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January 28, 2009

Case-Shiller: November Crappiest Month Ever

Prices for homes in the New York area declined at a faster rate in November than in any other month on record. According to the S&P/Case-Shiller Index, properties within a 50-mile radius of the Big Apple declined 1.6 percent between October and November and 8.6 percent year-over-year. The news wasn't all bad though: New York prices are still up 87 percent since the index started in 2000. New York also had company in the misery department: Atlanta, Boston, Charlotte, Chicago, Dallas, Portland and Seattle all had their worst months ever.
City Sees Record Home Price Drop [The Real Deal]
Home Prices Fall at Record Pace [CNN]
NY Home$ in Record Plunge [NY Post]
Home Price Index Fell Again in Nov. [NY Times]

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Comments

Off 8.6% year-over-year. That's less that the typical "10% off of ask" that would be normal for a buyer to offer a seller; in normal times I might add!!

No problem here folks, just keep on walking.

Enter the loons, stage left.

Posted by: daveinbedstuy at January 28, 2009 9:05 AM

wait until the numbers for Dec-08 come out. that 1-month drop record won't be held long by contestant Nov-08.

Posted by: martis at January 28, 2009 9:06 AM

I love short memories...

... about 10+ years ago there was the dotcom boom/bubble/burst.

Home prices skyrocketed, plummeted, leveled, rose... Mass layoffs, company and industry failures.... sound familiar?

I worked in the dotcom sector back then, the days of "it's the end of the internet... recession... depression... can't afford to live..."

This too shall pass..

Posted by: christopher at January 28, 2009 9:10 AM

Yes, christopher...as ditto or slope reminded us last week it's the "goldfish" syndrome.

People's brains are so small that they have a memory like that of a goldfish...Each time around the bowl is an brand new experience for them!!!!

Posted by: daveinbedstuy at January 28, 2009 9:15 AM

Outlook is bright from here on. with the creation of Obamas bad bank I think we go level off in the next 6 months. If you look at recent closings we are holding our own.

Posted by: sebb at January 28, 2009 9:24 AM

If anyone has a reason to want to see home prices fall it's people like me; those just finishing their educations, hoping to embark on reasonably lucrative (no MBA here, more like a MPA) careers. But my obvious bias favoring team bear is offset when I consider the dwindling volume of homes for sale in the market place.

In my eyes the immense volume of transactions over the years have been comprised of people trading-up, rather than selling and moving on. My point here is, even if prices come down some, they aren't going to crash -- not unless people begin to flee. New York is home base for the majority of people who own property here, I think. And the last I checked there is no scheduled mass exodus to the 'burbs, like that my parent's generation embarked on.

Maybe I'm wrong -- honestly, I hope I am; but, prices in Brownstone Brooklyn will never again be close to relatively affordable. If I had to guess, worst case scenario, average prices will bottom out at 50% above what they were in 2000.

So to me there's really no such thing as a bear market, at best it becomes more like a neutered bull.

Posted by: YngRntr at January 28, 2009 9:35 AM

I have a pretty good memory. I'm old enough to remember the economic problems in the 1970s, the Wall Street "crash" in the 1980s, the dot-com bust, etc. I'm not making any predictions about home prices, but if you think this economic downturn is no worse than those, you haven't been paying attention.

Posted by: greenwood at January 28, 2009 9:49 AM

Even I don't disagree with that greenwood.

Here's a well written, brief story about how this type of recession, which is probably best referred to as Hayekian, is different from what we all know as a Keynesian cycle....

http://economictimes.indiatimes.com/Opinion/Beware_Recession_may_be_Hayekian/rssarticleshow/4039058.cms

Posted by: daveinbedstuy at January 28, 2009 9:55 AM

agreed with posters above
December saw an uptick in home volume sales (maybe not an increase in home prices). With Mortgage rates and home prices dropping and with spring around the corner I think we will see an increase in home sales with buyers coming out a bit to "play" and "test".
I also beleive that companies are taking stock now and thinking twice about laying off mass amounts of people. Who will be left to run these companies back to success?

Posted by: gemini10 at January 28, 2009 9:59 AM

> "Enter the loons, stage left."

Don't bother, they're here.

Posted by: SnarkSlope at January 28, 2009 10:00 AM

I had a conversation with someone the other day and they wonder what are people thinking.. The delusion and denial is astounding. We are in the worse economic crisis in years and still the Assheads spew of crap like "Outlook is bright from here on. with the creation of Obamas bad bank I think we go level off in the next 6 months. If you look at recent closings we are holding our own.".

Bank of America and Citibank are ZERO'S! They are done, finished and kaput. If you are long anything right now (including housing) thing are turn out real bad for you.

Bankers' Fear of Unemployment

http://online.wsj.com/article/SB123293202890614265.html?mod=googlenews_wsj

"Last week, consumer lender Capital One Financial increased its unemployment forecast to 8.7% by the end of 2009, from its previous expectation of 7% by midyear. And Capital One added that it is building more-severe unemployment scenarios into lending decisions."

In the Capital One conference call the CEO said that ""The economic downturn was the key driver of our fourth quarter and full year results, and we expect that the recession will continue to impact our results throughout 2009," said Richard D. Fairbank, Capital One's Chairman and Chief Executive Officer. "

But fools suffer gladly...

The What

Someday this war is gonna end..

Note to Team Bear: Leave this alone and let the dumbasses keep going...

Posted by: Return of The What at January 28, 2009 10:08 AM

This economic crisis, like other crises in the past, will bring back the fundamentals to the fore. It doesn't mean it's the end of the world as we know it.
You take a dash of the 87 crash (asset devaluation? check!), a pinch of the dot com bubble burst (new math not so new after all? check), mix it up a bit with the great depression (ponzi scam and fraudsters? check), and voilà! Nought Soufflé, all deflated.
People will still go to work, (or collect unemployment), be miserable and underemployed, pay rent, buy food and clothes. Maybe not as much as before, but this too shall pass. Soon enough, asshats in Prada will double-park their Hummers on Avenue B again.

Posted by: Maly at January 28, 2009 10:44 AM

I'm sensing the SOTD may already be won, but I will keep an open mind. Off to meetings, whee!

