Sales Will Come In Again When Sellers Cut Their Prices Enough
A report from the Wall Street Journal on New York. “After slowing for several years, the Manhattan apartment market dropped to a new low in 2018, as co-op and condominium sales fell to the lowest level since the economy last bottomed out in 2009. In an unusual shift for the typically optimistic real-estate industry, some brokers have been urging some buyers to wait if they can because prices may be lower next year.”
“Louise Phillips Forbes, a broker at Halstead Real Estate, said she is telling older retirees who are downsizing their homes to sell now and wait to buy. ‘It will be better to buy after prices go down to maximize retirement funds,’ she said. ‘Patience is your friend.'”
“Brokers say that the Manhattan market was hit by a perfect storm of other problems, after several euphoric years when sales and asking prices rose rapidly.”
“‘It is definitely challenging to be an agent in this market,’ said Shaun Osher, founder of brokerage CORE Real Estate. Mr. Osher said many sellers are reluctant to lower asking prices, while buyers want to have their pick of property at any price. ‘The vultures are swarming,’ he said.”
“Gregory J. Heym, the chief economist for brokerages Brown Harris Stevens and Halstead, said that ‘negotiability is expanding.’ But when brokers want to know when sales will come in again, he tells them: ‘when sellers cut their prices enough.'”
“The Manhattan slowdown began among the most expensive apartments but has more recently spread across the entire market, with sales of apartments for less than $1 million falling by 8.3%.”
From Financial Advisor Magazine. “Ten people (or companies, or people masquerading as companies) spent a combined half-billion dollars on their Manhattan apartments this year. Impressive as it might seem, the numbers are down significantly from the previous three years.”
“Moreover, in the last 12 months, eight out of the top 10 sales were heavily discounted—one apartment at 157 West 57th street took a $17 million price cut before it found a buyer.”
“There’s a chance the top of the market has lower to go. ‘We should think of these prices as an anomaly,’ says Jonathan Miller, chief executive officer of appraiser Miller Samuel Inc. ‘I don’t know if the demand exists for another wave of ultra-luxury units entering onto the market.'”
“The record-breaking sales, he continues, were bound to peter out. ‘I think frankly this was a circus sideshow rather than something integral to the balance of the housing market.'”
“And so discounts abound—for those that can afford them. But before readers rush to lowball apartments everywhere, and developers stop building their super-tall towers, Miller adds a caveat. ‘I can’t imagine the top of the market being any higher, although I thought the same thing in ‘08,’ he says. ‘Now we have stuff that’s twice as high.'”
The Westchester Journal News. “Some expensive property sales in Rockland and Westchester sparked optimism in the luxury housing market in 2018 even though residential sales have been soft at the top in general.”
“Big sales in 2018 appear to have been driven by listing discounts. Sellers who realized their properties were not selling reduced their ‘aspirational’ asking price to meet the market reality, said Jonathan Miller, president of Miller Samuel Real Estate Appraisers & Consultants.”
“‘The only difference between these (sold properties) and the ones that didn’t sell is that the sellers of these properties recognized actual market conditions and net the buyer,’ he said.”
“The $12.75 million sale of a 10,441-square-foot waterfront property in Rye City is an example. The estate — with 1,100 square feet of direct waterfront on Long Island Sound including a private peninsula — was originally listed at $22 million in 2014 and has been relisted several times, with the price reduced by a couple of million dollars a time. The property was sold in July.”
“Stacey Oestreich, real estate agent with Douglas Elliman, who had the listing since 2017 along with her colleague Nancy Strong, said wealthy buyers who are willing to spend north of $10 million for a home sit back and wait, particularly in a buyer’s market, because they have no time or financial constraints.”
“‘They may be tracking properties that they like quite a while. When they are ready to make an offer, they do it,’ she said. ‘The right buyer came at the right price. They paid the fair market value.'”
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Yesterday, the New York Times, today the Wall Street Journal. What’s missing? Actually describing what happened up there as a mania.
‘Brokers say that the Manhattan market was hit by a perfect storm of other problems, after several euphoric years when sales and asking prices rose rapidly’
‘wealthy buyers who are willing to spend north of $10 million for a home sit back and wait, particularly in a buyer’s market, because they have no time or financial constraints…‘They may be tracking properties that they like quite a while. When they are ready to make an offer, they do it,’ she said. ‘The right buyer came at the right price. They paid the fair market value’
Stacey and her UHS friends have changed their tune. Now they scold sellers. Remember how we used to hear how these wealthy people just buy what they want, price is no object! Now they are vultures, VULTURES!
