Last Week's Biggest Sales

Chicken: You make some valid points and I appreciate your comments.

One thing I am having a hard time understanding is this: How can houses be selling for the prices noted above (yes, back to the point of this post!) when the markets have been tightening for some time? How are these people getting the financing for this? Where is there money coming from? Didn’t banks cut back on such loans months (a year) ago?

And if I can ask you some quesitons, just to better understand your position …..

What do you think it would take to bring a sense of stability in the housing market today? Specifically the Brooklyn brownstone market. (I think there are two markets right now – e.g. Park Slope and less affluent markets.) I know that some of the loose lending practices really did a number on several less affluent areas and it will take several years for these areas to get past the recent go-go period. The foreclosures and short sales will hurt prices there over the next few years. Your thoughts?

You say that housing prices will be half what they are today. What is your basis for this and do you think that this will be true for all of brownstone Brooklyn?

Are you looking in brownstone Brooklyn to buy? If so, what area(s) and why?

Any information you are willing to share would be greatly appreciated.

thanks Wasder and 11233.

You are absolutely right – family and happiness are what is important. I work in the financial markets (small hedge fund) and I see a lot of wealthy people every day – but they are not happy. Going to work is a chore for them, they commute like zombies. They are overstressed, prematurely grey, and overweight from lack of exercise. These are people with 8, 9 or 10-digit bank accounts – wealthy enough to live out the rest of their days in paradise. That, to me, is a waste. I could make a quarter of what I earn and be just as happy to see my daughter playing on Manhattan Beach.

When I say “I am much more inclined to take What’s position based upon what I believe is important in the world right now”, I am referring to his view on house prices – ie they are going to come down hard.

The Fannie and Freddie bailouts were inevitable. The only reason the shares were trading above $1 (ballpark option value) is the lingering hope that the shareholders were still going to get a slice of the pie. Their bailout IS positive for houseprices, or at least not negative. What they are bad for though is the economy. My estimate is that the taxpayer will have to fund these entities to the tune of $1tn (that’s 12 zeros) which will get added to the country’s debt balance. So house prices won’t fall as far as they might have done otherwise but America is in a significantly weaker position. However, lending standards will be tightened considerably meaning bigger deposits and lower loan multiples.

Next up, Lehman looks like it is going under. This is the country’s fourth largest investment bank. Having seen what has happened to their share price, would you want to deal with them (as a counterparty)? Would a hedge fund want to have them as their prime broker? Banking is a confidence game and when that confidence is gone the game is over. This is exactly what happened with Bear Stearns and exactly what I think will happen to two other big-name investment banks (I won’t name them. I’ve got short positions and I believe my thesis will come to fruition without any cheerleading on my part).

Finally, financial services represents a huge chunk of New York’s economy. Slash that in half (or more) and you’ve got a dearth of buyers. To get a deal you need to have the buyer and the seller at the same price. The ball is in the seller’s court – they don’t HAVE to sell at any price. But eventually they will be forced to, either because they are moving away, or they can’t meet their mortgage payments, or they can’t refi at an affordable rate. The buyers are not coming back soon so the question is whether the sellers can afford to sit it out.

My opinion is that prices will approximately halve from here. I am in the market to buy but I want to get the nicest house for my money (I make good money and I don’t think it’s unreasonable for me to expect a very nice house for that). There’s no point in me putting in offers now because sellers will just think I am insulting them so I’m renting for now until I can get my price. Other people won’t want to do that – they want to buy now. They are happy to take the 10% off and they are the people that make the transaction marks on the way down.

You have a point chicken, but the what frequently cuts and pastes nonsense. His inability to parse the data coming at him leds me (and perhaps many others) to believe he is a moron whose only field of knowledge is anal sex.

If you want to move the conversation in another direction, please feel free adn the rest will follow.

FYI, what: The UK and the Euro-zone are already in a recession and any investor who tells you to sell has a short position (s)he is hoping to make money from. For someone who thinks everyone is lying to him, you are rather naive to think CS has your best interest at heart.

OOHHHH Assfucks, it’s ya boy! Thanks Dow and the new names is very funny. Now I will take it from here, thanks.

I was thinking you dudes are so far gone! You don’t realize we are in serious trouble but I will not waste any energy explaining it. I will love seeing the Bat smash you in your fucking faces.

U.S. Stocks Tumble as Lehman Brothers Rattles Banking System

http://www.bloomberg.com/apps/news?pid=20601087&sid=a1P7Ag0fTWts&refer=home

“The Standard & Poor’s 500 Index slumped 3.4 percent, its biggest drop since February 2007, a day after the government’s bailout of Fannie Mae and Freddie Mac sparked the biggest rally in a month. Lehman led financial shares to their steepest drop since July after talks to sell a stake to Korea Development Bank broke down. Massey Energy Co., Valero Energy Corp. and Freeport- McMoRan Copper & Gold Inc. fell at least 9 percent.
”

The financial got ASSRAPED today and these are the institutions who lend money to Asshats (like you) to buy overpriced property. They are being taken to the wood shed.

“Investors should sell stocks following the rally as economies in the U.S. and Europe remain weak, Credit Suisse Group said. The rebound is unlikely to last because the U.S. housing decline will continue, while Europe and the U.K. are “close to recession,” Credit Suisse’s London-based analysts including Andrew Garthwaite said in a report dated yesterday.”

Translation: Dump your overpriced shit to the smart investor retards now! Get the fuck out of dodge!

You see Assfucks I think you are going to be crying in your beer come next month. That little Homo Rodeo ya’ll got plan will be a very bad place for ya. Heh heh…

The What (Go fuck yourself)

Someday this war is gonna end…

That’s ok, I strongly suspected it was you and appreciated the gesture. If memory serves, bxgrl almost got in a catfight with you over your praising me!!