My feelings on the market mid-November 2010.
Lots of paranoid schizophrenics, and people standing in the middle of the street yelling.
A colleague of mine put it very well- Schizophrenic.
One week it’s up, another week it’s quiet.
It feels that like it’s moving forward, with deals happening- but just to prove that real estate markets have a strong element of psychology to them, an article in Friday’s NY Times on SoHo and the old Artist-In-Residence laws put people totally over the edge during the weekend.
What do I think?
I think that anyone who wants to finance is hitting honest boundaries at most lending institutions.
If you think that the laws here are draconian, just think about how an underwriter in Nebraska must view them.
These nice folks assess the risk on loans here.
Frankly,
I don’t see many people walking away from their 20-30% downpayment on $2-10million properties here- And through the entire downturn, the foreclosure rate in Manhattan proper is miniscule.
But Joe Underwriter certainly needs to know whether his boss can recoup the loan if an owner does walk- and I can respect that.
The pendulum swung all the way to insanely difficult in 2009 and 2010, but I feel like it’s not that difficult for a qualified buyer to get a mortgage right now.
That, and the natural need for housing, bigger housing, smaller housing, continues to drive the market.
My team and I are
seeing more Europeans and Israelis in the market- the housing market is very strong is those locations- so NYC looks cheap.
I do not disagree.
I will provide my view on the market here, but there is a lot of information out there.
I feel that if inflation happens, being in hard assets will be the right move.
Certainly, investing in NYC real estate, especially in Manhattan, with prices down 10-20% across the board, is making many investors warm and fuzzy.
Money is cheap, and while depending on the purchase (apartment or building), the returns are not overly sexy,
one can almost make the argument that there’s a decent return cash-on-cash- that is, it’s not just about banking on appreciation.
Although, it mostly still is.
I like to think that I never wore rose-colored glasses when it comes to this market, and depending on the need, and the time one wants to hold a purchase, there are different answers to how the market is doing.
It is not black or white.