Corcoran: ‘Brooklyn Pricing May Be Reaching Bottom’

corcoran-q4-report-012210.jpg
Although the data from Property Shark shows that prices were down by at least 10 percent in the fourth quarter of 2009 versus 2008, Corcoran’s latest market report boldly states that “Brooklyn pricing may be reaching bottom as the national and local economies strengthen and sales activity increases versus the first half of 2009.” Some of that optimism stems from the fact that prices are decreasing at a slower rate than in previous quarters. The stats from the resale market—median prices slipped just 2 percent year-over-year—were also encouraging; single-family townhouses held up particularly well, with the median price in the fourth quarter ticking up 13 percent from the third quarter and a whopping 51 percent from the same period a year earlier. For details on how different neighborhoods fared, check out the report.
4th Quarter 2009 Brooklyn Report [Corcoran]

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  • daveinbedstuy

    I stand by my prediction that brownstone prices bottom late 2009/early 2010. It now looks to be spot-on.

  • dittoburg

    by “local economies strengthen” I presume they are referring to the NYC unemployment rate now having hit 10.6%, as reported today elsewhere.

  • Morning, Dibs. Nice to meet you last night.

    Really depends if that rate of change in prices is a short term product of the stock market rally and the 5% government supported interest rates (via Fannie/Freddie) or a more solid footing for income and sentiment.

    The other article about the city’s unemployment rate shooting up to 10.6% is a little scary and contradicts portions of Corcoran’s assesment of the local economy.

    Here’s to hoping that unemployment rate starts falling soon, since I know it is much worse for certain parts of the city and demographics. In the meantime, if prices decide to fall another 10% I’ll take it.

  • Is it just me or is the spin around these reports just silly and distracting? 2 years ago prices would keep going up, then it was, okey they’ll rise modestly orver time, then no way could they fall, now they’ve fallen and it “OK folks; it’s all over now”. A 30 cycle of housing appreciation, interupted in the early 80′s and early ’90′s is being tested and we’re supposed to believe that it’ll all get resolved in a year. I don’t get it.

  • When you cherry pick your data you’re always “spot on”.

  • daveinbedstuy

    The only foreign government representative to agree with Obama’s peoposals yesterday regarding the banks was, of course, the French.

  • daveinbedstuy

    When you cherry pick your data you’re always “spot on”.

    Posted by: ecoux at January 22, 2010 9:16 AM

    The data’s up there^^^^^^^^

    Where’s your data to refute it???

    What is it with people like you that criticize data without any other data to support it??? These numbers are factual, not projections or guesses.

  • “single-family townhouses held up particularly well, with the median price in the fourth quarter ticking up 13 percent from the third quarter and a whopping 51 percent from the same period a year earlier” — I would hardly call 13% ‘ticking’ but nevermind…
    But I hope this shows that you can’t pay attention to all these nonsense stats. Obviously value of one’s single family house did not go up 51% since last year. Nobody would claim that.
    This sales stats figures are just that. Prices of what SOLD.
    They are not (necessarily) reflective of the changes in value of ones property.

  • daveinbedstuy

    Ah yes, the old “these only reflect what sold” argument.

  • daveinbedstuy

    I di however suspect that the 1-Family data was skewed by the Jennifer Connolley mansion and maybe 2 other sales.

  • Prices of multifamily houses (2-4) down 24% from Q3 ’09 to Q4’09 and down 23% from Q4 ’08 to Q4 ’09.

    Data from the same report.

  • daveinbedstuy

    Prices of multifamily houses (2-4) down 24% from Q3 ’09 to Q4’09 and down 23% from Q4 ’08 to Q4 ’09.

    Data from the same report.

    Posted by: ecoux at January 22, 2010 9:27 AM

    You’re missing the point. We all know how much things are off from 2008 prices.

    The point is (and it was confirmed by the Douglas Elliman data yesterday) that the rate of decline has come down dramaticcally. Prices are bottoming. That’s what a lower rate of decline shows when you graph it.

  • I’m not saying that prices haven’t stabilized or whatever.
    Just that people keep citing stats that reflect mix of what happened to be on market and sold and interpret that as – oh prices are up or down this or that.
    For one, I don’t think values went down as much as some people think in past couple years and I certainly don’t think they are up 50% since last year.
    Sample size for up or down market is so small especially when divived by property type and neighborhood that ends up being almost meaningless.