Posted by: SnarkSlope at January 28, 2009 10:51 AM

DIBS, interesting article.

Greenwood, I'm not saying this cycle is the same as others, what I'm saying is every downturn or recession the doomsday folks come out and the media runs with the "end is near" type stuff.

I'm sure the next few years will be tough, all I'm saying is that this country has come through tough times in the past and I'm sure we'll get through this as well. More thoughtful spending and saving is always a good thing....

Posted by: christopher at January 28, 2009 10:55 AM

"Enter the loons, stage left."

No drum roll! Come on, dave!

The big picture...

MO-YR YOY REMARK
Apr-91 -8.89% ACTUAL BOTTOM
May-91 -8.12%
Jun-91 -6.91%
Jul-91 -5.57%
Aug-91 -4.23%
Sep-91 -3.04%
Oct-91 -2.33%
Nov-91 -1.71%
Dec-91 -1.14%
Jan-92 0.00% BOTTOM CALL (changes sign)
Feb-92 0.94%
Mar-92 1.92%
Apr-92 2.92%
May-92 2.84%
Jun-92 2.23%
Jul-92 1.45%
Aug-92 1.19%
Sep-92 0.91%
Oct-92 0.63%
Nov-92 0.72%
Dec-92 0.82%
Jan-93 1.27%
Feb-93 1.40%
Mar-93 1.41%
Apr-93 1.26%
May-93 1.37%
Jun-93 1.73%
Jul-93 1.82%
Aug-93 1.58%
Sep-93 1.65%
Oct-93 1.91%
Nov-93 1.99%
Dec-93 1.80%
Jan-94 1.42%
Feb-94 1.34%
Mar-94 1.70%
Apr-94 2.04%
May-94 2.43%
Jun-94 2.30%
Jul-94 2.52%
Aug-94 2.71%
Sep-94 2.71%
Oct-94 2.54%
Nov-94 2.11%
Dec-94 2.15%
Jan-95 2.18%
Feb-95 2.43%
Mar-95 1.76%
Apr-95 1.16%
May-95 0.62%
Jun-95 0.49%
Jul-95 0.27%
Aug-95 0.11%
Sep-95 0.11%
Oct-95 0.30%
Nov-95 0.45%
Dec-95 0.43%
Jan-96 0.45%
Feb-96 0.56%
Mar-96 1.22%
Apr-96 1.50%
May-96 1.70%
Jun-96 1.20%
Jul-96 1.24%
Aug-96 1.44%
Sep-96 1.62%
Oct-96 1.57%
Nov-96 1.48%
Dec-96 1.69%
Jan-97 1.84%
Feb-97 1.71%
Mar-97 1.36%
Apr-97 1.38%
May-97 1.47%
Jun-97 2.53%
Jul-97 2.94%
Aug-97 3.00%
Sep-97 2.92%
Oct-97 3.10%
Nov-97 3.65%
Dec-97 3.85%
Jan-98 4.10%
Feb-98 4.71%
Mar-98 5.39%
Apr-98 5.91%
May-98 6.20%
Jun-98 6.19%
Jul-98 6.54%
Aug-98 6.96%
Sep-98 7.54%
Oct-98 7.81%
Nov-98 7.80%
Dec-98 7.60%
Jan-99 7.35%
Feb-99 7.20%
Mar-99 7.45%
Apr-99 8.06%
May-99 8.15%
Jun-99 8.65%
Jul-99 8.86%
Aug-99 9.49%
Sep-99 9.69%
Oct-99 10.00%
Nov-99 10.27%
Dec-99 11.01%
Jan-00 11.74%
Feb-00 11.85%
Mar-00 11.83%
Apr-00 11.81%
May-00 12.82%
Jun-00 12.68%
Jul-00 12.62%
Aug-00 12.41%
Sep-00 12.38%
Oct-00 12.49%
Nov-00 12.48%
Dec-00 12.68%
Jan-01 12.66%
Feb-01 12.90%
Mar-01 13.04%
Apr-01 12.88%
May-01 11.53%
Jun-01 11.23%
Jul-01 11.29%
Aug-01 11.49%
Sep-01 11.98%
Oct-01 12.08%
Nov-01 12.49%
Dec-01 11.49%
Jan-02 11.12%
Feb-02 10.47%
Mar-02 10.50%
Apr-02 10.67%
May-02 11.61%
Jun-02 12.13%
Jul-02 12.97%
Aug-02 13.45%
Sep-02 13.65%
Oct-02 14.31%
Nov-02 14.87%
Dec-02 16.42%
Jan-03 17.06%
Feb-03 17.46%
Mar-03 17.30%
Apr-03 16.88%
May-03 16.16%
Jun-03 14.87%
Jul-03 13.55%
Aug-03 12.63%
Sep-03 12.46%
Oct-03 12.11%
Nov-03 12.07%
Dec-03 11.78%
Jan-04 11.65%
Feb-04 11.96%
Mar-04 12.29%
Apr-04 12.55%
May-04 13.02%
Jun-04 13.85%
Jul-04 14.49%
Aug-04 14.69%
Sep-04 14.44%
Oct-04 14.60%
Nov-04 14.38%
Dec-04 14.08%
Jan-05 14.40%
Feb-05 14.78%
Mar-05 15.34%
Apr-05 15.33%
May-05 14.92%
Jun-05 14.38%
Jul-05 13.72%
Aug-05 13.71%
Sep-05 13.93%
Oct-05 14.15%
Nov-05 14.49%
Dec-05 14.86%
Jan-06 14.06%
Feb-06 13.30%
Mar-06 11.53%
Apr-06 10.75%
May-06 10.01%
Jun-06 9.13% ACTUAL PEAK
Jul-06 7.70%
Aug-06 5.94%
Sep-06 4.52%
Oct-06 3.20%
Nov-06 1.87%
Dec-06 0.52%
Jan-07 -0.34% PEAK CALL (changes sign)
Feb-07 -0.91%
Mar-07 -0.91%
Apr-07 -1.56%
May-07 -2.35%
Jun-07 -2.94%
Jul-07 -3.20%
Aug-07 -3.35%
Sep-07 -3.61%
Oct-07 -4.08%
Nov-07 -4.50%
Dec-07 -5.29%
Jan-08 -5.64%
Feb-08 -6.62%
Mar-08 -7.47%
Apr-08 -7.95%
May-08 -7.90%
Jun-08 -7.29%
Jul-08 -7.06%
Aug-08 -6.67%
Sep-08 -7.28%
Oct-08 -7.66%
Nov-08 -8.69% FURTHER FROM ZERO

Wow! And all of these numbers are undoubtably for contracts signed before the October global market implosion.

