Saturday, July 08, 2006

Weekend Open Discussion

Observations about your local areas, comments on news stories or the New Jersey housing bubble, Open House reports, etc. If you have any questions you wanted to ask earlier in the week but never posted them up, let's have them.

For readers that have never commented, there is a small link on the bottom of each new message that reads "# Comments". Go ahead and give that a click, you might be missing out on a world of information you didn't know about. While you are there, introduce yourselves to everyone. For new readers that have only read the messages displayed on the main page, take a look through the archives, a substantial amount of information has been put online in the past 6 months. The archives can be found at the bottom of the right hand menu and are categorized by month.

As always, anything goes!

73 Comments:

Anonymous Anonymous said...

Does anyone have or know where to find changes in rent in Northern New Jersey over the past few years. Just wonder whether there might be a close relationship between the rent and the price of houses.

7/07/2006 04:55:00 PM  
Anonymous Pat said...

http://www.huduser.org/datasets/fmr.html

hud

7/07/2006 05:24:00 PM  
Blogger grim said...

From, well, this blog..

Arbitrageur, not renter.

7/07/2006 05:24:00 PM  
Anonymous Anonymous said...

Oh, yeah..there too ;)
Pat

7/07/2006 05:28:00 PM  
Anonymous Anonymous said...

Harrah's is giving away free rooms every night in August (except Sat)!

Gotta make up some bucks.

Pat

7/07/2006 05:43:00 PM  
Blogger Richard said...

the top towns have barely been affecting by this slowdown, at least in terms of selling price. while listings are up, the selling prices are still near peak. the real decline hasn't taken hold yet. have to wait for higher rates and some ARM resets.

7/07/2006 06:56:00 PM  
Anonymous Anonymous said...

http://www.cnn.com/2006/TECH/internet/07/07/hawking.question.ap/index.html

http://tinyurl.com/o8xfa

Maybe as the bubble questions there?

7/07/2006 07:02:00 PM  
Anonymous UnRealtor said...

Another update on my favorite flipper:

17 Mount Ararat, Short Hills

http://www.realtor.com/Prop/1060522933

1) Jan 21, 2006 - $759,000 (MLS 2237332)

2) Mar 24, 2006 - $698,999

3) May 10, 2006 - $698,998 (dropped price $1)

4) May 23, 2006 - $639,000 (Re-listed as MLS 2281275)

5) Jun 13, 2006 - $625,000

6) Jul 07, 2006 - $595,000

7/07/2006 07:04:00 PM  
Blogger chicagofinance said...

grim:
should I pull out the bubble sitter crap?

7/07/2006 07:08:00 PM  
Anonymous Anonymous said...

CF
you don't believe in the bubble anymore?

7/07/2006 07:57:00 PM  
Anonymous Anonymous said...

This has to be bad news.


Home equity lines of credit rates highest in 5 years
Updated 7/7/2006 3:33 PM
NEW YORK (AP) — The Federal Reserve's string of interest rate hikes is making it much more expensive for consumers to borrow against their homes.
The interest rate banks and other financial institutions charge on home equity lines of credit jumped to an average of 8.2% after the Fed voted to raise short-term interest rates last week for the 17th consecutive time, according to Bankrate.com. Up from 8.01% a week earlier, it is the highest rate since 8.25% in March 2001.

Greg McBride, a senior financial analyst with Bankrate.com said that "what you're seeing is the rates on lines of credit paralleling the moves by the Fed."

A year ago, home equity lines of credit carried an average rate of 6.38%, while two years ago they were priced at 4.83%, he said.

McBride said consumers faced with the higher rates have several alternatives: They can pay down the lines of credit or shift to fixed-rate home equity loans, which now are carrying an average rate of 7.8%.

7/07/2006 08:51:00 PM  
Anonymous Anonymous said...

lots of houses I'm interested in have a 'septic' sewer and 'well' water. Can anyone shed some light if it's good idea or not buy a house with this vs. or public septic and water? Thanks.

-poignant

7/07/2006 09:20:00 PM  
Anonymous Anonymous said...

Grim,

you ever figure out your excel model? The rent vs. buying model.

SAS

7/07/2006 09:31:00 PM  
Blogger Grim Ghost said...


ots of houses I'm interested in have a 'septic' sewer and 'well' water. Can anyone shed some light if it's good idea or not buy a house with this vs. or public septic and water? Thanks.


In general, it is vastly preferrable to have city sewer and preferrable to have public water.