  • Cocorean? The same group that told us home prices were never going down? Barbra Cocorean the lady who overinflated home prices with her “pump and Dump” home selling? Cocorean please shut and stop trying to stop the downfall of home values that you yourselves raised until it was no longer possible. You are worst than our Mayor , who is now telling Washington to stay out of Wall Street and let Capitalism do its thing. A little retorical don’t you think? Where was the Mayor when Washington had to step in a give the banks our tax money to save them from bancruptcy? Everyone complains to suit their interests!

  • I haven’t bought a house yet therefore house prices haven’t bottomed. QED.

  • daveinbedstuy

    Pete, 1-Family is a very, very small sample size, you’re right.

    Elliman’s 1-3 family data yesterday did a better job at it that does this. But I think the 2-4 Family data here is more representative.

    I know my house in Bed Stuy would sell right now for a lot more than 25% off what I paid for it in 2007. And, I don’t believe it would have sold for more in 2008 than it did in 2007.

  • Read the sentence. Q3 ’09 to Q4 “09 down 24%. Not 2008.

  • more4less

    let others debate the general mkt trend while I’ll just look for the super over-leveraged idiot to pop and then buy his/her house for cheap

  • daveinbedstuy

    “You are worst than our Mayor , who is now telling Washington to stay out of Wall Street and let Capitalism do its thing.”

    The only support for Obama from outside the US came from….France!!! All other nations ridiculed this effort. Obama has lost a lot of credibility.

    This will never pass Congress, anyway.

  • DIBS — apparently yesterday, I am told, I was arguing that houses should be free and given out in a soviet-style lottery. So, that will probably be the bottom, not this.

  • too much data or not enough data?

    how can two reports (Corcoran / PDE) be so dissimilar?

    stick to comps.

    m4l- same old saw, eh? can you pls explain why/how the overleveraged idiot sells to you at a below market price? seems more likely that the overleverage idiot would sell for a market price. but maybe i’m daft.

  • daveinbedstuy

    Well, tybur6, with this nutjob for a President, it would seem that’s exactly where we are headed

    [Making sure NRA membership still valid]

  • I am an Obama supporter but this bank reform proposal (if you can call it that) was so poorly laid out yesterday that it has completely spooked the markets and our global partners. Disjointed, vague, etc. Risk taking by banks is not a bad thing. Unregulated risk-taking is bad for everyone and that goes for investment banking and mortgage lending! Obama is going down the tubes fast and I am very sad to see that happen.

  • Maly

    Dibs, France has many large banks, and has a highly-regulated environment. What are the “other countries”? Are you talking about the United Kingdom? The UK has the same problem that we have: the insane people are in charge of the asylum. What do expect them to say? From their point of view, the absence of rules coupled with unlimited feeding at the tax trough is an ideal environment.
    Besides, do you remember the last time everyone agreed with us, except for the French? How well did THAT turn out?

  • daveinbedstuy

    Maly, every other country that commented said that it was a bad idea to mess with the businesses itself. The use of reserve requirements and all the other tools that central banks have at their disposal were enough.

    The last precedent for an action like this was when kennedy went after the steel companies for raising prices. In fact, Obama’s speech was almost word-for-word the same speech that Kennedy gave substituting “big banks” for “steel.”

  • Data can be manipulated. And statistics aren’t always correct. Standard deviations vary widely depending on the sampling of the data so on the statement that data is factual is not a true statement.

  • “Risk taking by banks is not a bad thing. Unregulated risk-taking is bad for everyone and that goes for investment banking and mortgage lending!” Really Martis I deposit 100,000 in a CD the bank gives me 1% my bank in return takes my money out the back door and invests it in speculative real estate market makes a gazzilion percent profit the first year and of course gives great bonuses to the Great Wall Street minds. But then things go sour like all bubbles do and the government has to bail out those same banks with out tax money. Do you see something flawed in that?

  • daveinbedstuy

    Data can be manipulated. And statistics aren’t always correct. Standard deviations vary widely depending on the sampling of the data so on the statement that data is factual is not a true statement.

