A Bearish Sign on N.Y. Home Prices - December 27, 2007 - The New York Sun
A Bearish Sign on N.Y. Home Prices - December 27, 2007 - The New York Sun:
New York City's status as a rosy exception to the nation's slowing housing market may be starting to come to an end.Right now, most residents of NYC think that they are immune to the housing
Some real estate analysts say that despite the country's overall slowdown, Manhattan apartment prices will maintain an upward trajectory in the fourth quarter. "Our fourth quarter report is coming out next week and we expect price growth will continue," the chief economist at Halstead Property, Gregory Heym, said. "Several new condo developments are starting to close, such as the Plaza and 15 Central Park West, which will help push up prices."I guess in a few years Manhattan is going to consist of nothing but Wall Street executives living amongst a bunch of empty foreign owned apartments that are only used a couple of weekends a year.
In addition to apartment closings at new developments, where prices are often high, there are many larger units that are also closing, Mr. Heym said. Despite the market turmoil, Wall Street bonuses at many firms are expected to be solid, and with a weak dollar, foreign buyers continue to flock to Manhattan.
4 comments:
Well, you can't really use Manhattan (or San Francisco) as any kind of indicator. Both are geographically restricted areas that can't expand, so as more people move in, demand goes up. That's the primary reason housing is so idiotically expensive (comparatively) in both cities.
"That's the primary reason housing is so idiotically expensive (comparatively) in both cities."
I would disagree with that. The population of Manahttan has fluxuated wildly for the last 100 years and currently has less people than it did in 1960. San Francisco has actually had a population decline of 4.2% between 2000 and 2006.
More people were bidding up the prices, but not because of housng demand, but because of a perception of they are highly desireable places and because of the mistaken belief that "prices always go up".
http://en.wikipedia.org/wiki/Manhattan#Demographics
http://quickfacts.census.gov/qfd/states/06/06075.html
Up and down or not, both are over populated areas with inflated demands.
>>More people were bidding up the prices, but not because of housng demand, but because of a perception of they are highly desireable places and because of the mistaken belief that "prices always go up".<<<
Well, there was a bad spell in the 70s and 80s, but once crime started going down, prices in Manhattan have been going up up up. And the long term track record is astounding - something like 700% in 50 years.
Taking the metro area as a whole, close to 10% of the country lives here. We have the longest commutes in the country. Prices are high even 50 miles away here - and that is a long trip to the office.
And the key to it all is the job market. There are more six figure jobs here than anywhere. Once you have specialized expertise that's worth top dollar here, you can't really sell it anywhere else. And you're stuck. True, housing costs more but - if you can afford to buy - a big if given the high rental rate in NYC - at some point that becomes a fixed cost.
The part I don't understand is why the average earners - the teachers and nurses and police officers - don't all move away tomorrow. Their quality of life would instantly improve - nicer house, shorter commute, probably less stress overall. Yes, crime is now very low here - see excerpt below - but I think the risk of terrorism plus crime plus crime going back up makes it less rosy than a simple extrapolation from the recent past.
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Low Murder Rate Brings New York Back to ’63
by THOMAS J. LUECK
Published: December 31, 2007
It was a year of trauma for the nation, and of foreboding for New York City. In 1963, the year that John F. Kennedy was assassinated in Dallas, New Yorkers were feeling strains in the urban fabric: Affluent families fled to the suburbs, job losses mounted among old-line manufacturers, and 548 people were killed.
As 2007 draws to a close, it seems very likely that there will be fewer than 500 killings in the city (as of Sunday evening, there had been 492) for the first time since reliable records started being kept.
That was 1963.
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