You have the cost of inspecting the sewer, inspecting when purchasing and occasionally after that. You have the cost of pumping out the septic tank every 2 years or so, and getting it replaced after a while. And then you need to have a leach field. Some towns will charge for sewer services, but the cost is minimal compared to the cost of septic maintenance.

Well water also needs to be inspected when you buy and from time to time, and you need to replace filters, you need a holding tank etc. There is an advantage in that you don't have to pay for water. Ideally, you would get drinking water from the city, and all other water from the well, but that is not allowed by most water companies, that require you to cap the well. I also don't know what might happen if you run out of water in a particularly dry summer (holding tank or no).

But in some towns and houses, you may not have an alternative. Towns may not allow new connections to the sewer system, there might not be a sewer or water line in the street where the house you're looking at is located.

Discount for the absence of sewer connection and water connection. I would discount around 20K for absence of sewer, and maybe 10 K for absence of water (or whatever the cost of connecting to the public water or sewer would be).

7/07/2006 09:32:00 PM  
Blogger Grim Ghost said...


You have the cost of inspecting the sewer, inspecting when purchasing and occasionally after that.


I meant you have the cost of inspecting the SEPTIC tank.

A septic tank and/or well water is not a deal killer, and in some areas there is no alternative, but you should consider it a negative for the house.

7/07/2006 09:34:00 PM  
Anonymous Anonymous said...

Thanks grim ghost. The town I'm looking in does have public water and septic for most part but this particular community is about 7-9 yrs. old and almost all of the homes have septic and well.

-Poignant

7/07/2006 09:44:00 PM  
Anonymous Anonymous said...

Everything GG says, plus my brother has well/septic since 1975 and has had to drill. Nasty iron taste, but it tests fine. Stains in all fixtures were terrible, but I guess it depends on the location and how much you spend on your add-on systems. Just a royal pain in the butt, going out to the pump house in the winter.

Some communities require hook-up at property transfer, where the property has not been transferred since local law change. There are also HUD requirements for FHA situations at hud.gov.

Can run $10-15k (per my real estate agent).

Pat

7/07/2006 09:51:00 PM  
Blogger RichInNorthNJ said...

From, well, this blog..

Yea, but isn't THAT blog very bias?

Have a great weekend Grim.. you too {{ ? }} and $300 jeans.

Rich

7/07/2006 10:19:00 PM  
Blogger Mr. Oliver said...

Grim,

That was a great link you posted above, re renter/arbitrageur. Buried in that article was a link to a create calculator of the costs of owning v. renting.

You've put together a fantastic blog here. It is a wealth of information.

Thanks.

7/07/2006 11:10:00 PM  
Blogger Mr. Oliver said...

Pat, do you have a link to that deal at Harrah's?

7/07/2006 11:15:00 PM  
Blogger Richard said...

unrealtor, the magic # is $600k. once you get below that you open up the market to a much larger buying pool believe it or not. the flipper property is approaching a price that isn't so laughable. what i want to do know is, who deciding on building that pizza counter in the kitche? LOL!

7/08/2006 03:05:00 AM  
Blogger grim said...

Dutchess County sees average and median price declines..

Dutchess home prices level off

The plateau of home prices in Dutchess County has now stretched more than a year, a report indicates. And, for the first time in what has been a long streak of year-over-year gains, average and median prices failed to exceed those posted a year earlier.

The average price of a single-family, free-standing home in Dutchess County in June came in at $407,664. That was down less than a percent from the $408,826 of June 2005, though it was up from May's $400,736.

The median price, $349,500, was down 2.2 percent from a year ago, and down $500 from May.
...
The average price was lower than six of the last 12 months and higher than six. The median price was higher than seven of the last 12 Homes available for sale rose to 2,085 at June 1, a gain of 44.9 percent over June 1, 2005, and average days on the market before sale rose to 111, up 16.8 percent.

Volume of closed sales was 944, off by 2 percent.
...
Attached homes, including townhouses, condos and co-ops, averaged $220,975, or 5.2 percent higher than June 2005. The median of $189,000 was 2.6 percent lower. Tambone noted a 21 percent decrease in the number of sales, to 45, and available listings rising to 298, nearly 95 percent more than they were a year ago.

7/08/2006 05:19:00 AM  
Anonymous Anonymous said...

Mr. Oliver..the card came Friday. Four neighbors got same card. Do you have a Harrah's card?