How much did they want for that HOTD yesterday?

(Team Loon)

***Bid half off peak comps***

Posted by: Brownstones Half Off at January 28, 2009 11:01 AM

I think what many people around the area have not yet realized is that the largest driver of NYC city revenue (Banking & Finance) is undergoing the most historic upheaval since the Great Depression. City revenues from the industry will be -80% or thereabouts for the next 5 years and will may not return to anything close to the mid-2000's for 10 yrs or more. Barring some kind of alternative industrial renaissance in the 5 Boroughs we are looking at a major retrenchment of city services and possible relapse of the 1970's city bankruptcy (albeit under different circumstancses). This is not a doomsday scenario, this is the realistic outlook that dare not speak its name. If you think that bodes well in any way for NYC real estate prices, well then I'd like to understand your reasoning?

Posted by: martis at January 28, 2009 11:03 AM

I guess this puts me in Team Loon.

Posted by: martis at January 28, 2009 11:07 AM

"Barring some kind of alternative industrial renaissance in the 5 Boroughs we are looking at a major retrenchment of city services and possible relapse of the 1970's city bankruptcy"

I hear greenpoint has reopened the wooden shipbuilding yard and Red Hook is going back to making coal gas.

Posted by: dittoburg at January 28, 2009 11:12 AM

Christopher: Yes, the U.S. has come through some very bad economic times in the past and there's a very high probability it will again. But you're "sure we'll get through this as well"? I'm not being sarcastic or snarky when I say, may I ask why?
Just because the U.S. has been the world's primary economic and political power for the past 100 years, doesn't mean it will be so forever, despite the nonsense that Bush and Obama said about us being Jesus' favorites or something like that...

Posted by: greenwood at January 28, 2009 11:17 AM

another week, another round of "confounding level of supidity" comments from dibs. A report of the "worst month ever" and dibs is proclaiming "no problem". Lol you can't make this stuff up. Dibs, Nov in case you forgot was the very beginning of this nyc crisis. hhaaahhaa what an idiot. I guess, we should just expect this from him. After all he did speculate in the ghetto. Oh, when Sebb makes a guest appearance and proclaims "Outlook is bright from here on" you know we've got something special going on in this thread.

Posted by: cornerbodega at January 28, 2009 11:24 AM

We're Jesuses faves? ahhhhh.

Posted by: dittoburg at January 28, 2009 11:30 AM

dittoburg ... that was awesome.

Posted by: martis at January 28, 2009 11:30 AM

This is good news for the NYC economy. It's all about moving forward now to diversify our economy. Not talking endlessly about how it's the freakin end of the world. We know...things suck. Talking about the end of Wall Street is so 2008.

http://artsbeat.blogs.nytimes.com/2009/01/27/study-says-film-subsidies-create-jobs-in-new-york/?scp=2&sq=film&st=cse

Posted by: 11217 at January 28, 2009 11:34 AM

"Note to Team Bear: Leave this alone and let the dumbasses keep going..."

I just can't. The pleasure principle is just too intense.

"Off 8.6% year-over-year. That's less that the typical "10% off of ask" that would be normal for a buyer to offer a seller; in normal times I might add!!"

Cute, but the index is down -13% from the peak and staring into the abyss as the majority of the contracts were undoubtably signed before Black October. Potential asshats are now smart enough to bid where they think comps are going, not where they are (quarterback style).

"No problem here folks, just keep on walking."

That's what I say. Underwater on your mortgage and can't pay it? Just walk away. Problem solved.

"This too shall pass.."

Absolutely. We eventually made it out of The Great Depression. We can make it out of a 50 percent price collapse.

"If you look at recent closings we are holding our own."

The successful sellers are holding their own. You're holding a bag.

"dwindling volume of homes for sale"

Not true, college kid. It's the volume of sales that is dwindling. Inventory is mounting. Get it right. Unemployed, insolvent "owners" can remain in NYC/Brooklyn all they want. That doesn't necessarily mean they remain "owners". Homework assignment: The Great Depression.

"Who will be left to run these companies back to success?"

Which companies are left?

"Soon enough, asshats in Prada will double-park their Hummers on Avenue B again."

Asshats in Conway double-parking shopping carts on Ave U.

"More thoughtful spending and saving is always a good thing...."

Not for current home prices.

***Bid half off peak comps***

Posted by: Brownstones Half Off at January 28, 2009 11:40 AM

The year = 1982.

30% Mortgage Rates peak a 17.6% (no typo.

Unemployment = 10.8%.

NYC Murders = 2,013.

Now that was a tough year.

Posted by: Boerum Hill at January 28, 2009 11:41 AM

"Note to Team Bear: Leave this alone and let the dumbasses keep going..."

I just can't. The pleasure principle is just too intense.

ROTFLMMFAO!!!!! Yeah Bho it feels good! Plus that was a Hard Core PWNING! Way to go!

The What (Obama will save us..)

Someday this war is gonna end..

Hiya Dave, where are you?

Posted by: Return of The What at January 28, 2009 11:45 AM

BHO, cornerbodega, it's always delightful to hear such factual arguments from the both of you.

The two of you wouldn't have anything that you could even post were it not for what you take from the What.

Posted by: daveinbedstuy at January 28, 2009 11:47 AM

I think Yngrtr made the most salient point in this debate. Let me make a few observations about the NYC housing market:

-I am 99% sure that we can all agree that housing markets are local/regional, so let's look at it that way.