    Posted by: lossforwords at January 22, 2010 10:39 AM

    Oh, please!!!

  • oh pls. the hyperventilating from the right about the tougher regs for banks is soooo over the top. sadly, par for the course.

  • daveinbedstuy

    In fact, hannible, the two WORST BANKS IN THE WORLD, HBOS and Northern Rock, only took risks in commercial lending, NOT derivatives & proprietary trading.

  • So Citibank Wakovia and all the other banks were doing just fine? Our government maybe just decided it would have been a good idea to give them a 700 billion dollar booster TARP shot right? Jailtime for bankers is the best solution. why do common criminals have to go to jail for stealing a 10,000 dollar cars and Wall Street crooks because that is what they are! get bonuses and free cigars?

  • daveinbedstuy

    No one ever said ALL banks were doing fine.

    You’re reverting back to your other personality after we had established good raport with the “normal’ one.

  • On Obama – Biggest retart out there. I cant beleive this guy still wont focus on creating jobs! No, now instead of taking over healthcare and nationalizing the largest jobs growth sector in the coutry, we are going to go after big banks and take away their profit and job creating incentive????

    Hello, capital and profits create jobs! Taxes, penalties, and anti-business policies destroys jobs.

    This guy just created an all new financial crisis single handedly.He wont be happy until we are all either unemployed or work for the government, or should I say the Obamament.

    I gotta go, checking to see if the IRS is still hiring…

  • daveinbedstuy

    NSS, I don’t know why the administration and Congress never gave a boost to the econmy where it would bo the most good….spending. Why did then never eliminate the FICA contributions for,say, six months??

    Why did the consumer receive, NOTHING, ABSOLUTELY NOTHING.

    These people just don’t get it. They have no grasp of economics. Only the Fed seems to understand anything and they can’t do anything directly. All of the easing clearly went into the stock market last year.

  • Eliminate FICA for six months!!! Are you crazy? The precious life blood of Bureaucracy???

    No DIBS, that would entice the masses into actually enjoying having more money which would only sting doubly when we have to take it all back and then some later on to pay for some new programs or project we like.

    You dont know why congress never gave a boost to the consumer? Frankly, I dont know how congress figures out how to put their pants on every morning.

  • you have a better grasp of economics than summers, goolsbee, et. al.?. sorry i’ll stick with what we have rather than you and your tired supply side, anti-regulatory tropes. given where we were headed i think being stuck in neutral for a bit is fine, just fine. if it takes a bit of time to get the economy in gear, so be it. better to find solid footing than reach for ephemeral *panaceas* and risk a second major dip. this country faces a severe and long-term economic crisis from which there are no easy answers.

  • ^^^ Ditto what antidope said @ 11:43. ^^^

  • “This country faces a severe and long-term economic crisis from which there are no easy answers.”

    Not True Antidope, the easy answers are already out there, Go after Wall Street and the big bad corporations. In fact anyone making too much money or too much profit needs to pay. That makes perfect sense, that will solve everything.

    Oh by the way, when are they going to go after oil companies again? Im sure that one is waiting on the back burner.

    Reminds me of the episode of the Simpsons when they narrowly avoid being hit by a meteor and then they announce “Lets burn down the observatory so this can never happen again”. Same mentality.

  • Always the same drivel from the free market utopians. Any attempt to curb the excesses of irrational markets is an attack on capitalism and freedom itself.

  • Donald Brennan

    A slowing rate of change does not explicity imply that a cycle bottom is approaching. Pent up demand and the fear of rising interest rates may have more to do with this short term activity than one may think.

    Rising unemployment, a prolonged recovery (NY has trailed the nation in recovery an average of two years during the past 7 recessions), a plethora of housing options and the prospect of higher borrowing costs coming towards us are significant headwinds for a recovering residential real estate market to advance against.

    To believe that we have turned a corner you would have to discard the notion that easy credit and poor lending standards were part of the cause in the last run up in prices.

  • “Brooklyn Pricing May Be Reaching Bottom”

    Oh absolutely! We’re almost halfway there! Only another -37.5% to go!

