We don’t usually get around to the Op Ed page ’til later in the day so we missed Krugman’s piece yesterday on everybody’s favorite topic, the housing bubble. Among the signs he points to that the bubble is already losing air are:

  • The bubble doesn’t burst with a bang–inventory builds as sellers hold out for high prices that buyers are no longer willing to pay.
  • Looking at national averages is irrelevant since buildable land is still plentiful in non-coastal areas.
  • In New York, Miami and San Diego, prices rose 77, 96 and 118 percent, respectively, between 200 and 1Q 2005.
  • In San Diego, the number of single-family houses on the market has doubled over the past year.
  • Many people have already pulled equity out of their houses and the personal savings rate has fallen to zero.
  • Is there any hard evidence that properties in New York are sitting on the market for longer?
    That Hissing Sound [NY Times]


    What's Your Take? Leave a Comment

    Leave a Reply

    1. “And don’t you feel like the ‘when are you finally going to buy’ is the new ‘so, when are you having kids?’ People are unbelievable!”

      Totally, completely, 100% agree!

      The wincing pain is even worse, because my husband and I just celebrated our first wedding anniversary. We get BOTH questions on a regular basis. I think my forehead has a dent in it from banging my head against the desk! 🙂

    2. Ha! Wannabe, whine all you want – I feel your pain. My husband and I have also talked about leaving NYC and I don’t want to hear squat from anyone that I don’t love NYC enough, etc. Those comments are stupid. You have your priorities straight – be happy about it and forget what anyone says.

      And don’t you feel like the “when are you finally going to buy” is the new “so, when are you having kids?” People are unbelievable!

    3. You see, I’m not entirely sure that we *have* given up yet. we keep checking out new neighborhoods, hoping to find one that we like enough to buy in. It’s tough, especially when everyone keeps asking, “so, when are you going to finally buy something?”. At this point, I suspect it’s going to be a 2BR co-op somewhere like Ditmas Park, Riverdale, or Jackson Heights… or finding jobs elsewhere and moving to another part of the country.

      (This is where people start harshing on me, stating that people like me should leave because we’re ingrates and obviously don’t love NYC enough. I’ll likely stop replying after this response, as I’m sure most are bored with my all-too-common whining. My apologies.)

    4. wannabee- just keep socking away your money, take a vacation or two in the meantime — enjoy life for now! it will def happen for you. you should be congratulated for not putting yourself in a bad situation (like anon’s friend with the huge ARM) and not giving in to the hype.

    5. Wannabe,

      Good for you for knowing what you’re willing to do, and accepting the consequences. Basically what you’re describing is a situation that — even during a much cooler housing market — is much more typical of a heartland suburb than NYC. It just doesn’t follow that, because you can’t afford the house of your choice under your parameters, that there must therefore be something really wrong with the NYC market.

      (There may BE something really wrong with the NYC market — but not for that reason.) Good luck.

    6. “The average household income in New York (depending on who you ask) is about $70,000 and the average house value is about $400,000. So that gives you an E/V ratio of about 5.7.”

      I think the easiest way of explaining my dilemma is to state that my husband and I are only truly comfortable with a ratio of about 2.75-3.

      Er… I guess we’re just going to have to suffer.

      (We have thought of going the 2-3 family route, but the husband doesn’t want to be a landlord.)

    1 5 6 7 8 9 11