-Noting that housing is a regional market, my claim is that the collapse of housing prices in markets like Florida, California and Phoenix are not relevant to the NYC market. The reason is that those bubbles collapsed because of an oversupply situation, fueled by all the culprits we know well: speculation, flipping and cheap credit. I remember going to Miami 3 years ago and being astouded at the number of condo towers going up - far higher than NYC. My contention is that NYC did not suffer from an oversupply bubble. If you look at the years around 2005-2006, NYC was adding about 30-40K units of housing a year in new construction, which represents about 1% of the existing h stock, and doesn't take into consideration the fact that some older units are removed from the market due to deterioration. NYC's cumbersome regulations prevented a rapid increase in the housing stock.

-Even though I am on Team Bull, I have previously defined what I meant by that, and it is that the average SELLING price of homes will decline by about 20% or less (forget the nonsense of asking price - delusional sellers can ask whatever they want). In the last deep real estate recession of NYC in 1988, the decline in ASP was about 20%, and I predict it will happen again.

-As opposed to the other markets I cited above, NYC's real-estate recession will be lead by weakness on the demand side,specifically, the reduced income on Wall Street. This is a significant factor, that is not to be ignored. HOWEVER, I go to Yngrtr's point and state that there is no evidence of a decline in the demand for housing in NYC. People are not fleeing the city, as happened in the bad old days. There is a much higher commitment to urban living now than when I was a boy 40 years ago. NOTE that even though some condos have not been able to sell, these developers have been able to readily rent them out. The vacancy rate of owned or rented units is still low.

In summary, I believe that NYC faces neither an over-supply situation or decline in demand. What it is facing is a reduced income level, and for that reason, I believe that the overall reduction in the ASP will be on the order of 20%.

My two cents!

Posted by: benson at January 28, 2009 11:51 AM

Here at the hedge fund, What. No implosion, no more withdrawals, money actually trickling in.

Your view of reality just isn't so.

Sorry I'm not going to see what the showers are like at the Correctional Facility. I'll defer to your experiences..

I bet cornerbodega has had a "book and case number" in the past too.

Posted by: daveinbedstuy at January 28, 2009 11:53 AM

"This is good news for the NYC economy."

And good news must be celebrated by those who think this is good news.

"It's all about moving forward now to diversify our economy. Not talking endlessly about how it's the freakin end of the world. We know...things suck. Talking about the end of Wall Street is so 2008."

We cannot move forward until we take our proverbial medicine. You cannot solve a problem until the problem is recognized and defined. People like dave, sebb and others DO NOT know that things suck. And people on Wall St and in Wasington do not want to the losses properly accounted for. That's part of the problem statement. We're still stuck in 2008.

***Bid half off peak comps***

Posted by: Brownstones Half Off at January 28, 2009 11:55 AM

"The two of you wouldn't have anything that you could even post were it not for what you take from the What."

The What started the Case-Killa Index???!!! Yo What! Why are you so modest? You gotta tell me these things.

***Bid half off peak comps***

Posted by: Brownstones Half Off at January 28, 2009 12:00 PM

I agree with Benson. Do I have to pick an outfit for team Bear or team Bull? I feel a bit boring wearing the same team Reason sweater.
I just wanted to add another penny to your 2 cents: although we didn't see the extreme madness in lending or speculating in NYC that occurred in Miami or Las Vegas, to name 2 stupid markets, it did happen in pockets. The post above about the Cherry Hill condos made me roll my eyes inward. Crappy layouts, ridiculous prices. It's hard to believe they really listed that converted 1 bedroom plus basement over a million dollars.

Posted by: Maly at January 28, 2009 12:02 PM

"My two cents!"

I wouldn't give you a red cent for that argument. Deny inventory all you want. Conversions, rather than land development, count. And Wall St can now be named after the Berlin Wall.

***Bid half off peak comps***

Posted by: Brownstones Half Off at January 28, 2009 12:05 PM

"The What started the Case-Killa Index???!!! Yo What! Why are you so modest? You gotta tell me these things."

Yep it's my fault.

Hey that a look at this story...

This is one of the main reason I wage war with you MOFO because Covert Class/Race warfare if uncheck can lead to some bad things. Jon you fit into the same mode as the Assheads and I wish I can see him on the street! I think his business gets slammed for this!

Shame, Shame, Shame:
Racist Cookies in
'Honor' of Barack Obama

http://www.myfoxny.com/dpp/news/090122_Racist_Cookies_in_Honor_of_Barack_Obama

MYFOXNY.COM - "Shocking," "appalling," and "racist": These are just some of the words used to describe what's for sale at a well-known bakery in Greenwich Village. While much of America celebrated Barack Obama's inauguration, Fox 5's Arnold Diaz found that this bakery marked the occasion with a controversial cookie that the owner calls a "drunken negro face." Watch Arnold's report, read his blog, and then comment on the story.

This is why The What exists...

The What

Someday this war is gonna end...

Posted by: Return of The What at January 28, 2009 12:07 PM

BHO;

Rather than slinging pithy remarks back and forth, can we have a debate?

Do you have any statistics that the vacancy rate in NYC (of both owned and rented units) is climbing? Can you please present these statistics, and their sources?

Posted by: benson at January 28, 2009 12:08 PM

What...I told you on the open thread that you bring up the race crap, not Jon and everybody is tired of it.

Take it to curbed or somewhere where you can easily incite the pseudo-intellectual loons like yourself.

We're all tired of it here.

Go have a talk with the guy at the bakery if you're so worked up about it. Maybe you'll get a baseball bat to the head down there.

Posted by: daveinbedstuy at January 28, 2009 12:13 PM

"The pleasure principle is just too intense."

From a psychological standpoint this makes you a sadist.

Posted by: wasder at January 28, 2009 12:14 PM

"Rather than slinging pithy remarks back and forth, can we have a debate?"

Yeah, you're right Benson. My last comment was more for fun (the whole $.02 thing, I just couldn't resist). Your comment was very intelligent and respectful. But I don't know if I have time for a statistical laden debate. But I'll try. Maybe tonight.

***Bid half off peak comps***

Posted by: Brownstones Half Off at January 28, 2009 12:22 PM

I agree with Benson. Suprise, surprise.

Posted by: 11217 at January 28, 2009 12:26 PM

> "I hear greenpoint has reopened the wooden shipbuilding yard and Red Hook is going back to making coal gas."

