Korea sabre rattles, Russia spirals into complete economic chaos (Putin re-takes command), and Dottie admits fake boobs do not help in marketing RE....
Prime, baby prime NYCRE for under $500psf.... :)
I just hope my bomb shelter is ready by then.....
You may just need it, along with the wheel barrel it will take to carry all those Dollars in to get a loaf of bread.
"Denial is still high and I think it'll take the next catalyst (who's got ideas? bankrupt automaker, another bank failure, a bank "holiday," etc.?) to really get the reality to everyone."
nah, I think its just the stats coming out. We don't need more catalysts, we just need the actuals out.
When the closing numbers showing the 20% declines are in, I don't think much more denial will be possible.
One would think any of the things you guys mentioned would do the trick, but this pig is keeping it's lipstick on. It just seems like the excuse for us not plunging through or, at least, retesting lows is because the market already has "everything discounted."
I guess I'm also on the impatient side...mostly because I've got a nice line of UltraShorts waiting to pay for my upcoming vacation, my (hopefully) new rental digs in Manhattan, and add to my "Manhattan Old Law Tenement Rental Downpayment Fund." :-P
ruff: huh? no where in the report did they say they were guessing...based on any statistical measure u want to rent; rent/own, price/income etc manhattan real estate is overpriced
they only place they hedged was quality of life and population growth (it was a very small hedge) I actually read the report
we'll see if they're right