Call 800-242-7724 press 7 or ask to speak with a host for a room.

7/08/2006 05:49:00 AM  
Blogger grim said...

For those interested, I've included the sales data from 2002 into the graphs I posted yesterday.

North Jersey Residential Sales

If you follow the 2005 sales (yellow line) through the year, you'll see we dropped under 2002 volume in September. At this point we've now spent 9 months below even the 2002 sales pace (March being somewhat of an exception).

jb

7/08/2006 05:55:00 AM  
Blogger Shailesh Gala said...

From NYT:

Drastic Action, Modest Result in New Jersey

7/08/2006 06:47:00 AM  
Blogger Shailesh Gala said...

Article on Manhattan Condos on NYT:

Are There Enough Buyers to Go Around?

7/08/2006 06:49:00 AM  
Blogger chicagofinance said...

Shail:
RE NYT Article on condo buyers

when the market turns down - they won't know what hit them

7/08/2006 07:31:00 AM  
Blogger chicagofinance said...

I will also have no sympathy or patience for inevitable din of frustration and wallowing.

This IS NYC. Well, the WILL be lawsuits.

Oy!

7/08/2006 07:32:00 AM  
Blogger X-Underwriter said...

Anonymous said...
lots of houses I'm interested in have a 'septic' sewer and 'well' water. Can anyone shed some light if it's good idea or not buy a house with this vs. or public septic and water? Thanks.

If at all possible, get a house with public sewer and water. With a septic, you'll eventually have to dig up and replace it which usually costs $20,000 or more. Public sewer is always better because you can just flush and forget it. With septic, you always have to monitor how much paper you're flushing down and how many times you flush. The system has limits to how much it can handle. If you're looking to buy in a less suburban neighborhood, this might be your only option however. Public utilities are always just less hassle

7/08/2006 07:54:00 AM  
Anonymous Anonymous said...

Shailesh - ooh the times RE section dips a trembling little toe into RE reality!

Of course the ad-yoked paper isn't bold enough to actually answer its own question about condo buyers. They have to look like they kind of know what's going on without pissing off their benefactors. What's interesting is that this usually shill-y section feels like it has to say something (however mealy mouthed) - so you know it must be bad.

And we all know the answer is NO, there are not enough buyers, inventory is spiking and the insanely run-up market is overdue for correction.

7/08/2006 07:54:00 AM  
Anonymous Anonymous said...

With septic, you always have to monitor how much paper you're flushing down and how many times you flush

As the saying goes ( with septic owners anyway)

If it's yellow - let it mellow
If its's brown - flush it down.

Whoooo hoooo the joys of septic.
Not for me !

KL

7/08/2006 08:17:00 AM  
Blogger Richard said...

the key fundamental driver of RE values is job quality/growth. yesterday's weak rise of 121k consisted of government, health care and restaurant service jobs. not the kind of wages that's going to sustain housing values multiple deviations above income levels.

sit back folks. with continued weakness in job growth, inflation creeping up and rising interest rates this housing bubble is going die a slow death. patience daniel son.

7/08/2006 09:10:00 AM  
Blogger grim said...

Nice day to go for a drive. I'm going to pack the dog and GPS in the car and go for a trek through the Plainfields and surrounding area.

And before you even ask (you know who you are), I won't be dropping off a housewarming gift for 'Jimmy'.

7/08/2006 09:46:00 AM  
Anonymous Anonymous said...

i drove by those homes on
Valley rd. in Clifton this
morning to take a look.

What a disgrace., These homes have
been reduced to 650k range.

Is this builder crazy, even the
landscaping is dying already.

And to live accross the street from
a Quick Check.

This is actually stunning.

Thes joints should sell in the 400k
range. Maybe.

Plus he's got the nerve to call
them Estates.

But if your coming from the Bronx
or Queens, I guess they are "Estates"

Stunning

7/08/2006 09:47:00 AM  
Anonymous Anonymous said...

Registered for the RE Forum but have not yet rec'd validation email....so....I'll post my ? here.

can anyone tell me how to go about checking the amount of condos in Myrtle Beach? There vacancy rate..etc etc etc. Thinking of buying one but only holding on to it for 5-6 years...

Thanks

7/08/2006 10:00:00 AM  
Anonymous Anonymous said...

I am starting to believe we are going to be waiting quite awhile to be able to buy a home. Even though the inventory is building, I do not see major price declines. Everytime I see a new listing, it is still priced $100k more than it should be.