    ***Help Haiti***

  • I don’t understand today’s data vs. yesterday. Yesterday housing prices were going down, down, down. Today they’re reaching a bottom. Someone please explain.

  • “I stand by my prediction that brownstone prices bottom late 2009/early 2010.”

    Only after abandoning your original one without the “/early 2010″. A tree grows in DIBS’ prediction. Awesome!

    ***Help Haiti***

  • C’mon DIBS, the entire banking industry was insolvent in October 2008. They only exist today because we bailed out AIG. Now they’re paying themselves big money because they can borrow at 0% and lend at 6%.

    Who the fuk has the gall to complain about tighter regs. The Chicago school is dead.

    I work for an IB and I’m still mortified.

  • fatlenny–you nailed it, and further than that, the industry would have been sunk even if they just stopped at just bailing out AIG–without FDIC debt guarantees and intervention in the structured securities markets there would have been a ton of carnage.

  • Question: When you guys are deliberatin’ and conjugatin’ the Emancipation Proclamation of this credit crisis do you account for the fact that the gov’t actually made money off of the bailout? http://tinyurl.com/nyra2s

    Just sayin…

  • more4less

    antidope, over-leveraged buyers POPPED = REO = potential cheap house. btw, sitting out of housing mkt recent has added to my cash pile – very necessary if I’m got get house for cheap. Will it work? hopefully but who knows. but that’s the plan and I’m trying it out.

    as I said before, when I get that house for cheap, I’ll invite you over for some drinks

  • lossforwords–as the article observes, that’s before the cost of fannie, freddie and AIG, not likely to be small sums. I’m not anti-bank but the banks will likely oppose most new regulation but clearly more stringent regulation is needed.

  • u need another shock first.
    have u seen any decent reo property in brownstone bkln?
    no, right, bc in these ‘hoods banks put up the stuff with a broker and it sells just like any other home…at market price. and brownstone bkln is not distressed…

    i can read your mind: “not YET distressed.”

    lossforwords-sure, the govt has made money on those banks that have returned money, but overall tarp is still in the hole over $100 bio, so to say taxpayer’s have made money is equivalent to hedge fund managers scraping money off their investor *profits* before actually returning any cash, much less the capital invested. iow, it’s bogus accounting that investors shouldn’t’ve put up with (thank you mr bubble) and taxpayers shouldn’t have to live with. without the taxpayer support, a) a good majority of these banks wouldn’t be in business and b) the vast majority of the trading profits earned in 2009 would not exist (free leverage via off market haircuts at the fed on top of 0% FIDC loans).

  • the government, especially states, are losing money like crazy due to reduced tax revenues after the shadow banking system brought the economy to its knees.

  • Bernanke get rid of all this garbage and bad blood! Raise interst rates and let the chips fall where they may.

  • I’m all for regulation too but the proposal could result in some dire consequences for the economic recovery. It will cost Goldman Sachs, Morgan Stanley, Credit Suisse, UBS, and Deutsche Bank as much as $13 bln in revenue.

    But there will be loopholes. I’m sure of it.

  • The majority of the TARP loss comes primarily from AIG, GM + Chrysler. GM + Chrysler got bailed out because its ok to bailout unions. Not sure who AIG had the goods on.

    TARP Loss on banks will be a fraction of the money that the Federal Government loses on Fannie Mae + Freddie MAC which somehow managed to avoid being hit with the new tax designed to recoup losses from the bailout and managed to avoid being covered by the pay czar.

  • 2-4 fam [the segment that matters - all else will either fare worse (apartments) or have less influence on the overall market (single-fams)]:

    YOY price avg: -16%
    YOY price med: -24%
    QOQ price avg: -17%
    QOQ price med: -23%
    YOY volume: +59%
    QOQ volume: +20%

    So the data says we’re double-dippING in prices (reGOVery stimulii on low summer/fall volume now fading) but single-dippED in volume as it is now spiking. +20% in sales over one small quarter compared to +59% over a whole year is pretty significant because +20% for all four quarters would have been +100% YOY.

    As I said yesterday, volume peaks twice in a cycle. Once before the top (euphoric climax), and once before the bottom (capitulation). We cannot discuss a bottom in prices until we agree that volume has peaked again. Even Corcoran wouldn’t agree with that as they say “sales activity increases”.

