What Lies Beneath?
Now that everyone’s had the weekend to digest last week’s insanity, how you feelin’ about ye olde real estate market here in Brooklyn? It’s been clear for a while that the some fringe areas are in for tough times, but how about the most blue chip ones like Brooklyn Heights and the choicest parts of…
Now that everyone’s had the weekend to digest last week’s insanity, how you feelin’ about ye olde real estate market here in Brooklyn? It’s been clear for a while that the some fringe areas are in for tough times, but how about the most blue chip ones like Brooklyn Heights and the choicest parts of Park Slope? How about some of those right in the middle like Clinton Hill? How far do you think they’ll end up falling from their peaks when all’s said and done?
Brooklyn Heights
Clinton Hill
Bed Stuy
Wall Street Reorg: Impact on Real Estate? [Brownstoner]
Photo by Gregory Taylor
Santa You parents live in NC thats fine for them but there is not much to do in NC . Most people that live in NYC would never think of living in the Suburbs. Plus the fact that Crime is Sky high in Charlotte who would really want to move to the South. The prices are so low in places like NC is exactly my point where else will the go? to ZERO
sebb — real estate in the rest of the US has already gone down significantly more than in NYC. And, if you look, you will see that there are already places in the US where real estate has already become nearly worthless.
NYC real estate is hovering over the edge of the pit like Wily Coyote — temporarily defying gravity through force of collective denial. But the 1-2 punch of Wall Street layoffs and tighter lending standards will change that soon enough.
The foreign buyers will not do anything except become a talking point for real estate agents. I really don’t think too many oil barons will be buying up property in the north slope.
Oh, as for homeowners — anyone who is happy where they are living has nothing to worry about. Anyone who really wants to move will get less for their current home but also pay less for their next one. Again, nothing really to worry about.
The only people who have to worry are those who bought something they couldn’t afford or bought as an investment at the top of a housing bubble.
11217 – New York city only has artists and ad agencies and design firms and publishing because it has Wall Street.
Without funding, there isn’t commercial or fine art income for creative folks. In a bad economy, marketing and advertising that utilizes creative content is the first thing eliminated from a companies budget. The fine art world is a total game that that pretty much relies on run-ups from collectors based on a variety of highly subjective factors. With incomes down, there will be less individual purchases and also, if donations are down, less institutional purchases from museums. Forget corporations that are struggling – they will not be dropping big dimes on art work in this environment.
I work directly with artists – and the commercial work is way way down. With a diminished income, buying will become harder, not easier for artists – especially since there are more stringent requirements for them to get a mortgage (state income/no payroll stubs, etc…).
sebb im sorry but NYC is not the center on the universe.
my parents house in Charlotte, NC will most likely go up because of all of this and they have no connection with wall st or banking other than living in Charlotte.
If that 3 mil park slope brownstone goes for 1.5 mil in a year I dont see that causing total destruction of the Idaho and Florida housing markets.
oh and I rent and im under 30.
But where are all of the Homeowners? So if you people (renters) think RE will fall 40% In a Place called NYC. What does that do to the rest of the United States? I guess Real estate Prices in Places like New Jersey , Long Island , Florida, and Idaho become Worthless . Basically you are talking nonsense. People need places to live. I Don’t see anyone panicking in any of the Blue chip nabes in Brooklyn. With 93 Foreclosures in Manhattan compared to 4 million in the rest of The USA you wont catch any Homeowners jumping out the windows. Plus you people keep missing a major point.
Countries like ABU DUBAI and DUBAI will scoop up real estate in NYC . They already bought the Chrysler Building and they were talking today of buying more Real estate in The US They are not talking of buying in the Suburbs.
fsrg…
although I agree with you that everything is connected to the wall st wealth I see the lowering of “wealth” a good thing. I work at an indie record label which is in an already tanking market. I dont see the wall st mess affecting my job any more than the death of cds and online downloading is. But if incomes decrease and people lose their jobs than rental and sale prices will have to come down. If no one rents out an apartment owned by a person who needs the income what will they do?
plenty of cities in the USA survive with studios renting for less than 1500 bucks a month. NYC was one of them until recently.
A hearty “hear, hear!” to fsrq’s comments to dow. No one is going to like what’s about to happen. You laissez faire guys are right that the market corrects itself when there are excesses and corrections keep the system honest. Problem is that there is too much f***ing collateral damage.
There has got to be reasonable oversight of the system. We found that out in 1929 and put safeguards on the commercial banks and trading of equities. We haven’t put in the necessary ones for investment banks, hedge funds, etc. So we pay the piper and hope it doesn’t get as bad as it did back then.
fsrq –
sorry for the slow response… meetings..
Actually I’m not arguing both sides. Federal bailout does create liquidity at the FIs but I don’t think that they’re going to be as willing to lend as before. Risk mgmt is back in vogue so their underwriting will be tighter and also the FIs will be concerned about the economic slowdown both domestically and abroad. Net net, some money is available to lend but they will chase superprime deals. Especially until the securitization market opens up so that they can offload some of these assets.
As for unloading the mortgage backed securities, the FIs don’t like the current prices. There is plenty of money available to buy them but no one wants to sell to the bottom feeders because they have to mark down all their other securities to “market value”. I don’t have a feel for the pricing and the terms that the govt will get on this.
I would love for the govt to do as you suggest. Buy cheap and sell high so us poor slobs don’t get stuck with the bill. Would be nice if they manage to get it done without socializing the entire financial and insurance sectors.
Santa it might be – if you keep your job – do you work for the Government? – b/c tax revenues will be down ALOT and they will have to cutback; or Do you work for a retail store – sales will likely be down with same result;etc, etc, etc, etc
11217 – the 70K a year analyst on Wall Street might have been interested, or the 50K Graphic Artist who did alot of work in marketing (with budgets now down) might have been; or the chef (whose restaurant cant survive) might have been a buyer, or maybe the public defender whose (formerly rich) father might have spotted the downpayment in the past would be interested.
etc, etc, etc, etc
and Dow – economic activity/success is not weight-training – sure creative destruction can be a good thing in the long term – but long-term in this case could be several generations – are you prepared to wait for your Grandchildren to reap the benefits (its a possibility you have to acknowledge)
– renewable energy is all well and good but I doubt too many financiers. lawyers, accountants, (main intellectual capital in NYC right now) etc…. have much to contribute in terms of the engineering.
Those people (should be) good at steering investment into these hopefully lucrative (and beneficial) endeavors, and creating the laws and systems required to manage them. However, if there is no $ to invest, or if our financial infrastructure is so decimated, then this investment either wont happen, or wont happen here.
You want more renewable energy, or less wealth disparity, or less homogenization of neighborhoods – or whatever – policy changes can/could have brought that about but virtually all these goals are infinitly more difficult in periods of economic hardship.
So unless you are just so overjoyed by your schadenfreude, the current situation is bad all around and for virtually everyone in NYC.