7/08/2006 11:00:00 AM  
Anonymous UnRealtor said...

More on the islamic terrorist plot to attack NJ/NY commuter trains:


Plotters Plan Mass Suicide on Train on 9/11/06

July 07, 2006 6:00 PM

Brian Ross Reports:

Federal law enforcement officials tell ABC News a plot designed to use 15 to 20 suicide bombers on one commuter train as close to Sept. 11 as possible was well underway.

The specific target was the PATH commuter trains that run in a tunnel under the Hudson River into New York City.

"This is a plot that would have involved 'martyrdom,' explosives and certain of the tubes that connect New Jersey with lower Manhattan," said Mark Mershon, Assistant Director-in-Charge of the FBI New York Field Office. "We're not discussing the modality behind, beyond that."

But law enforcement officials say the plotters had already accessed detailed blueprints and drawings of the PATH tunnels, available on the internet.

And like the London bombers, the plan was to load backpacks with explosives.

All 15 to 20 bombers were to board one car and detonate when the train was under the river, according to officials.

http://blogs.abcnews.com/theblotter/2006/07/plotters_plan_m.html

http://tinyurl.com/z5a8g

7/08/2006 11:34:00 AM  
Anonymous UnRealtor said...

"the flipper property is approaching a price that isn't so laughable."


Except the comps on that street are all in the $300K range for the last few years. I wouldn't be interestid in that house if it was $400K, or even $300K, but I suppose some buyers might.

7/08/2006 11:38:00 AM  
Anonymous Anonymous said...

i drove by those homes on
Valley rd. in Clifton this
morning to take a look.

What a disgrace., These homes have
been reduced to 650k range.


I live in the area and have heard through the grapevine that the builder may be forced to take the rooves off because they're too high for city code. Yikes!

The same builder has also reduced his pre-construction prices for two lots on Stuyvesant Court nearby from $679K to $649K.

7/08/2006 12:13:00 PM  
Anonymous UnRealtor said...

The flipper's neighbor, who's now priced over the flipper, and the house isn't even remodeled:


16 Mount Ararat, Short Hills

Jan 25, 2006 - $699,000 (MLS 2239439)

Apr ??, 2006 - $659,000

Jun 23, 2006 - WITHDRAWN

Jul 08, 2006 - $609,000 (MLS 2296927)



The nightmare of both these sellers: MLS 2203960. A brand new (built 2005) 4BR house, with top-notch everything (granite, nice cabinets, etc). Sold for $680K in Feb (was listed initially at $850K for about 6 months, and dropped like a rock every few weeks). Still sold for $20K under final asking ($699K).

7/08/2006 12:16:00 PM  
Anonymous Anonymous said...

2203960's tax is much higher than the other two. Is it because it is new construction?

7/08/2006 03:16:00 PM  
Blogger Richie said...

i drove by those homes on
Valley rd. in Clifton this
morning to take a look.

What a disgrace., These homes have
been reduced to 650k range.

I live in the area and have heard through the grapevine that the builder may be forced to take the rooves off because they're too high for city code. Yikes!

The same builder has also reduced his pre-construction prices for two lots on Stuyvesant Court nearby from $679K to $649K.


Yes.. the buildings are too high.. My dad does a lot of building in Clifton and he heard this as well.

Funny thing is, in regards to the landscaping comment above, the owner of those homes is a landscaper.

-Richie

7/08/2006 03:29:00 PM  
Anonymous Anonymous said...

Did the market collapse yet?

7/08/2006 04:26:00 PM  
Anonymous Anonymous said...

Had a septic/well for 18 tears before I recently sold.
Had it pumped every 2 0r 3 years.
Never had a problem with it, or the well, and the buyer's inspector claimed the system looked brand new to him.

7/08/2006 04:32:00 PM  
Anonymous Anonymous said...

Could the builder have been that
stupid that for over 600k,no
sprinkler system??

7/08/2006 05:10:00 PM  
Anonymous Anonymous said...

Can anyone provide some information about the town and schools system for south brunswick and hackettstown? how is there schools system? I work in Morris county and considering these two towns. They are in different directions. Hackettstown is little closer to work (further west) but no bus service to city for wife.( train is slow). South brunswick is far for me but there is faster bus and train to nyc. any thoghts would be appreciated. Thanks.

