Real Estate Market Will Be Fine by 2011
That’s what the National Real Estate Investor magazine says, anyway. Well, not fine, exactly, but they predict that another couple of years of “stagnant job creation and tepid economic growth” will yield better results come 2011. Dr. Rajeev Dhawan — one of the economists they consult — “is projecting real gross domestic product growth at…
That’s what the National Real Estate Investor magazine says, anyway. Well, not fine, exactly, but they predict that another couple of years of “stagnant job creation and tepid economic growth” will yield better results come 2011. Dr. Rajeev Dhawan — one of the economists they consult — “is projecting real gross domestic product growth at a rate of 1.4% in 2008, decelerating to 0.5% in 2009 before beginning an anemic recovery to growth of 2.2% by 2010,” they write. Banks will rebound, they say, and oil prices will drop, and maybe inflation will fall, and, after the rough patch, the world of real estate will recover. Even if that scenario plays out, here’s the big question: Since the New York City market took longer to fall, does that mean it’ll also lag on the way back up?
Economists Expect Real Estate Recovery in 2011 [NREI]
Sign of the Times. Photo by respres.
A note to Wasder: I didn’t mean to suggest that you should be judged for buying in the past year. Apologies if my post came off that way. If you are truly in it for the long haul (which is actually quite rare), then you will most likely do just fine. It sounds like you don’t suffer any misconceptions about your prospects for seeing price appreciation anytime soon.
Someone who is a natural 3-5 year buyer and jumped in this year with an expectation to sell at a profit, on the other hand, is an idiot.
“DOW: When you say approaches 0 on a year over year basis; do you mean that the average monthly reading over a 12 month period (which is currently declining) shows no change?”
Exaaaaaactly. YOY = year-over-year = change from last year.
Aussie: Pointing to the impossibility of timing the market as a reason to buy is an old argument, and in my view a terrible one. I can say with great confidence that (1) the market has peaked and (2) it will go down a good ways before hitting the bottom.
It may be impossible to time a bottom, but it is easy to identify a bubble. Why do people buy into bubbles anyways? I don’t know. Ask someone who has bought in Park Slope in the past year. I’m sure they all have some reason for doing so.
Prices are going down and will continue to do so for a while. At some point the direction of prices will become uncertain, and at that point your argument will become a good one. We are not there yet. Not by a long shot.
wasder, here is the deal……
Twhat didn’t buy in clinton hill when they were giving houses away. He thought it was a ghetto. And why would anyone buy in a ghetto?
Then new people came in, made improvements and housing prices rose to a level the twhat could not beleive or afford.
He feels like a fool for not buying when prices were much lower and cashing in on the run-up. Even worse, the socio-economic make up of the new residents made him feel inferior. (That’s his interpretation, not that of the new residents – who really don’t pay much attention to twhat as they have lives to live.)
Instead of accepting that an opportunity has passed and that he has self-worth issues, he comes on this site and tries to talk down the market and blame class/race warfare for all of his troubles.
Interesting approach, but it really doesn’t hold water.
I think you made the right choice Wasder. A person has to live somewhere. So the choice is rent or buy. I like to personalize where I live by doing real improvements so it doesn’t make sense to rent. I bought my first property 20 years ago and I have owned and lived in 4 homes since. If you ultimately intending owning a home it is important to get onto the property ladder. I couldn’t tell you whether I bought in an up or a down market most of the time. All I know is I sold into the same market I bought into.
Housing prices in Clinton Hill will rebound when the twhat fianlly accepts that he has been permanently priced out and his crappy credit will never ever allow him to buy anything. He will then be forced to move. Quality of life will improve dramatically and the rebound will begin.
So, twhat, when are you moving?
wasder – right on!
And for the record you could not buy a brownstone in Asshats Hill for 550 in 2003.
I have already taken the bet. Being a Brooklyn native I have no farm hell hole to return to so I will stick it out thanks. I think you are massively underestimating the determination of people to build neighborhoods and communities. Like so much of your analysis, there is a layer of “truth” (the economy sucks, the housing market sucks) with numerous layers of hyperventilating exaggeration.
What about the Chinese not wanting to dump US debt by the way?