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November 29, 2007
Foreclosures Rise as Condo Prices Sink
There’s plenty of bad news about the state of the market today. First off, the Post has a report that foreclosures in Brooklyn and Queens spiked in October. Brooklyn foreclosures were up 50 percent this October over 2006, going from 815 to 1,200, according to data from RelatyTrac. (Queens foreclosures, meanwhile, shot up a frightening 120 percent.) And the new development market isn’t looking all that great either, according to an article in today’s Sun. About a dozen condos across the city have slashed prices by as much as 13 percent over the past few weeks, according to StreetEasy data. In Brooklyn, there were price cuts at Bushwick’s Evergreen Terrace and The Washington in Prospect Heights. "A lot of this is about staying alive," says Prudential Douglas Elliman’s managing director for new developments, Andrew Gerringer. "You want to hang in the game, give an adjustment to your pricing and keep moving."
B'kyln, Qns. Foreclosures Soar [NY Post]
Signaling Cooling Market, Prices Cut at New Developments [NY Sun]
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Comments
The What is not seeming so psycho now....
Posted by: guest at November 29, 2007 9:13 AM
No worries, the dow is up, so everything is great.
btw if you're looking for a mortgage, go check out the fed home loan program: FHA. Isn't going to help the over-priced co-op and brownstone market, but they'll loan 30 year fixed nearly 100% ltv. Low FICO doesn't disqualify, up to 300k and change max mortgage & rich people can use them too!
Posted by: guest at November 29, 2007 9:17 AM
Okay, bad news for sellers and developers; the greedier they are, the badder the news. And I also understand how disappointed developers and sellers might buy fewer wide-screen TVs for Christmas and thus chill the economy somewhat. But isn't this *good* news for the one zillion folks in this town who are desperate for affordable housing? (If "affordable" comes into reach for an apartment "trimmed" from a million to $900K or such...)This entire "bubble panic" mentality strikes me as bizarre; it's a "correction," folks.
Posted by: Brenda from Flatbush at November 29, 2007 9:17 AM
It doesn't really strike me as a dire situation - Most new condo developments in Brooklyn have been overpriced by at least 15% anyway, so now you may begin to see prices that are more honest and realistic set - right from the beginning.
But it's also the worst time of year to be selling RE, and in conjunction w/ bad consumer confidence, I wouldn't be surprised to see very little buying activity until late winter/early spring.
It's just a crappy time to be a seller AND buyer, although buyers might find some deals if sellers become financially strapped.
Posted by: guest at November 29, 2007 9:19 AM
some of those buildings in some nice areas were over priced. i hope they would price them according to what it is really worth now days.
Posted by: armchairwarrior at November 29, 2007 9:19 AM
I wish a bank would forclose on my psycho neighbor in my building.
Mr. X
Posted by: guest at November 29, 2007 9:20 AM
And so the change in psychology continues...
2005: Buy now or be priced out forever
2006: We're in for a soft landing
2007: Who cares about price drops and foreclosures. Most inventory was overpriced anyway
2008?
Posted by: guest at November 29, 2007 9:29 AM
"No worries, the dow is up, so everything is great."
Huh?
Dow Last Month: -4.37%
Dow 3 Months: -5.08%
Year to Date is still up a good 6%, but it's lost a lot here in the second half of the year. I'm always confused by people drawing conclusions from daily swings in the dow.
Posted by: guest at November 29, 2007 9:38 AM
Ha.
Hope all the scumbag developers lose their shirts.
(sorry, Mr. B -- I know they're you're advertising revenue)
Posted by: guest at November 29, 2007 9:44 AM
I've been through this before--starting in 1975, a few months after I moved into my house, when the City ran out of money. It had been EXTREMELY difficult to get mortages on Brooklyn brownstones when I bought my house in late '74 and it became virtually impossible in the aftermath of the NYC 'fiscal crisis.
For a while I almost thought that my family and friends, who thought I was crazy to buy an old house in Brooklyn, instead of a nice modern house in the suburbs, might be right--they weren't. My nightmares, that my house might become worth less than the 40% downpayment banks required on old city houses, never came true
Posted by: Bob Marvin at November 29, 2007 9:49 AM
Hmmm, it seems like most of the serious price drops mentioned were in units over $1 million. Yes, sure, that could trickle further down into the market. But there's probably still a large pool of buyers with good credit who are looking to buy in the lower price ranges (+/- $.5 mill) that might keep that area of the market more competitive.