-poignant

7/08/2006 09:14:00 PM  
Anonymous Anonymous said...

poignant,

I live in Morris county. I don't reccomend Hacketstown if there is no bus service to NYC. The bus is far superior to the train. Even driving from Hackketstown to Denville Nj Hospital job was a headache for some of my coworkers. My former spouse lives in the poconoes and takes a bus to NYC. He couldn't stand the train. Most bus lines seats are alot more comfortable and you leave the driving to someone else. What part of nyc does your wife work? Does she have to put in long work hours? The Midtown Direct train is real slow. My brother in law lives in South Orange,NJ and he takes a train to NYC. The train is a major pain in the ass. My brother in law even wants to move into NYC to avoid the train and he currantly live just 15 miles outside of NYC. These train lines are all old and njtransit does not care if you get to work on time. I have lived in Morris county for over 13 years and before that in NYC for 10 years...the one thing that hasn't improved is nj transit trains. So I guess check out south B. I would even go so far as trying and timing the commute and then compare notes. I also feel Hacketstown is not as developed transportation wise and you might really feel the pain on a daily basis.

Chow Dog Owner

7/08/2006 10:04:00 PM  
Anonymous Anonymous said...

Unrealtor,

i've seen both houses on Mt. Ararat in Feb. The major reason whey they are not selling is because of their common location - it's on an odd, isolated street in the midst of the commercial distict and Wendy's right next to it.

Yes Short Hills is very desirable, but not on this street.

7/08/2006 11:08:00 PM  
Anonymous UnRealtor said...

"2203960's tax is much higher than the other two. Is it because it is new construction?"


It's a much bigger, nicer house.

7/09/2006 10:19:00 AM  
Anonymous UnRealtor said...

"The major reason whey they are not selling is because of their common location..."


Check the comps on that street 3-4 years ago, most are in the $300K range.

I agree the street is awful, but for the right price, anything will sell.

These sellers think their awful street translates into only a $150K 'location discount' and potential buyers obviously disagree.

7/09/2006 10:47:00 AM  
Anonymous Anonymous said...

Hey Everybody,

I just thought I would give you all a little feedback from a sellers perspective. I live in Morris county. I don't want to push my listing. I just want to give you my point of view. All around me homes are being built at the 800K range and up. Currently my local bubbleheaded developer is midway through putting in city sewers on the next steet over. When his latest project is done these new homes will be priced at 1.1 million and up. My home is a basic ranch which I have updated over the last three years. I even put in new copper plumbing. My driveway is about 100 ft long (rebuilt/paved 2005). I updated the home not (renovated). I have a lovely 1.46 acre lot (fenced), greenhouse (has electricity), root celler(wine celler). Last Summer I hooked up to city water and got rid of my well (due to all the building. My home is newly on the market. My reasons for selling are family related (Elderly parents who live far away). I expect now not to sell because all the people that look at this home don't like it. Why ????? The buyers don't want to pay 475 and then have to renovate (expand home). They can't wait to buy new construction at (850K). I kid you not. I have a fantastic little home and its even cheaper than most townhomes. It could use a creative type to add and expand the way they want it done. I live three miles from a Mid-town direct train. My backyard used to be an apple orchard. The schools here are top level. I live within 5 miles of elite private schools. My taxes are damn low for the area (under 6k). Every new house here is paying 13k and up. My yard is very easy to care for because half of it is wooded. People today just seem to hate an unplugged lifestyle. Last weekend someone showed up to look at my house in a new top of the line white jaguer. I just had to laugh...no way are they going to spend money on my house in this luxury neighborhood. Because their damn car is costing them 900.oo a month. I think the world has gone crazy around here. I really can't say I am surprised. But no way am I selling a house on this location (1.46 acres) with three beds and two baths for 475k this year people want it for nothing. All I wanted to do is relocate and get a little closer to my parents. Thats another can of worms. I feel sorry for some people who need to buy a home...but I say start small and remodel don't get into 750k and up especially if you are under 35 yrs. of age. I wish everyone all the best. But I have to be honest when I bought My first house it was a work in progress. This same home I am now selling and I put alot of time and money into it. Whats getting me is how angry people are regarding real estate. If and when I sell I can assure you I will not be making a financial killing. Have a good day guys!!!

P.S. Good Health is priceless


Chow dog owner

7/09/2006 12:02:00 PM  
Anonymous Anonymous said...