That's a sweet chunk of snarky goodness, ditto.

Posted by: SnarkSlope at January 28, 2009 12:38 PM

Brother Bulls/Brother Bears,

I enjoy watching these exchanges as much as the usual suspects obviously enjoy participating in them, but come on. Seems to me the truth of the matter is that - other than the apparent agreement of everyone on this site that the Brooklyn market is going to experience a mild-to-moderate correction in the next year - nobody knows what's going to happen.

Team Bull assumes that Brooklyn's underlying fundamentals are sound. This may well be correct for some neighborhoods of the borough; less correct (possibly much less correct) for others. I can understand how the pretty consistent refusal of some Bulls to acknowledge this (combined with a penchant for conveniently biased boosterism) drives the Bears insane.

Team Bear (many of whom seem to have some convenient biases of their own) assumes that we're on the threshold of something truly ahistoric and cataclysmic. (Begin stockpiling canned goods and firearms!) Possibly so. But at the end of the day, that's pure speculation on their part.

My own view is in the middle. I think that this is going to be something more than an everyday correction and, in some neighborhhods, is going to feel like much more than an everyday correction. But at the end of the day, I have no idea what's going to happen.

And, near as I can tell, neither does anybody else that posts on this site.

The whole dialogue would certainly be helped by less boosterism from the Bulls (that goes for the site's editor too), less gloating from the Bears and a lot less certitude by all involved.

My $0.02 from the luxurious sidelines.

Posted by: ajaxclorox at January 28, 2009 1:20 PM

Ajax--well said. Although the nature of the beast with a site like this is to talk through your asshole as if you have some special insight. You are absolutely correct that nobody on either side of this debate has any way of knowing if they are right.

Posted by: wasder at January 28, 2009 1:33 PM

Ajax, of course most of these regulars don't know what's going to happen. That's why they are here slinging mud at each other -- insecurity and fear that what they hope will happen might not happen, and an absurd hope that if they browbeat the other side into submission perhaps the outcome will be as they hope.

I feel quite certain about the outcome, and for the most part I stay out of these debates. I have made my bet, and now I am waiting until it pays off. In the meantime I don't see any point in getting in a slapfight with anyone about it.

Posted by: lechacal at January 28, 2009 1:37 PM

Speaking of slapgfights, did we lose Miss Muffet?

Posted by: SnarkSlope at January 28, 2009 1:41 PM

What do you think the outcome is lechacal?

Posted by: 11217 at January 28, 2009 1:41 PM

Yes, lechacal. If you're "quite certain" of the outcome, please let us in on it.

Posted by: daveinbedstuy at January 28, 2009 1:48 PM

yeah, lechacal, without a slapfight, what is your prediction?

Posted by: wasder at January 28, 2009 1:56 PM

I'm sure I have posted my views several times before, but I guess I haven't repeated them enough to gain muffetesque notoriety. I sold in fall 2007 and now rent and wait to buy again. The short version is that prices will come down substantially in the next few years. Park Slope (my focus) will do meaningfully better than Manhattan but all NYC markets will come down substantially. I'm not sure exactly when the right time will be to buy, but I will know it when I see it.

Posted by: lechacal at January 28, 2009 1:57 PM

Right on. Why will PS do better than Manhattan?

Posted by: wasder at January 28, 2009 1:59 PM

Park Slope prices will hold up better than Manhattan prices in the next few years because Park Slope is hot. If I had a dollar for every one of my Manhattan friends who is considering a move to the slope I would almost as many dollars as friends, and could treat myself to a cappuccino or a small frozen yoghurt. PS isn't hot enough to avoid a big drop in prices, but it's hot enough to do comparatively better than some of soulless, grotesquely overpriced stuff I see in Manhattan (new condos in Tribeca, just for example). But as my banker friends say, you can't eat comparative returns, and thus here I sit on the sidelines, clutching a few hundred thousand in down payment money and patiently waiting.

Posted by: lechacal at January 28, 2009 2:06 PM

"Right on. Why will PS do better than Manhattan?"

Surely you know PS is the center of western civilization. Easy access to Prospect Park, wonderful architecture, steps away from the Q train. The restaurants on 5th avenue are second to none, and there are enough bars to sustain slopers favorite hobby, binge drinking. Everyone that lives there loves it, and everyone who doesn't wishes they could live there. Buy now or be priced out forever.

Posted by: dirty_hipster at January 28, 2009 2:08 PM

Lechacal,

I can count at least 8 people I know also looking to leave Manhattan for a move to the Slope.

I have 5 friends who have bought or rented here since I left Manhattan in 2006 and moved to Park Slope. They had never been...came to see my place and moved.

I was really lucky and formed a really terrific group of friends within the first year of moving to NYC, and we ALL used to live in Manhattan back in the day (2000-2005) and every single friend of mine (but 1) has since moved to Brooklyn.

Not all Park Slope, of course, but it gives you a sense of the changes that have taken place in the last decade. They all feel like I do in the sense that they want to stay in NYC long term but have zero desire to move back to Manhattan.

Posted by: 11217 at January 28, 2009 2:13 PM

Honestly dirty hipster...no one is saying that everyone loves Park Slope except you. I don't understand why anytime someone brings it up, you have a sarcastic remark to say. It makes no sense. If you hate Park Slope, that's great. But why do you feel a need to make the same snarky remarks about it?

Posted by: 11217 at January 28, 2009 2:15 PM

I've already stated before I like park slope - but if someone could please provide me some real reasons that it will fare better then the rest of brownstone brooklyn or manhattan real estate in the current economic climate other then pure speculation and the fact that 8 people from manhattan moved there then please go ahead.

Posted by: dirty_hipster at January 28, 2009 2:19 PM

Actually the same thing will be true of Bed Stuy in about 3-4 years. And then I won't be the stupid underwater Asshat that bought at the yop for a quick flip that you all know and love.

Posted by: daveinbedstuy at January 28, 2009 2:22 PM

dirty hipster - I don't think I can quote figures or statistics, if that's what you are looking for. If you moved a lot in social circles that include lots of potential buyers, then you would probably understand. It's intangible. I guess you'll just have to take my word for it. Or don't. I frankly don't give a wet slap either way.