“Stacey and her UHS friends have changed their tune. Now they scold sellers.”
HousingHens are amusing.
‘The record-breaking sales, he continues, were bound to peter out. ‘I think frankly this was a circus sideshow rather than something integral to the balance of the housing market.’
Again, no mention of a bubble, even though the idea of multi-million $ airboxes no one lived in was absolutely nuts! And there’s thousands of them in New York City alone.
‘And so discounts abound—for those that can afford them. But before readers rush to lowball apartments everywhere, and developers stop building their super-tall towers, Miller adds a caveat. ‘I can’t imagine the top of the market being any higher, although I thought the same thing in ‘08,’ he says. ‘Now we have stuff that’s twice as high.’
It was insane in 2008. Now it’s twice as insane. And it’s not just NYC; Miami Beach prices per square foot are similar to the 2008 crash. So when people say, “there’s no bubble, I don’t see a calendar that says 2008”, they just aren’t paying attention. In many ways the bubble is much larger.
“I can’t imagine the top of the market being any higher, although I thought the same thing in ‘08“
And yet your out there spewing your thoughts on the MSM. I wouldn’t take a word of your babble with a grain of salt, I rather sit back and enjoy the show
Mr Miller is one of the most level headed people in the business. He did use the word circus.
I’d like to make a point here. Take any definition you may have for a mania. Ridiculous prices. Over the top “luxury”. Over building. Speculation and financing run amuck. Any definition can be met in Manhattan and could have years ago. And right in the NYT and WSJ’s backyard, they have never described it as a bubble, even two years after it’s popped!
The main stream media will never tell you there’s a bubble. They will never tell you it has popped. To the contrary they will ring up countless industry “experts” telling you not to panic, the sky isn’t falling. It’s just a shift, a blip, wait until the super bowl. Then when it’s too obvious to ignore, out come the vulture quotes.
“So when people say, “there’s no bubble, I don’t see a calendar that says 2008”, they just aren’t paying attention. In many ways the bubble is much larger.”
From everything I’ve seen, this bubble is much worse because not only are prices higher than before, the duration is much longer. More houses have sold at the higher price points than the previous bubble.
The important thing to remember is most of the loans that went bad last time were prime loans, not subprime. This means that it wasn’t so much a situation where people couldn’t afford to pay, it’s that they didn’t want to pay once they were upside down.
When you factor in the aforementioned quantity of houses sold this bubble, then imagine the numbers of underwater borrowers, you’re left with a staggering default rate that could easily eclipse the previous bubble. The market is very sick. The patient is green and about to barf all over the room.
The patient is green and about to barf all over the room.
Perhaps from both ends.
Dont Miami or south Florida has 3 to 4 years of supply of luxury condos
‘when brokers want to know when sales will come in again, he tells them: ‘when sellers cut their prices enough’
It should be noted this is a moving target. Prices have been getting whacked for over two years in NYC. The people who made the sacrifice back then got a lot more than those who held out. Coming to highly desirable cities and towns near you!
‘We should think of these prices as an anomaly,’ says Jonathan Miller, chief executive officer of appraiser Miller Samuel Inc. ‘I don’t know if the demand exists for another wave of ultra-luxury units entering onto the market.’”
The demand was an artificial by-product of the speculative mania unleashed by the orgy of money printing by the central banks. Trillions of Yellen Bux ended up getting parked in Manhattan “ultra-luxury units” since the Fed’s Wall Street grifter accomplices were the primary beneficiaries of the “stimulus” confetti showered on the financial sector by Bernanke & Yellen.
“Louise Phillips Forbes, a broker at Halstead Real Estate, said she is telling older retirees who are downsizing their homes to sell now and wait to buy. ‘It will be better to buy after prices go down to maximize retirement funds,’ she said. ‘Patience is your friend.’”
Sound advise there Louise… so what comes after the sale of there home, get them another overpriced smaller shack they can spend there entire “profit” on after all the closing costs that your paid out on? Works great in your favor especially if you get both sellers and buyers commission checks.
As the Fed’s financial house of cards starts to collapse under the weight of its unsustainable debt and credit pyamid, the usual “gurus” are cooing that all is well to avoid spooking the herd.
https://www.bloomberg.com/news/articles/2018-12-27/as-credit-losses-pile-up-one-bond-guru-dismisses-crisis-talk
OT but too fun not to share (listen to the sounds he makes at 3:06 LOLZ):
https://www.youtube.com/watch?v=PK-mnbH4s74
Triggly Puff’s boyfriend?