Poignant -
South Brunswick is overpriced for what it is although it is a decent enough neighbourhood. The taxes are currently low due to low evaluations but that is soon to be revised. Commute to Manhattan is realistically 1 hour 15 minutes at least by train and there is a long waiting list for parking. There is a direct bus which takes about and hour or so but if you miss the fast one the slow one goes through New Brunswick which adds another half hour.
Crime is also up - we had a helicopter hovering over hour house for 2 hours last night looking for some criminal on the loose - lovely, my husband wants to move.

7/09/2006 06:56:00 PM  
Blogger Richard said...

"South Brunswick is overpriced for what it is although it is a decent enough neighbourhood

EVERYTHING is overpriced though prices are starting to drift down even in the top tier neighborhoods. for example in westfield houses in feb/mar that were fetching $620-$640k are now sitting on the market at $600k or selling at $590k or so. my opinion is it'll continue to drift down as rates go up further squeezing the buying pool. everyone needs to take themselves out of this market until next year.

7/09/2006 07:52:00 PM  
Anonymous dreamtheaterr said...

Anonymous said...
Poignant -
South Brunswick is overpriced for what it is although it is a decent enough neighbourhood. The taxes are currently low due to low evaluations but that is soon to be revised. Commute to Manhattan is realistically 1 hour 15 minutes at least by train and there is a long waiting list for parking. There is a direct bus which takes about and hour or so but if you miss the fast one the slow one goes through New Brunswick which adds another half hour.
Crime is also up - we had a helicopter hovering over hour house for 2 hours last night looking for some criminal on the loose - lovely, my husband wants to move.

7/09/2006 07:56:27 PM

I rent in North Brunswick (South Brunswick for practical purposes) since I am on Finnegans Lane, and I heard the helicopter too...it frightened the living daylights out of my wife.

I take the Coach USA bus into NYC everyday. It's 1 hr on a good day, and can be 2 hrs 30 mins on days of heavy snow.

7/09/2006 08:33:00 PM  
Anonymous Anonymous said...

Chow dog owner,

Man, I feel your pain. Sounds like you are a victim of the times. Your story reminded me of some of the downtowns that were shutdown because of the WalMarts.

These are stange times indeed. People have gotten so irrational its unbelievable. But I say chin up. It might take awhile, but there are smart people out there who know a value when they see it. It will just take some time. Pop open some of that wine from the wine cellar.....he...he....

Your house sounds really nice, mind throwing up the MLS so we can have a view? If not, I respect that too.

SAS

7/09/2006 10:30:00 PM  
Anonymous Anonymous said...

This off the wire:
http://www.thestreet.com/markets/realestate/10295183.html

New York City real estate hasn't hit as many bumps as the broader national housing market, with prices in the city continuing to soar despite increasing supply.
In the second quarter, the median sales price of co-ops and condos in Manhattan rose 13.5% from a year ago to $880,000, despite overall sales falling 14.8%, according to the Prudential Douglas Elliman Manhattan market overview released Thursday. During the same time frame, listing inventories rose 54% to 7,640 homes.
"It's not a buyers market, not a sellers market, it's very evenly balanced," says Prudential Douglas Elliman CEO Dottie Herman. "So, I'm looking to see by the end of the year whether it tilts at all."
The price gains were helped by another year of record Wall Street bonus money, says Jonathan Miller of Miller Samuel, the appraisal firm that tracks the data used in the Elliman report. Firms like Goldman Sachs (GS) , Morgan Stanley (MS) , and Merrill Lynch (MER) all reaped in hefty profits last year.
"The Wall Street bonus money exaggerated price growth, because at the same time you had rising inventory," Miller says. The second quarter had the highest inventory level since 1999, when Miller began tracking sales. The decline in sales activity was the worst in three years, he says.
The growing inventory is due to a tug-of-war between many sellers and buyers who are having trouble converging on prices. "I'm struck by how many buyers are waiting on the sideline," Miller says. "There are buyers, they're just not pulling the trigger."
But if apartments are priced right, they're moving, he notes.
"People were worried once supply crept up that prices would have to come down. But it just shows that demand is very strong," says Greg Heym, chief economist with Brown Harris Stevens, which released its own report on New York City sales showing that the average price per square foot of a New York City apartment rose to $999 in the quarter from $962 a year earlier.
The strong demand is helped by a booming city economy. As evidence of this strength, Heym points to the recent New York City Comptroller report that showed that the number of employed city residents reached a record level in the first quarter.
Brokers and economists also note that New York's real estate market doesn't suffer as much from investors and speculators who bid up prices to unhealthy levels in markets like Florida and California, where sales are slowing significantly for homebuilders like Toll Brothers (TOL) .
" [New York] is not going to grow rapidly like we did the past few years," Heym says. "But we're not going to drop rapidly either."
A separate report from the Corcoran Group said the median sales price for co-ops and condos in the borough of Brooklyn rose 6% to $510,000 in the first half of this year from the same period in 2005.


ok, this is SAS here. I hear this line of crap all the time....that "ohh the firms like Goldman Sachs (GS) , Morgan Stanley (MS) , and Merrill Lynch (MER) all reaped in hefty profits last year. Therefore they are going to put pressure on the housing market.."