Posted by: lechacal at January 28, 2009 2:26 PM

There are no reasons, dirty hipster. As someone said here today, everyone is speculating. No one has any idea what's going to happen with any certainty. There are people like me and lechacal who like Park Slope and think it will do well, and there are others who don't. They are opinions at this stage of the game.

Personally I've always found lechacal's posts quite informative and intelligent, and clearly I'm not the only person here who knows of a bunch of people who have moved to the hood. These are just anecdotes, sure...but enough anecdotes add up to a hunch, perhaps.

Posted by: 11217 at January 28, 2009 2:27 PM

lechacal--good to see you. you should stop by more often.

Posted by: wasder at January 28, 2009 2:39 PM

Thanks wasder. I was busy for a while, now I'm in real estate hibernation (stopped going to open houses for the next 6 months at least) so I haven't been showing Brownstoner as much love as I used to.

When is everyone meeting for drinks again? I say impromptu cocktails at Union Hall tomorrow evening if someone else is willing to organize.

Posted by: lechacal at January 28, 2009 2:44 PM

Fair enough fellas. I understand that you both live there and love it and have a financial stake in what happens to your home values - but to state that PS will hold up better then other Brownstone Brooklyn neighborhoods such as Carrol Gardens, Brooklyn Heights or even Manhattan. I just don't buy it and interpet it as just boosting up your own neighborhood and will respond as such.

That said - I love you guys and feel free in six months if you're right to (justifiably) call me an idiot.

Posted by: dirty_hipster at January 28, 2009 2:45 PM

lechacal--looks like there is a brownstoner drinks shaping up for March, location TBD. Stay tuned. I'm going to DC tomorrow so I'm out on that front.

dirty hipster--good attitude. hold a position but be cool if you are wrong. always good policy. I am not a park sloper so I have anecdotal evidence to share on you guys' disagreement. I would say that it would surprise me if PS fared better than Manhattan though, just as a matter of historical common sense.

Posted by: wasder at January 28, 2009 2:50 PM

meant to say I don't have anecdotal evidence...

Posted by: wasder at January 28, 2009 2:53 PM

"As someone said here today, everyone is speculating. No one has any idea what's going to happen with any certainty. There are people like me and lechacal who like Park Slope and think it will do well, and there are others who don't. They are opinions at this stage of the game."

11217 is the zip code for the ghetto Asshead! I know your broke ass wish you could live in Park Slope ; ^ P--

Here retards suck on this!

http://www.federalreserve.gov/newsevents/press/monetary/20090128a.htm

Press Release

Release Date: January 28, 2009

The Federal Open Market Committee decided today to keep its target range for the federal funds rate at 0 to 1/4 percent. The Committee continues to anticipate that economic conditions are likely to warrant exceptionally low levels of the federal funds rate for some time.

The Bond market is still in a bubble and remember the FED follows the market, not the other way around!

"Information received since the Committee met in December suggests that the economy has weakened further. Industrial production, housing starts, and employment have continued to decline steeply, as consumers and businesses have cut back spending. Furthermore, global demand appears to be slowing significantly. Conditions in some financial markets have improved, in part reflecting government efforts to provide liquidity and strengthen financial institutions; nevertheless, credit conditions for households and firms remain extremely tight. The Committee anticipates that a gradual recovery in economic activity will begin later this year, but the downside risks to that outlook are significant."

You retarded basters should read this paragraph over and over again. If it was not for the Government efforts to prop up the financial markets 2008 would have marked the beginning of the great Depression 2. When the US cannot sell it's debt any more your Brownstone will lose it's value overnight! When the world says "That's enough" that will be the end of the MAB.

Now you can continue circle jerking one another..

The What

Someday this war is gonna end...

Posted by: Return of The What at January 28, 2009 2:54 PM

My neighborhood "boosting" is done out of pure love of my neighborhood and community. As I've said before, I really have no concerns over the future short term losses on the value of my home because I have no intention of leaving it. In fact, I hope prices do go down, because I'd like to see a more diverse group of people be able to access these neighborhoods.

And for the record, I love all the brownstone neighborhoods as well as Dumbo. Each have terrific qualities and it's easy to see why people choose them all.

Every year I'm exploring new areas of Brooklyn outside of the Brownstone area, and last summer went to Victorian Flatbush and Ditmas Park for the first time. Also beautiful.

This spring, I want to go explore the area around Brooklyn College more. I've been there back in 2001, but haven't really been back since.

And I LOVE Coney Island. The roller coaster is a blast.

Posted by: 11217 at January 28, 2009 2:54 PM

"Now you can continue circle jerking one another.."

Jealous What?

Posted by: dirty_hipster at January 28, 2009 2:59 PM

Haha the Cyclone - I won't ride that anymore after I heard about that guy who died after cracking three vertabrae.

Posted by: dirty_hipster at January 28, 2009 3:00 PM

Yeah, more than one person has died on it over the years, I believe.

It's a great one though. And I'm usually a little "hazy" when I go also...if you know what I mean...

Makes it easy to forget...

;-)

Posted by: 11217 at January 28, 2009 3:06 PM

To Lechal and others who are timing the real estate market -don't forget to incorporate all the transactions costs involved with getting into and out of NYC real estate. When you buy, transaction costs (title insurance, mortgage recording fees, mansion tax, bank fees, your lawyer etc) are significant. In my case, they were 5%-6% of the purchase price. I've never sold a house, but guess that when you do sell you've got the broker fee, the transfer tax, your lawyer etc. Figure another 5%-6%. If you're planning to live someplace in between, you've got to pay a broker fee for your rental apartment. You also have to pack up and move twice. If you sell a house for $1.0 million, your going to have to buy your next house at a 15% discount just to break even.

Posted by: Boerum Hill at January 28, 2009 3:13 PM

Re: ajaxclorox at January 28, 2009 1:20 PM

QOTD guaranteed. Not that I'm gonna stop gloating though.