Watch “#Trigglypuff!” on YouTube
https://youtu.be/dA3VhoKCIkM
She’s a DebtDonkey in the making.
Thanks I had forgotten about her.
https://www.youtube.com/watch?v=SqqGFoASs9s
“(listen to the sounds he makes at 3:06 LOLZ):”
I think he was transitioning at 3:06
https://en.wikipedia.org/wiki/Transitioning_(transgender)
That is extremely disturbing behavior by a grown man, not to mention an employee on the job. He got fired as well he should have. Loose cannon doesn’t even begin to describe it…
“That is extremely disturbing behavior…”
Try a search for “epic meltdown” on Youtube. Any retail pharmacist will tell you that lots of folks are being medicated to prevent this exact behavior mode.
The saddest thing to me about this video wasn’t the clerk or the guy filming it, but the fact that both are supporting an industry that is financially enslaving millions of young millennials to a new addictive product that is harmful to human health.
Looking at the bright side: It was Other People’s Money …
“Wiped-out hedge fund manager confesses he lost all his clients’ money in emotional video on YouTube”
https://business.financialpost.com/investing/wiped-out-hedge-fund-manager-confessed-his-losses-on-youtube
F-em if they can’t take a joke.
😁
This hedge fund asshat was using naked options shorting – an incredibly risky and dangerous trading strategy should should be illegal, if our policymakers, regulators, and enforcers weren’t so complicit in these rigged, manipulated markets – and his greedy high-net-worth “investors” should’ve known that the high returns this hedge fund dangled in front of them were a huge red flag. Betting against natural gas when temperatures were plummeting – what could possibly go wrong?
You would have to have a heart of stone to see these reckless “investors” not only lose their principle, but also be on the hook for the huge losses on this disastrous naked shorting options strategy that got outfoxed by Da Boyz and their algos, and not laugh.
I expect this to happen more often as various hedge fun asshats, traders, and other self-described “financial wizards” panic as they see everything tanking and try to make the financial market equivalent of a ‘nothing but net’ free-throw from 70 feet away from the basket in order “save themselves and who cares about anyone else”.
It’s going to be very ugly.
This guy stole their money. I guarantee the ending of this story has not been written. This guy will be found sitting on millions upon millions of dollars of ill-gotten gains.
‘I can’t imagine the top of the market being any higher, although I thought the same thing in ‘08,’ he says. ‘Now we have stuff that’s twice as high.’
Suppose the Fed panicked and expanded its balance sheet from $4 trillion to $8 trillion, instead of completing the Quantitative Tightening program underway. Would that do the trick?
I fully expect this to be the path. I don’t think we’ve yet tested the bounds of QE. Why can’t the Fed own everything? I mean, their balance sheet is unlimited, right?
Why can’t the Fed own everything?
Because the Fed cannot create wealth. They can only take from all and give to a few. History teaches that eventually this leads to barbarians at the gate.
“If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks…will deprive the people of all property until their children wake-up homeless on the continent their fathers conquered…. The issuing power should be taken from the banks and restored to the people, to whom it properly belongs.” – Thomas Jefferson in the debate over the Re-charter of the Bank Bill (1809)
That’s you, Zimbabwe Ben & Yellen the Felon. You were what Jefferson warned was going to happen to us.
History teaches that eventually this leads to barbarians at the gate.
And I would say that’s exactly the direction we are headed.
Juno Beach, FL Housing Prices Crater 10% YOY As Double Digit Declines Expand Statewide
https://www.movoto.com/juno-beach-fl/market-trends/
Bear food…yum!
5 Brilliant Moves to Make if the Stock Market Plunges in 2019
Here’s your playbook if the bear market continues in the new year.
Matthew Frankel, CFP
(TMFMathGuy)
Dec 28, 2018 at 6:07AM
The S&P 500 recently dipped into bear market territory. While there’s no way of knowing if the market will drop further, or if the end-of-year rally will hold up, it’s always a smart idea to prepare for the worst.
Bear markets can certainly be scary, and nobody enjoys watching the value of their stock portfolio decline. However, if you take a step back and think strategically, you can make it through the turbulent times unscathed, and can even take advantage of the situation. With that in mind, here are five moves to make if the market continues to decline in 2019.