Let me tell you, that is just BS. I have worked with all these boys. Only very few people see that money, and its the big wigs. You think Ray Ray in the mail rooms get a fat bonus? Let me tell ya, alot of those big wigs money goes to private jets, call girls, and up their noses. Yes, they have multipe propertys, but most are out of nyc.

7/09/2006 10:41:00 PM  
Anonymous Anonymous said...

have worked with all these boys. Only very few people see that money, and its the big wigs. You think Ray Ray in the mail rooms get a fat bonus?

Wishful thinking. You would be amazed by the number of 34 year olds with top analytical skills (math whizzes) who earn $350K+ per year working for i-banks.

No, they're not Ray Ray in the mailroom, but they're far from top management. Just smart kids, working in the right place at the right time.

7/10/2006 05:08:00 AM  
Anonymous Anonymous said...

It was DEAd this weekend.

Greedy money grubbing sellers sit and sit and sit.

Lower the prices Grubbers!

You want someone to bail you out for retirement. NO MAAS!

Babababababa

Bob

7/10/2006 06:32:00 AM  
Anonymous Anonymous said...

Doggy Chow

Thanks for the honest post.
Society has run wild the last several years.

Now it's time for rationality to resurface.

Babababababa

Bob

7/10/2006 06:37:00 AM  
Blogger BergenBuyer said...

Folks,

I put together a survey so that we could get a concise report of what everyone feels will happen in this market. It's a 10 question survey that should take no more than 30 seconds to complete. Here's the link:


http://www.zoomerang.com/survey.zgi?p=WEB225G72ZZ53H

Regards,

KJ

7/10/2006 07:48:00 AM  
Anonymous Anonymous said...

anon 06:08:20,

Yes, you are correct about the ounger guys making around that much. These guys get the call girls that cost about 500-1,000/hr.

I know this crowd. There are some good whips in that crowd. In my opinion, these guys don't really move the RE market. Maybe the call girl market....

I think these guys are not the big influence that everone thinks. Is there trickle down econmoics here, yes...for sure, but I just don't think its the degree that everyine thinks. I have been here too long and worked with them all through all sorts of ups and downs too see that they just don't carry the load.

I thnk the press uses this as a crutch alot.

SAS

7/10/2006 08:28:00 AM  
Anonymous Anonymous said...

Can anyone comment on purchasing a house with an active underground oil tank ?

THANKS

K

7/10/2006 08:43:00 AM  
Blogger chicagofinance said...

Everything moves in cycles, and very little is immune. We are too far into 2006, so it is clear that Wall Street bonuses are going to prop up a portion of the Spring 2007 market. However, the spigot is going to turn off sooner or later. All the stuff is interconnected, just learn where the links are......

7/10/2006 09:13:00 AM  
Blogger delford said...

Chicagofinance: Our Wall St bonus's are paid for the most part between Jan uray and MArch, only f ew firms pay it in the Fall.

If Wall St money is goinig to prop uo the marekt in 07, then why did it not prop up the marekt in 2006?

I have been on teh street form anmy years,anfd I know I have posted it many times before, but this JErsey fascination with Wall St money propping up real esate is way over emphasised.

For instance the majorti of people in Bergen County work in or around Bergen county, not NYC.


One final note as fqr as teh bonus pool, do not be too sure that it will be huge this year, the markets have been extremely volatile, and many firm have been whipsawed, especially so in Fixed Income.


Menawhile in my neck of the woods, inventory grows, nothing is moving.

7/10/2006 10:07:00 AM  
Blogger Grim Ghost said...


Can anyone comment on purchasing a house with an active underground oil tank ?


Yes. DON'T.

But if you have to, get ie fully inspected and make sure the owner has transferrable insurance. And budget to get it removed in the few years (maybe when you change your furnace ).

The house should be discounted by a d the cost to get a gas connection + change furnace. If getting a gas connection is not possible, because there is no gas line, discount by $20K at least.