    “Some of that optimism stems from the fact that prices are decreasing at a slower rate than in previous quarters.” – brownstoner

    Because of the double-dip created by the temporary relief of the reGOVery.

    Also, how much has volume decreased for 1-fams? Corcoran says it’s down but I couldn’t find their number on how much. If it decreased by a lot (just a few sales here and there), then these touted +13 and +59 percent numbers are even more misleading than they already are because 1-fams don’t largely influence the overall market in the first place.

    I’m more confident than ever that 2-4 fam brownstone prices will fall in half from peak comps.

    ***Help Haiti***

  • Its all smoke and mirrors anyway. Who actually beleives any new tax on anything,Banks,Oil,Pharma, whatever, will actually “Go to paying the taxpayers back”.

    Fat chance of that happening – do you think you will get a check in the mail for your share of the proceeds? Or even a reduction in your taxes or a paydown of the deficit? Any new tax will just be added to the spending wish list of politicians and become the new baseline for ever increased taxing and spending.

  • more4less

    Antidope, you’re probably right but bank is probably more open to a bigger discount than a normal seller. but bottom line is if one doesn’t try, one gets NOTHING. Plans dont always work out but not planning to do something guarantees nothing materializes

  • I predict further price declines in 2010, with the usual set of biases (prime properies fare best, new condos and / or “fringe” areas get hit hardest). I’m not prepared to predict an amount of the decline. But definitely negative.

  • “A slowing rate of change does not explicity imply that a cycle bottom is approaching.”

    But, Donald Brennan, it’s not really a slowing rate of change overall. It’s a double-dipping. We’re on the second dip. Corcoran tried to compare the summer/fall deadcat bounce to the spring valley but I caught ‘em! Besides, even they disclose that data is 2-3 months behind, as is Case-Shiller, because of the public record process.

    “To believe that we have turned a corner you would have to discard the notion that easy credit and poor lending standards were part of the cause in the last run up in prices.”

    BULLSEYE, Donald Brennan!!!

    ***Help Haiti***

  • Look, there’s nothing Washington can do. There wasn’t anything they could do in the 1930′s except declare a world war a whole decade later. We are in a deflationary collapse. The money supply grows and shrinks with debt creation. Loans are now contracting as fewer and fewer are taking them out. Great Depression Redux. You guys are getting lost in details.

    ***Help Haiti***

  • “prime properies fare best”

    Nope. Everything up +200% from 90′s trough, everything half off. The disparity in home prices between ‘hoods was already built in before Ponzi credit. After everything half off, yes, Park Slope will still be more expensive than Bed Stuy as it always was before the credit giveaway which is what this whole bubble was all about. EVERYTHING was overvalued. [BTW, nice to see ya, lechacal!]

    ***Help Haiti***

  • BHO we need the details or the non believers will keep preping up home prices. They have no clue that home prices are going back to 1992 levels. It is very difficult for them to believe they got dooped by the real estate broker when they bought.

  • They have no clue that home prices are going back to 1992 levels

    That would be awesome hannible. I cant wait to buy like 3 or 4 places which will be no problem with 1992 pricing. Heck, I might even buy Prospect Park and turn it into my own personal estate. Life is going to be so wonderful for all of us soon!

  • daveinbedstuy

    Reading all of this is very amusing after lunch.

    For example: “They have no clue that home prices are going back to 1992 levels.”

    Can you actually cite 1992 prices???? Why did you pick 1992????

  • Yeah, I was dooped alright.

  • Damn, hannible! 1992? Your forcast is worse than mine. But I wouldn’t put it past the collapse. Can’t sleep on the overshoot.

    Mopar – Were you able to qualify for FHA financing?

    ***Help Haiti***

  • 1992 is the year we get Billy Boy linton in office but that is not the important point. The most important point is that in 1992 we get the idea? notion? creed? that every American is “entitled” to the American dream. it is from that moment that the idea of needing hard work, sacrifices and time to buy a home went all in the gutter. It was from that moment thatFrannie and Freddie started to go senial. Those are the original prices of homes. From 1992 until today we have all been living in a fantasy world with cheap easy credit.