***Bid half off peak comps***

Posted by: Brownstones Half Off at January 28, 2009 3:13 PM

BH: I was selling anyways for various reasons and was confronted with a choice as to whether to buy again or wait. I decided to rent and wait. I paid a sum total of about $5k in fees to rent my place a year and a half ago. The after-tax difference in what it costs to rent my place compared to all-in cost of ownership if I had bought in 2007 is about $2,000 a month. And I estimate that at this point I could probably save about $200,000 on purchase price as compared to what I would have spent in 2007.

I am nothing if not absolutely obsessive about numbers and finanical decisions. I very, very carefully thought about this one, and thus far I am pleased with the result and am well in the green.

Posted by: lechacal at January 28, 2009 3:22 PM

If you mean what I think you mean by hazy then I suppose we have at least one thing in common. ha

Posted by: dirty_hipster at January 28, 2009 3:24 PM

"Not that I'm gonna stop gloating though." REspectfully, why not? If that quote you cited was QOTD you must believe to an extent that there is something to the "we are all talking out of our ass" aspect of all of this. Why gloat about something that may not turn out the way you think it will?

Posted by: wasder at January 28, 2009 3:27 PM

"If you mean what I think you mean by hazy then I suppose we have at least one thing in common. ha"

I also have gotten really stoned and ridden the Cyclone.

Posted by: wasder at January 28, 2009 3:30 PM

I think ajaxclorox @ 1:20 is a great QOTD. The problem is if these differences didn't exist and we weren't all so vocal about them there wouldn't be a discussion here and there'd be no traffic and there'd be no advertising dollars and then the site would shut down.

Posted by: daveinbedstuy at January 28, 2009 3:32 PM

DIBS---you are probably right.

Posted by: wasder at January 28, 2009 3:33 PM

Sounds like a good spring time brownstoner outing.

Posted by: dirty_hipster at January 28, 2009 3:33 PM

hipster--you should come, but beware, it might be in Park Slope!

Posted by: wasder at January 28, 2009 3:41 PM

"If you mean what I think you mean by hazy then I suppose we have at least one thing in common. ha"

I suspect we have many more things in common than meets the eye...

Posted by: 11217 at January 28, 2009 3:43 PM

Hahaha!! I'll make sure to put on my stroller dodging shoes.

Posted by: dirty_hipster at January 28, 2009 3:44 PM

"Haha the Cyclone - I won't ride that anymore after I heard about that guy who died after cracking three vertabrae."

Man up, DH. The Cyclone is the BOMB, stoned or sober! It's also, along wth the Wonder Wheel one of only classic rides left standing at Coney.

Posted by: East New York at January 28, 2009 3:45 PM

Well in my defense last time I was @ Coney Island I rode it. I subsequently found out about the dead dude.

It's so much better riding it in the back. you REALLY get whipped around.

Posted by: dirty_hipster at January 28, 2009 3:50 PM

"hipster--you should come, but beware, it might be in Park Slope!"

Nope, wasder. Been there, done that. Will be in BoCoCa, just so we can drive everyone crazy using that acronym! Actually, it's looking like it will likely be at Floyd NYC on March 19. Details to follow...

Posted by: Biff Champion at January 28, 2009 3:59 PM

11217, please don't respond to that. Please.

Posted by: lechacal at January 28, 2009 3:59 PM

Lechal,

I didn't intend to give offense and hope none was taken. The transactions costs associated with real estate are ridiculous in NYC and I don't think people always plan for it. It makes an illiquid asset even more illiquid. I've purchased real estate in other jursidictions (another country) and the transactions costs were so much smaller.

I bought my house in the summer of 2003 and don't know if it's worth more or less than I paid for it. My guess is its value is about the same. For now, it really doesn't matter. I can afford the payments and plan to live there another 25+ years. If I couldn't make the payments, I'm pretty sure I could rent the place for an amount that would service the mortgage. Either way, I'd expect to own an asset free + clear at some point 15-20 years down the road.

I think that's the type of time frame you need to look at if you're going to own real estate.

Posted by: Boerum Hill at January 28, 2009 3:59 PM

You sound cute, DH.

Posted by: 11217 at January 28, 2009 4:00 PM

Whoops!!

Posted by: dirty_hipster at January 28, 2009 4:12 PM

Floyd's is fun!

Posted by: 11217 at January 28, 2009 4:17 PM

Isn't Floyd's the bar where the owner sits on the community board and tried to get union hall's liquor license revoked by the SLA?

Posted by: dirty_hipster at January 28, 2009 4:20 PM

11217, perhaps you can mingle with dirty hipster during a game of bocce.

Posted by: Biff Champion at January 28, 2009 4:20 PM

Awk. Ward.

Posted by: SnarkSlope at January 28, 2009 4:21 PM

I think that was Brazen Head bar, dirty hipster.

I thought Floyd's was owned by the same people who own Union Hall (sight of the last bstoner meet-up).

Not sure, though...

Posted by: 11217 at January 28, 2009 4:22 PM

I mean site.

Posted by: 11217 at January 28, 2009 4:23 PM

Yeah that's right - the brazen head guy went after Union Hall because Floyd is a competitor to brazen head.

Posted by: dirty_hipster at January 28, 2009 4:23 PM

I was at Union Hall on Sat. It was jam-packed!

Could barely move around in there!!

Posted by: 11217 at January 28, 2009 4:27 PM

"...It was jam-packed!"

with binge drinking brownstone dwellers!

Posted by: dirty_hipster at January 28, 2009 4:33 PM

"Yeah that's right - the brazen head guy went after Union Hall because Floyd is a competitor to brazen head."

Wow, what irony then in having the first gathering at Union Hall and the next one at Floyd. Is that irony or just a coincidence? I could never figure out the difference.

Posted by: Biff Champion at January 28, 2009 4:35 PM

I think "binge drinking" is technically like 4 drinks for a male in one night or something, so yeah, we all binged.

Posted by: 11217 at January 28, 2009 4:37 PM

That is strange Biff - it might be more of a testament to the owners running good establishments. I don't frequent the BoCoCa bars but if you guys want some fancy cocktails Clover Club on Smith is great.

Posted by: dirty_hipster at January 28, 2009 4:43 PM

Biff,

Did Floyd's used to be that gay bar called "Friends" I think it was called?

Have you lived in BH long enough to remember that place?

