Goldman: NYC Prices Have a Ways to Go
“New York apartment prices are very high relative to the observable fundamentals. Using three alternative yardsticks—price/rent, price/income, and affordability—we find that prices would need to decline by 35%-44% to return to the valuation levels seen in the 1995-1999 period, before the start of the recent boom.” — Goldman Sachs via Curbed
BH76,
Taking Dave’s comment aside, only 33% or so of New Yorker’s own their own homes. The rest rent.
In looking at data for my own zip code, it looks as though about 45% or so are married.
I believe the divorce rate has dropped significantly in the past few years, but even taking your 50% number we are talking 50% of the 45% who are married amongst the only 33% who own.
Once you factor in Dave’s comment, I think we’re really talking about 1% of the population here.
BH76…there was a story here a few weeks ago about divorces being put on hold because if they sold and split the house neither one of them could afford anything!!
I think that some of you are missing two things: people who have owned their homes/coops/condos for years may big gains but many were thinking they were sitting on retirement nest eggs that have deflated along with their 401Ks. They can afford to stay put, but not sell and move elsewhere so easily. And for those who are younger, a 50% divorce rate means that couples split and neither can afford the house/coop/condo on his own nor can he afford to buy out a spouse/partner for what is owed. This led to foreclosures last time around and will this time too I expect. It is not a pretty picture.
The properties that will get hit the hardest, and those who will lose the most, are the studios and one-bedrooms purchased from 2005 or so forward. Simple, those are generally the properties with the most necessary turnover as people get married, have children, move for career purposes etc, and need to sell. I have a friend in his mid 30s – single guy but decidedly resolved to getting married and starting a family – who closed on a one-bedroom on the UWS for around $675,000 in September. We implored with him not to – as that is the worst situation to be in; he will probably be looking to sell in three years.
cornerbodega… I came over here from manhattan, shit for brains.. How can you be so stupid day-in-and-day-out???
Keep stacking that detergent in front of those windows!!!
You guys are listening to GOLDMAN SACHS, the once mightly investment bank, erstwhile blueblood, white shoe firm, intrepid explorer into structured mortgage transactions, now 92 pound weakling commercial bank? Here’s my life in brownstone America…. Work my butt off in day job (except for occasional breaks on brownstoner), try to keep the house together, tenants warm and happy (enough), beg tradespeople to meet me when I am not working at said day job, beg said tradespeople not to soak me (it works, I have good relationships, finally, in this department) and keep laughing. AND YES, Slopefarm, lifting a glass is important. This freaking brownstone experiment is about sharing, too. After the dust settles, literally, to have friends and family enjoy the place. That is what this is about. That is what is important and why I (we) are not in the jump in front of the train set. And yes, Snark Slope, GS predicted 200, revised to 100, now looking at 75 last I heard, but all banks (and real analysts looking lower for next year 45). Ah, screw it all, I think I going to have a drink now….
“Ahhh, I see Biff beat me to the punch.”
I hope it was spiked with Pyrat XO Reserve Rum!
There is no doubt that the right person with the right set of skills and capacities can achieve great things with a fixer-upper but it sucks that you had to do it involuntarily slopefarm. May bad karma rain down on your seller and may forum posts never dampen your day ever again.
Goldman also said Oil would be at $150 right now. I like Goldman but with so many Coops in Nyc i do not see to much risk.