But I agree with 9:38 and Bob Marvin. One day drops and surges in the Dow don't mean much for the big picture or anything. And short of having a crystal ball, none of us can know for sure what's going to happen in the RE market.
Posted by: guest at November 29, 2007 10:36 AM
It's not just the price drops -- wait for someo of the higher-profile developments that are only 40-50% sold to start renting. And I heard the city is interested in picking up some of those units. If half of the owners wanted to "invest" (flip or trent if they couldn't sell), they are now going to be competing with the developer and or others. And pity the poor people who thought they would be living in a luxury condo.
Posted by: guest at November 29, 2007 10:42 AM
9:17, what's "100% ltv" mean? Sorry, I just don't know all these terms. And what are rich people or anyone else going to get with only 300k and change. Doesn't seem like enough to buy much these days.
Posted by: guest at November 29, 2007 11:28 AM
Now if only some of the individual sellers who actually have brownstones to sell will realise that their house isn't worth nearly what they think it is we will be ok. Just because someone down the street sold for X last year or the year before does not mean your house is worth X or X + 10% now. Sellers, take a look at the professionals and cut your prices.
Posted by: guest at November 29, 2007 11:32 AM
100% ltv = loan to value = a loan for the entire purchase price.
And no 300k doesn't buy much .. but 300k + 300k down does, and my guess is many people who look for mortgages wouldn't consider FHA if they are doing something like that.
Posted by: guest at November 29, 2007 11:38 AM
"The What is not seeming so psycho now...."
Really? So THE END is finally here? Where's the mass hysteria, bank failures, economic collapse, housing market implosion, etc. that we were promised? I'm disappointed!
Posted by: guest at November 29, 2007 12:11 PM
12:11,
That will not happen until Atlantic Yards is built which, as we're constanly reminded here, will make EVERYTHING worthless and trigger the end of western civilization ;-)
Posted by: Bob Marvin at November 29, 2007 12:42 PM
Would have been nice if the Post "article" (i.e. "blurb")had given the percent of households in foreclosure in NYC/Boros...
"Across the country, foreclosures were up 94 percent from October 2006, the RealtyTrac numbers show. With a total of 224,451 filings, the national rate for the month was one foreclosure for every 555 households."
We don't get an idea from the blurb if NYC is experiencing one foreclosure for every 555 "households" ("household" is misleading b/c it is used by the census to mean either an owned or a rented residence). Is NYC seeing 1:555, 1:1000, or 1:250?
Anyone have the figures?
Posted by: guest at November 29, 2007 12:46 PM
hey 10:30, you're right--some people DO win the lottery. Like me. I won 200 million bucks back in 02 and my life has gone deep into the toilet since then. Drugs, hookers, ne'er do well relatives, an ill-fated hip hop record label... you name it, it happened to me. Stupidly, I took the lump sum and now I'm down to about 450K. Just hoping those condo prices keep dropping so I can get a 1BR to live out my days...
Posted by: guest at November 29, 2007 12:59 PM
"Is NYC seeing 1:555, 1:1000, or 1:250?"
Why does the ratio matter?
As long as foreclosures are rising, not falling, the downward pressure on prices everywhere is increasing, not decreasing. That is all that matters.
Posted by: guest at November 29, 2007 1:05 PM
""The What is not seeming so psycho now...."
Really? So THE END is finally here? Where's the mass hysteria, bank failures, economic collapse, housing market implosion, etc. that we were promised? I'm disappointed"
Let me explain myself. I have seen this Mutant Real Estate Bubble come into life. Like then, I said "this thing is unreal". But the Machine keep pumping money into this shit. And now the piper wants his money back. The credit markets are getting pounded right now! The risk spreads from Libor to you is getting wider everyday. If you (dumbasses) think that cutting rates is going to save housing then, you are fucking crazy. Credit will dry up and you will not be able to get a mortgage NOWHERE! What's happing now is the tip of the iceberg and when this thing gets really going, GOD help us all. America is toast, thanks to all the greedy fuckers out there.
The What
Someday this war is gonna end.....
Posted by: guest at November 29, 2007 1:12 PM
"America is toast, thanks to all the greedy fuckers out there."
Timeframe?
Posted by: guest at November 29, 2007 1:28 PM
"America is toast, thanks to all the greedy fuckers out there."
Timeframe?
I used to think the same way, yeah America is badass man! But 911 came and I said "It's different", like now.
I think it has already started, they are just trying to find the best option.
The What
Someday this war is gonna end..
