Housing Crisis Will End on June 30, 2009
So says James Cramer in New York magazine this week. Prepare to break out your wallets on that date, because housing prices, he says, will bottom and it will be “the best opportunity to buy since the 19891991 real-estate crash.” He gives 10 reasons why, including the eventually evening out of supply and demand; the…
So says James Cramer in New York magazine this week. Prepare to break out your wallets on that date, because housing prices, he says, will bottom and it will be “the best opportunity to buy since the 19891991 real-estate crash.” He gives 10 reasons why, including the eventually evening out of supply and demand; the $300 billion mortgage relief legislation, turning high-interest mortgages into more modest, 30-year versions; prices lowering so much in some areas that buyers won’t be able to resist; and the slow bottoming out of New York City. Immigration and population growth will play a part too, he says, and it looks to him like we hit bottom this summer and are starting on the slow road to recovery. Well, not that slow, apparently. Who out there agrees?
End of the Housing Market Free Fall [NY Magazine]
Photo by jkeys.
The What: “…911, What a joke….”
Indeed. They be laughin’ at ya while you’re crawlin on your knees.
I really don’t think NYC real estate will bottom before 2010.
I think it goes like this:
Wall Street lays off a bunch of people in 2007/2008.
Wall Street hires fewer people in 2008/2009.
Wall Street bonuses at the end of 2009 suck.
Some people sell property because they got laid off or their bonuses suck.
Other people don’t buy property because they got laid off or their bonuses suck.
Some people look to rent a cheaper place when their lease is up because they got laid off or their bonuses suck.
Other people leave the city because they got laid off and cannot find another job.
Prices generally stagnate or drift downward for a few years (beg. in 2007).
The investment banks that are going belly up finally do so in first half of 2009.
Bottom hits sometime in late 2009/2010. Economy stabilizes (may not be great, but will be stable). Wall Street can start hiring again. Neighborhoods with good quality of life (pleasant housing, nice stores/restaurants, low levels of random street crime) see more and more buyers showing up.
Lechacal: My info is also anecdotal as well (especially with Sydney) and I don’t mean to be pig-headed about this. I would just say that for the neighborhoods that I would consider most being like Brownstone Brooklyn demographically/economically (Easter Suburbs of Sydney–Bondi, Tamarama, Clovelly, Bronte etc) people making equivalent to what my wife and I make are having a really hard time buying anything they like and are starting to venture to areas once considered unthinkable (Redfern, Western suburbs etc). And somebody who recently came to visit me from London, heard about the house I was buying and spat up with envy at the “steal” I was getting on the house we are buying. IT just feels like those cities cause folks to spend a considerably higher proportion of their income on housing. But again, this is only a sideline issue to what we are talking about and I don’t want to sound like a blowhard.
lechacal….nothing ever posted here would stand up in court, LOL, unless of course you mean the court of public opinion or the court of brownstoner posting!!!
I should probably get back to work rather than spending time mustering data to back myself up. I guess part of it depends on whether you measure absolute prices or affordability. I actually recently spent a couple of years down under and am pretty familiar with Sydney, and I’m not sure I agree that Sydney is less affordable than NYC. But that’s just personal anecdote and nothing that would stand up in court.
What, I must say I was bummed out by your 9/11 stuff yesterday. First harshing on Brownstoner for not splashing it on the front page and then calling everyone out for not responding to your Forum post. I know I did my own thing in re remembrance yesterday and I don’t think anybody needs to be guilted by you about how we remembered that day that changed everybody a little. This is a real estate blog not a geo-political one, though you seem to forget this often.
Daveinbedstuy you are 100% correct . Rents and prices in NYC are very cheap and this market has been second behind LA or San Fran for a long time in being the most expensive in the Unites States. There is no Justification for that.
Lechacal, must argue you with you. New York real estate is not expensive compared to Tokyo, London and even Sydney (where I spend a good bit of time). Everybody I know in London and Sydney are struggling to find places to live that they can afford and that meet their standard of living (ie how they themselves grew up). And they are moving to parts of London and Sydney that would be the equivalent say of Bushwick (closer to city but more rundown) or Sheepshead Bay (farther from city but more suburban) to find housing. Clearly NYC real estate is overvalued when compared to most places but compared to a few of the cities we have been discussing, NYC is not nearly as bad.
I also welcome a serious discussion on this topic though. I think if Dave, Biff, Lechacal, Dow, What and any one else with a perspective to add would just talk about this stuff without devolving into personal crap, it could be really fascinating.
lechacal…i wasn’t taking a position on how far down Manhattan properties would decline. Just stating that they were not expensive compared to the others.
Manhattan properties may be “so obviously wrong to someone who moves around a lot” within the US but not on a global scale. You don’t want to know what rents are for a decent flat in Hong Kong!!!!