Expats not happy, why stay?

[gouchobob]

I'm going to assume you have never bought in NYC - specifically Manhattan? The vast majority of buildings there are co-ops. And in the vast majority of co-ops, you not only have to put down 20/25% of the asking price in cash, you have to have another 20/25% of the asking price in liquid assets. Plus present financial records, reference letters, employment verifications, history of financial stability, etc to the co-op board in order to be approved A bank may not have asked questions but you can bet most co-op boards ask a lot!

And FWIW - prices did drop in Manhattan and the entire city. And there were more apts available. That has changed again and prices are on their way up. I highly doubt NYC will ever go through a real drop in prices.

And what this has to do with BsAs - I will never know!

People can believe what they want to. I have seen this argument many times before, property values won't fall here because the situation is unique for some reason or another. Prices have fallen in NYC over the last year or so, not significantly but some to be sure. They have been propped up to a certain extent by government programs to keep interest rates low and provide incentives to buy. These government programs are ending now. This is going to make it more expensive to buy, meantime in NYC incomes are actually down due to the problems on Wallstreet. Sounds to me like a pretty good bet that prices will fall.

 

[SaraSara]

Wall Streeters are still making out like the bandits they are. Haven't you read about last year's bonuses? They are as high or higher than the bonuses before the crisis.

 

[ghost]

Not making out "like" bandits.....they are bandits.

 

[SaraSara]

Not making out "like" bandits.....they are bandits.

Check my post again: it says "like the bandits they are".

 

[gouchobob]

Wall Streeters are still making out like the bandits they are. Haven't you read about last year's bonuses? They are as high or higher than the bonuses before the crisis.

Here's the stats on incomes for NYC which you can review.

http://www.crainsnewyork.com/article/20090628/FREE/306289914&cat=economy

 

[soulskier]

Eh? Care to explain that? And, again, I'm talking about real estate on the island of Manhattan. How would some credit crisis drive prices down? I'd love to buy a brownstone in Manhattan so if you can tell me what signs of impending credit doom to look out for so I can swoop in and get one cheap, I'd certainly appreciate it. But, of course, I'd just be one of the many people lining up to buy real estate in Manhattan and all of that demand would just drive prices up again, no?

I believe when credit becomes unavailable and/or rates go up, that will dramatically inhibit people's purchasing power. Additionally, when the credit runs out, people will have a harder time making their monthly mortgage payment, which will ultimately lead to foreclosures and more properties on the market, ie increased supply.

If everyone is paying in cash, like in Argentina, that would be another story, but someone I can't imagine that is the case on la isla manzana.

 

[citygirl]

Again - I did point out a little bit about the market reality of Manhattan which is different from anywhere else in the US. The vast majority of buildings require that the buyer have 40-50% of the asking price up front (20/25% down payment and another 20/25% in liquid assets) in order to be approved by a co-op board. So yes, you're not running into a high range of default and foreclosure.

And people - while the prices have dropped in Manhattan since 2007 (although they have been on the rise again for the last 6 months)- the AVERAGE PRICE for an apt is $1.4 million (down from a high of 1.7 million). So yeah, it's not exactly a buyer's paradise

 

[gouchobob]

I believe when credit becomes unavailable and/or rates go up, that will dramatically inhibit people's purchasing power. Additionally, when the credit runs out, people will have a harder time making their monthly mortgage payment, which will ultimately lead to foreclosures and more properties on the market, ie increased supply.

If everyone is paying in cash, like in Argentina, that would be another story, but someone I can't imagine that is the case on la isla manzana.

I agree. I attached an article where Duetsche Bank predicts a 40% decline in NYC real estate, Goldman Sachs forecast I believe a 53% decline. This is bad news for sellers but good if you are a buyer. Overall I think declining prices in real estate is a good thing in the long run. Too much of our resources have been tied up in real estate, versus other more productive uses.

http://www.estatesreport.com/a354698-new-york-home-prices-forecast-to-drop-40

 

[citygirl]

That article is about NY metro market which is not Manhattan. You are comparing apples and oranges.

 

[gouchobob]

That article is about NY metro market which is not Manhattan. You are comparing apples and oranges.

For Manhattan the percentage of condos represent about 25% of the housing stock, which I would say is significant. It's all relative and I would believe if the price of a condo drops by 50% then the Coop in the next building is going to take a hit as well, or am I missing something? You could make an argument that Manhattan will be the hardest hit price wise as it the most over-valued. Time will tell.