Tales from Florida
Lehigh Acres, Florida is a far cry from New York City but the apocalyptic scenerio described in The Times this weekend was enough to send shivers down the spine of even the most optimistic gotham dweller: Trinkets for $1 were an early sign of trouble. Early last year, garage sales and estate auctions became more…
Lehigh Acres, Florida is a far cry from New York City but the apocalyptic scenerio described in The Times this weekend was enough to send shivers down the spine of even the most optimistic gotham dweller:
Trinkets for $1 were an early sign of trouble. Early last year, garage sales and estate auctions became more common in Lehigh Acres as families sold what they could to survive. No one seemed interested in buying whole houses, and foreclosures soon gave way to empty homes that became magnets for crime. Thieves stole air conditioner parts for scrap. And on distant roads with only a few new homes and faded blue street signs from the ’50s — on Narcissus Boulevard, on Prospect Avenue — drug dealers moved in. In 2007 and 2008, the Lee County Sheriff’s Department shut down more than 100 houses in Lehigh Acres where marijuana was being grown. In 2008, the police confiscated nearly 3,000 plants valued at nearly $7 million.
Gulp.
“Don’t count ’em ’til they hatch.”
***Bid half off peak comps***”
Again, the dense short-term thinking.
BHO…you think that during a period of rising inflation and risinfginterest rates that real estate prices aren’t going to rise as well???
Econ 101, my friend.
If you’re keeping your downpayment in a savings account you aren’t earning anything on it right now.
I think it is fair to say that we will see significant declines from here in the NYC area. How much of a decline is up to debate. However, an important point that the articles mentions that folks seem to be overlooking is that the runup in supply in Lehigh Acres has greatly exacerbated the problem. While there have certainly been a number of developments that have come on line in Brooklyn, the net effect on housing stock is nothing close to the runup in Lehigh. In addition, there is no “coop cushion” in Lehigh Acres to mitigate the rush of foreclosures, etc.
Bottom line, while things are grim here and will get signficantly worse, I believe that NYC (and even the close-in burbs) have some structural advantages that should prevent the kind of complete meltdown we are witnessing down south and in other far-flung exurbs where BOTH land and money were in abundant supply.
“All of them with substantial gains over the past 7-11 years.”
Don’t count ’em ’til they hatch.
***Bid half off peak comps***
Dave,
I can’t wait until 2 years from now when all these people look like a deer caught in the headlights when interest rates are 8-9%. Housing might cost 25% less, but you’ll be making up for it (and then some) on the interest alone.
“If rates go up on Miss Muffett (likely) she will have made a terrible mistake.”
There would then be a proportional “affordability” drop in prices added to the already downward spiral. Mistake doubtful. And even then, a rising personal savings account can offset interest rate increases. More money down on a cheaper house. Same mortgage payment or less.
***Bid half off peak comps***
Didn’t want to pony up the $2-3MM for elsewhere in Brooklyn because I’ve got 3 other residences, that’s why. All of them with substantial gains over the past 7-11 years. No other mortgages either.
I think I know a thing or two about the real estate market.
You don’t really “have my attention,” and I’m certainly not “worried.”
“Overpaying has no effect if you’re looking for a long-term residence, all other things being equal.”
But all things are not equal. You are VERY unlikely to see a boom/bust like this again in your lifetime (or before your health deteriorates). After inflation, the long haul argument breaks down mathematically. Fortunately, for those of you who wish to, and can, “hold on”, you probably won’t feel the REAL effects on your home value. But overpaying IS overpaying.
***Bid half off peak comps***
“I just love the fact that all these team Bear people know what the downturn is going to look like, how long it will last and how long it will take to reach a bottom.”
Wait a minute! I’m not putting a deadline on nuthin’! It’s process, not an event. I measure the process along the way, that’s it.
“Bottom line is that few peole who have bought a brownstone, even at the top, could rent SIMILAR SPACE and have a similar lifestyle for what they are paying on their mortgages and real estate taxes.”
Get the hell out of Brownstone Brooklyn until things cool off. If I needed to, I would. Sacrifice lifestyle. Delay your gratification. The options are endless if you’re creative.
“Christ, how dense are you?”
Pretty dense. I see beyond an individual sale price here and there. I zoom out and see number of sales plummeting like 30-40%. I see history telling me that before plummeting prices, you will have plummeting volume. But I guess that makes me dense. But I have your attention so you must be worried. Just sell. What’s a hot shot “Hedge” Fund manager doing in Bed Stuy, anyway? Bread Stuy? Utica A Express stop?
***Bid half off peak comps***