7/10/2006 11:15:00 AM  
Blogger chicagofinance said...

del:

The bulge bracket has had record fiscal 1Q and 2Q so far. Don't look at the markets, look at the revenues and profits of these firms. They are toll takers and proprietary traders. Toll takers make money on volume, and traders make money on volatility. We've had both.

Wall Street money HAS propped up the real estate market this year.

FYI - we've stated this fact on a few occasions here, 25% of gross income in NYC is derived from the 5% of workers in financial services. Also, of the people who commute into NYC to work who live out side of it's borders, 41% commute from NJ.

7/10/2006 11:49:00 AM  
Blogger Richard said...

wall street money has definitely kept the westfield housing market quite healthy this past spring. most houses flew off the shelf within 2 weeks of listing. yes that's a fact. some lingered longer but eventually sold. the inventory out there right now is stuff that's extremely overpriced or just ugly. wall street money also has already bought and that's why seemingly decent properties that fell out of say an initial contract sat for 45-60 days before finally selling at 5-10% less than original asking.

note to everyone. if you're looking to buy in a top town that commutes to NYC, you will have to contend with the wall street money in some fashion. your best bet to play to your favor is to look and buy when they aren't. that means the fall and possibly winter though some wil still buy in anticipation of their bonus but far less. also look at some fixer uppers. wall streeters are never home and don't want to spend time fixing up a place.

7/10/2006 11:56:00 AM  
Blogger delford said...

Chicagofinance: With all dure respect, i do nto agree. As far as the first two quarters, for the stree that is now wncient history. As i have said, i have been on the stree fro quite some time, and I have seen much of thsi before, even right up until the end, and then BOOm something blows up somewhere, and teh firm looses a ton of money, and bonuss are bad, real bad.

I rmember that particulary well in 94/95 98/99/00 in FIxed Income.

Again with all due repsect there is too much emphasis on Wall St money and its impact, I would also like to pint out, that many of these people already have homes, they have bought ayer ago, two years ago 5 and so on.


I would aslo like to pint out that for the most part these people are not stupid, and will not over pay,especially since the know the market is changing, and I am sure they do.

When it was rocking all over, then yes they would over pay, if many others over paid, but not now, and if there is one thing Wall St understands its market psychology.

7/10/2006 02:15:00 PM  
Anonymous Anonymous said...

Hey Bob,

Chow Dog Owner here...I don't hold open houses to sell my home. Due to the fact that my Chow Dog views all potential visitors as DOG CHOW hahahahahahahahah

P.S. You better be careful at these open houses you go to on the weekend. Just remember Chow Doggy loves dog chow hahahahahahahahaaha

7/10/2006 02:58:00 PM  
Anonymous Anonymous said...

I'm with Delford on that one. Prior to my private equity/music business I owned a NASD Member Broker Dealer (employed 30 brokers), in that game for 20 years, most of the young pup's will blow themselves up. Soooo much of the fed funds 1% funny money stuff is still working it's way thru the system. Net net it's gonna be brutal.

7/10/2006 03:25:00 PM  
Blogger chicagofinance said...

This comment has been removed by a blog administrator.

7/10/2006 05:21:00 PM  
Blogger chicagofinance said...

Del and Anon:

We may not be in disagreement. I am referring to specific points in time. SP06 & SP07. Both of you are discussing broad events that occur over the course of years.

Yes, given the chance, the inexperienced blow themselves up. Yes, the greedy and less talented blow themselves up. Yes, to a number of other things.

However. One point of fact that I dispute is that 1Q & 2Q06 has no impact on next Jan-Mar '07 bonus. It does and it is in the books. The two possibilities are a turning off of the spigot. If so, the YTD numbers still stand. If there is a Barings style blow-up, yes, it would negate everything so far. Highly unlikely though.

I would think that a hedge fund blow-up a la LTCM is possibly more likely, but still would be more far reaching in this environement than deep. Kind of Enron-esque.

Another thing, these people are smart, but you may forget that they:

1. lack of time available for proper due diligence

2. are out of their element in dealing with issues of personal financial planning

3. succumb to hubris

7/10/2006 05:23:00 PM  
Anonymous Anonymous said...

Chicago Finance:

Yupp that 1 2 and 3 are a B#@$h :)

In any event there are no Wall Street bonus' big enough to keep the housing game afloat.

7/10/2006 09:17:00 PM  

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