Posted by: 11217 at January 28, 2009 4:44 PM

4 drinks is considered a binge? Do shots of Jameson count? I mean, they are smaller then a regular drink right?

Posted by: dirty_hipster at January 28, 2009 4:45 PM

DH,

My drink of choice is Jameson and gingerale.

See...I told you we have more in common than you probably thought.

Shots work too...

Posted by: 11217 at January 28, 2009 4:47 PM

***There is currently no international consensus on how many drinks constitute a "binge," but the term is often taken to mean consuming 5 or more standard American drinks (male), or 4 or more drinks (female), in about for a typical adult.

5 drinks...I was off by one...

Posted by: 11217 at January 28, 2009 4:47 PM

haha nice - but i'm still gonna bust your chops about park slope 11217 ;)

Posted by: dirty_hipster at January 28, 2009 4:49 PM

Bust away...I can take it.

(Get your mind out of the gutter lechacal).

Posted by: 11217 at January 28, 2009 4:51 PM

haha, oh how i enjoy innuendo

Posted by: dirty_hipster at January 28, 2009 4:53 PM

"If that quote you cited was QOTD you must believe to an extent that there is something to the 'we are all talking out of our ass' aspect of all of this."

Bad assumption. I was playing brownstoner's advocate. I think that most of what I say has an eery reality to it, not a farty smell.

***Bid half off peak comps***

Posted by: Brownstones Half Off at January 28, 2009 4:55 PM

"Did Floyd's used to be that gay bar called "Friends" I think it was called? Have you lived in BH long enough to remember that place?"

11217, I'm not sure. I've only been in BH just under two years.

Posted by: Biff Champion at January 28, 2009 5:15 PM

I was at Union Hall (briefly) on Saturday night as well. My brother was in town and literally - I kid you not, he lives in Massachusetts and hears about Brooklyn hipsterdom secondhand - wanted to go to a hipster hangout for a few drinks "you know, just to see". Meanwhile I'm more or less the anti-hipster, suit-wearing thirty something year old working stiff, but I said sure and took him to Union Hall. Of course someone had issued a memo to the entire hipster community announcing either (1) that hipsters may no longer be seen at Union Hall or (2) that hipsters are now so ironic that they dress like preppies without a hint of irony, which is the ultimate irony. I had to tell my brother that our wildlife watching expedition was a failure and go home for big glasses of Jameson (seriously) and Family Guy reruns.

Posted by: lechacal at January 28, 2009 5:28 PM

"I think that most of what I say has an eery reality to it, not a farty smell." Believe me I understand that you buy your own hype. This has never been in doubt. IMHO you are easily the most egotistical poster on this board.

Though the farty smell thing in response to my "talking out of the ass" was a nice rejoinder.

Posted by: wasder at January 28, 2009 5:37 PM

With all due respect to my pal lechacal, I am unsure if Union Hall was ever really a "hipster" destination in the truest sense of the word.

Posted by: wasder at January 28, 2009 5:38 PM

Greenwood you said "Yes, the U.S. has come through some very bad economic times in the past and there's a very high probability it will again. But you're "sure we'll get through this as well"? I'm not being sarcastic or snarky when I say, may I ask why?
Just because the U.S. has been the world's primary economic and political power for the past 100 years, doesn't mean it will be so forever, despite the nonsense that Bush and Obama said about us being Jesus' favorites or something like that..."

I never said we would always be the primary economic and political power, I just said that this downturn will level off, things will maintain for a while, and eventually there will be an upswing. It will happen. Always does...

The only way a turnaround wont happen is if people stop working, stop trying to look for work, stop trying to improve their lives, on so on. It wont happen if the masses sit back and wait for a govt check and have no desire to ever get past a handout. As long as there is a determination to improve, a work ethic, and a desire to be independent, and pride in personal success this country will always survive and will always rebound.

Posted by: christopher at January 28, 2009 5:42 PM

Was union hall ever a hipster hangout? i think you might of had it confused with union pool lech.

Posted by: dirty_hipster at January 28, 2009 5:51 PM

Lechacal,

As Wasder says, Union Hall has never been a "hipster" hang out." It's been preppy guys and gals since it opened.

The "hipster" places in the neighborhood are Commonwealth, Buttermilk, Pacific Standard, 4th Avenue Pub, Bar 4, Sheep Station, Barbes, Alchemy...and to a lesser extent Cherry Tree Bar, Flatbush Farm (Barn) and Bar Reis.

Definitely NOT Union Hall. In the summer there are a few more "hipster" types, but winters are filled with the Yale graduates and such. I was there with my straight female friend from out of town and it was much more her "scene" than mine.

Posted by: 11217 at January 28, 2009 5:56 PM

I think I'm single-handedly keeping 7th Avenue Wine and Liquors opened with my Jameson purchases.

Posted by: 11217 at January 28, 2009 6:01 PM

"IMHO you are easily the most egotistical poster on this board."

I'm a victim of my own success. The whole DOW8000SP800 thing went to my head. Please Lord, let me be wrong about home prices! I HATE THIS PERSONALITY!!!

***Bid half off peak comps***

Posted by: Brownstones Half Off at January 28, 2009 6:05 PM

There are hipsters in Park Slope?

Posted by: mopar at January 28, 2009 6:37 PM

You see, this is the problem. As a working stiff parent type I no longer get these memos. Maybe I don't even know what a hipster is (although just in case I leer at anyone with a bowler hat and an eating disorder).

Posted by: lechacal at January 28, 2009 6:50 PM

"The whole DOW8000SP800 thing went to my head." That was good. I gave you props for that at the time.

Posted by: wasder at January 28, 2009 10:43 PM

Christopher:
You're entitled to your opinion but I still don't agree with "eventually there will be an upswing. It will happen. Always does..." Again, it's very likely you're right, but as the old brokerage commercials used to say "past earnings are no guarantee of future returns."
By citing US dominance for the last 100 years, I meant to suggest that this is a very, very young country--our entire history is a drop in the bucket compared to other past economic superpowers. Many of them lasted a lot longer than ours has so far, and some went from the dominant economic force to nearly Third World economies. I'm not saying that's going to happen to us, but it's not impossible.

Posted by: greenwood at January 29, 2009 10:03 AM

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