…
Most of the bear market investment advice I have seen can be summed up in a few words:
1) HODL your stocks.
2) Buy the dip…after the CR8R.
A fifteen-minute video …
Watch “The Insane Battle To Sabotage a New Apartment Building Explains San Francisco’s Housing Crisis” on YouTube
https://youtu.be/ExgxwKnH8y4
City council expects developers to follow “unwritten rules.” WTF?
“unwritten rules.” WTF?
Didn’t make the right “campaign contributions” and choose the correctly anointed sub-contractors…
Redmond WA Housing Prices Crater 20% YOY As Seattle Market Collapses
https://www.movoto.com/redmond-wa/market-trends/
BREAKING NEWS! (not)
‘I see no way out’: Living paycheck to paycheck is disturbingly common
http://www.philly.com/jobs/labor/i-see-no-way-out-living-paycheck-paycheck-is-disturbingly-common-20181228.html
Runaway housing prices and the associated asset bubbles have turned the majority of peoples’ lives into financial pressure cookers.
Ah, yes, the joys of experiencing one’s retirement days …
“I can feel the anxiety in my stomach all the time.”
Mr. Banker says: One should cash out one’s home equity and BUY THE DIP!
😁
U.S. retirees try to keep cool as stocks tumble | Reuters
https://www.reuters.com/article/us-usa-stockmarket-retirees/u-s-retirees-try-to-keep-cool-as-stocks-tumble-idUSKCN1OR1BW
“One should cash out one’s home equity and BUY THE DIP!”
Wouldn’t this amount to using margin loans to buy stock? It seems like such practices created lots of problems back in the 1930s.
Using margin subjects a puke to a possible margin call. Cashing out home equity allow the puke to ride the market all the way down.
PLUS the banker gets to make a few bucks doing the equity cash-out and this money could be channeled by the banker into helping the world’s starving children, something that evil stockbrokers probably would not ever consider doing.
Enjoy the zombie market!
Investing
Up and Down Wall Street
If This Isn’t a Bear Market, Then What Is It?
By Vito J. Racanelli
Dec. 28, 2018 7:15 p.m. ET
The eerie blue light that brightened new York City’s skies on Thursday evening for about 15 minutes was officially attributed to a “sustained electrical arc flash” at a Con Edison plant in Astoria, Queens. My neighbors there thought it might be an alien invasion.
As an eyewitness, I think the likelier explanation is that those brilliant flashes of indigo and purple augured an unusual sentiment change on Wall Street.
Welcome to the zombie market, one that’s neither bull nor bear, neither quick nor cold. Instead, investors stumble around in a stupor—as they have for the past two weeks—arms outstretched, feeding on the latest bit of stray economic nourishment.
Like zombies, they don’t scruple to understand, but instead fasten themselves to whatever information they can get their hands on: news, fake news, or rumors. It matters not whether it’s the latest shoot-from-the-hip tweet from President Donald Trump, a cryptic message from the Federal Reserve, or fresh jobs and inflation numbers.
And they lurch in great leaps, first one way, then another. We’ve seen that in the trading action of the past two weeks, down big one day, up more the next. Since late September, however, it has been mostly down.
Once a zombie investor is off in whatever direction sentiment leads, the rest—as in a Hollywood movie—follow slavishly. This is otherwise known as algo and bot trading. The zombie isn’t a particularly good evaluator of stocks.
…
Portland, OR Housing Prices Crater 20% YOY As Defective Appraisals And Mortgages Emerge
https://www.zillow.com/portland-or-97210/home-values/
*Select price from dropdown menu on first chart
Used house buyer feel underwater? Parliament — Placebo Syndrome:
https://www.youtube.com/watch?v=eMmMuQcRooI
Besides the fact that many of these tiny condos/co-ops go for $500, $600, $700 a sq. foot the other huge obstacle is that many of these
co-op boards decided to enter into land lease agreements that go on for 30-40 years and add $2000-3000 to the already ridiculous monthly HOA payments. Here’s an example and make sure you click on “See more facts and features” so you can see what I’m talking about:
http://bit.do/eEiDM
Hmm… HOA Fee: $3,550/mo? Hoe-Lee-Schitt!
Let’s see – 20% down, Zillow says $6,101 a month total payment, assuming taxes are part of the HOA payment (county website only has tax info the entire building). Over $5 sq/ft a month. oh fun.
Who would buy this with that kind of an HOA?