Posted by: guest at November 29, 2007 1:45 PM
Here folks, this is what happens in a meltdown. It just begun. LMMFAO
Florida suspends withdrawals from state investment fund. <-- State now ya hear!
http://www.orlandosentinel.com/news/local/state/orl-bk-statefund112907,0,5698387.story?coll=orl_tab01_layout
The What
SOMEDAY THIS WAR IS GONNA END.... sorry was this over the top?
Posted by: guest at November 29, 2007 2:00 PM
"Here folks, this is what happens in a meltdown. It just begun. LMMFAO"
OH! It's JUST BEGUN! Who knew?? I thought we were already there!! My mistake. Boy, this is confusing!
Posted by: guest at November 29, 2007 2:05 PM
so here's the objective point of view, considering the incessant negative skew the liberal media continues to put out to favor democratic candidates.
-while forclosures were up in Brooklyn and Queens, this was expected and the numbers are not huge compared to other parts of the nation.
-one would expect forclosures to increase in a cyclical type market where the previous years saw unprecedented gains, it's part of the equation after all; unprecedented gains lure speculative investors without the true means to weather the rough patches, what did we expect..the end of forclosures?
-in a stunning rebuke to conventional wisdom, Staten Island and Manhattan held their own in the forclosure stakes with nothing negative to speak of.
-the second quarter Gross Domestic Product of the nation came in at a staggering 4.9% gain, once again defying all the NYTimes zombies who were waiting for the "recession" of their wet dreams to appear in time for the next election.
-New Housing purchases were UP last month. That's spelled U P, as in , people are buying homes.
-Online consumer spending and Black Friday spending were unexpectedly HIGH, as in people must be doing alright out there to be buying stuff.
-Wall Street has been posting huge gains in the past couple of days, once again digesting the interminable "subprime meltdown" mantra that the liberal media is putting out, and spitting back the fact that corporate earnings aren't that bad after all and the subprime mess has had it's 15 minutes of fame.
I'll await the vitriol and venom from the liberals who just wanted a recession for Christmas but are still sucking their thumbs in the corner because they never had the cajones to buy in when they had a chance. And by the way, it's still not too late, there are plenty of homes out there in Brooklyn in the 300-500k price range in case you're still interested. Just don't expect anyone to hand you a brownstone.
Posted by: guest at November 29, 2007 3:44 PM
"so here's the objective point of view, considering the incessant negative skew the liberal media continues to put out to favor democratic candidates."
Hey, I'm a lifelong DEMOCRAT, and I happen to agree with pretty much everything you said! So lighten up on blanket "liberal media" labels.
Posted by: guest at November 29, 2007 4:11 PM
Hey 3:44 I hope you stick to your words in 08.
The Main Steam Media is a bunch of bullshit. America is living off of CREDIT and DEBT. I will not go into a rant, it won't any difference.
The What
Someday this war is gonna end....
Posted by: guest at November 29, 2007 10:57 PM
For all you out there making negative comments against developers... I work for a developer and I want to make something clear. There were MORTGAGES paid out to people who really couldn't afford to buy a home that, in my mind, were ILLEGAL!!! All this "creative financing" is all hogwash to me and I couldn't believe the amount of people who bought mortgages like that. All these people are insane!!!! How could they NOT consider the consequences???? I really don't feel bad for these people because they should have taken into consideration all the what ifs with this. Buying a house is a BIG DEAL. How can you NOT take all the what ifs into consideration? (such as would I be able to afford this mortgage if the rates go up?)
The reason for the housing crisis is simple. Our country has been going through a time where everything is being based upon a fake economy. These creative mortgages, as they say, are one of the reasonings behind this fake economy we live in now... the other is all the credit debt everyone seems to be facing on a yearly basis!!!
As for affordable housing, I work for a developer who is in the business of affordable housing. You don't need to place the blame on the sales prices on the developer, because with affordable housing it is, (get this) THE CITY OF NEW YORK (HPD, HDC, Partnership) who DICTATES to us what the sales prices should be. And, the developer doesn't make too much of a profit with affordable housing. We're only doing this for the people in the City of New York to help them better their lifestyles.
We're the ones who are arguing with city agencies about how ridiculous and unfair their original sales prices are that they want us to market for.
So, trust me, the developer only develops what is in the plans AND the developer basically takes orders from City agencies (like HPD) in terms of when to hold lotteries, what the sales prices are, what kind of people to market to, etc.
If anything, don't blame the developers... blame our confused City agencies for all the sales prices on affordable housing.
Posted by: guest at November 30, 2007 9:49 PM
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