Local Housing Market Headed for the Trash Can?
Real estate experts are convinced that the New York region’s housing market is about to undergo a serious correction, according to an article in yesterday’s Times. Analysts expect the coming bust to be significantly worse than it was in the early ‘90s, particularly in New York’s suburban markets. Nevertheless, Manhattan—and by proxy, pricey Brooklyn—has so…
Real estate experts are convinced that the New York region’s housing market is about to undergo a serious correction, according to an article in yesterday’s Times. Analysts expect the coming bust to be significantly worse than it was in the early ‘90s, particularly in New York’s suburban markets. Nevertheless, Manhattan—and by proxy, pricey Brooklyn—has so far mostly weathered the national housing meltdown, and the decline in values here isn’t expected to be as bad as in our outlying suburbs. During the year that ended in November, prices in the NY metro area fell 4.8 percent, according to Standard & Poor’s/Case-Shiller Home Price Indices—a drop that pales in comparison to Sun Belt cities, many of which saw double-digit declines. Still, economists predict that house prices in the region will drop by at least 15 percent in the current correction. Ouch.
Home Prices Start to Dip, Recalling ’90s Slump [NY Times]
How long are you willing to wait it out? I bought my brownstone in 1995. The previous owner purchased the property in 1986 and sold it to me for the same price 9 years later. They were under water/upside down in their house for 9 years.
Except, and this is pretty important, 10:28, the houses on the market right now suck. So sure, prices are lower but what do you buy?
The inventory is way smaller, way less to choose from. I know so many people who want to buy a house right now and take advantage of the dip in values but they are not finding anything they like well enough.
I’m SO glad we took the leap a year ago and bought our house then. Nothing has been for sale in our price range in the whole year since or listed right now, that’s anywhere close to being as nice. I always look, just out of curiosity.
When I bought my house in 1974 I was very much impressed by one of the advantages of Brownstone living that was pointed out by the Brownstone Revival Committee–since neighborhoods were certain to improve, there would be no need to folloe the suburban model of “upgrading” to “better” houses.
Believing that might have required a leap of faith [or suspension of disbelief] 33 years ago, but it proved to be correct. MOST of us brownstoners are in it for the long haul and will not be harmed–even those of us who bought at the top of the market.
New construction condos might be another matter, but this site IS intended for those of us who share an”unhealthy obsession” with historic houses.
For the person who bought recently (late 2006 to no) with lets say 10% to 15% down a 20% drop could be a disaster.
The 3Ds don’t discriminate – death, divorce, disability.
Let’s not talk about unemployment…
“No big deal”:
If you buy a two million dollar house today expecting a 10% price correction in the next year, that means you are willing to pay an extra $200,000 to own this year instead of next year.
If you have $200,000 that you are happy to throw away like that, why not do something useful with it? Or take a year off from work and travel around the world?
It’s nice to hear people being level-headed about this. We happened to buy in late 2006 and honestly, we’re not panicking either because a) we intend to stay for a while and b) we just refinanced our mortgage and have lowered our monthly payments significantly. Also, even if you do want/need/have to sell, what you’ll be buying will have declined in value as well, so you’ll be paying less for an upgrade than you would have a few years ago. I don’t think it’s that bad.
I’m renovating my kitchen this year, landscaping in front and back, and re-brownstoning my facade. And taking a week in the Carribbean. In it for the long haul. Ten years from now, probably less, we’ll look back at this dip and shrug.
A 20% decline today is greater (in dollar terms) then last years 20% increase
I don’t think anyone bought in 2006 hoping to flip. If they did they had their head in the sand. People buying in 2006 probably intended to stay there 5-10yrs, in which case this isn’t a problem.