New York City Real Estate | NYC, NYNew York City Real Estate | NYC, NYNew York City Real Estate | NYC, NYNew York City Real Estate | NYC, NY
  • ABOUT
    • ABOUT SCOTT
    • ABOUT THE TEAM
    • PRESS
  • BUYERS
  • SELLERS
  • VIDEOS
  • LISTINGS
  • JOIN OUR TEAM
  • BLOG
  • CONTACT
  • CALL SCOTT NOW

The Election, the Stock Market & the Impact on NYC Real Estate

    Home Newsletter The Election, the Stock Market & the Impact on NYC Real Estate
    NextPrevious

    The Election, the Stock Market & the Impact on NYC Real Estate

    By admin | Newsletter | Comments are Closed | November 15, 2012 | 0

    The Presidential election became a bit of the sideshow attraction to Hurricane Sandy.

    I was supposed to do a small gather and chat on the impact of the election on the New York City Real Estate Market, but it was scheduled for October 30th.

    Coincidentally, this was the day the hurricane did its worst.

    I’m doing a post on the Hurricane, so we’ll leave that discussion to the side.
    The question was, “How will the election impact the Real Estate market?”

    Is there an echo here?


    My answer, given that we now know President Obama has another four years in office, is actually pretty tempered, and short:

    I believe that the

    New York City Real Estate Market will the continue to be a place of safety for the world, a place to park money, and even at very low returns won’t be too much of a deterrent.
    Also, I believe that the power of low lending rates, especially when most people feel that the artifice of it has to end at some point- bringing in expected inflation- will continue to overpower of whoever was going to win.

    That is, the real estate market is larger than either of the candidates, as is the market more broadly.
    Of course, we’re a week in the future, and the stock market has dropped 10%.

    But does that have anything to do with the Election?

    Honestly, I don’t think so.
    The concept of Real Estate as a safe haven hasn’t changed.

    Frankly, it may be more true now.

    My conversations with different investment professionals led me to believe that the stock market had “baked in” a win for Obama.

    With that in mind, were portfolio managers really secretly expecting a Romney win?

    The win seemed so unlikely, so call me skeptical of that theory.
    To see the stock market lose steam as it has is very concerning, but there are different areas which need

    addressing, if we’re going to understand the impact post-election on the RE Market, if it has anything to do with the Election.

    They are:
    1) Fiscal Cliff and its tax ramifications on Real Estate
    2) Europe’s woes and how it echoes here
    3) Unemployment- is employment improving here?
    First, the

    “fiscal cliff.”

    Real Estate investors have little, if any, time to sell properties between now and end of year.

    Most residential sellers have little control of lender timing, co-op timing, and I would argue that few transactions are going to be able to avoid the cliff, if there is one.
    I would argue that sellers are accepting of their fate, whatever it is, six weeks from the end of the year.

    With that said, assuming the issues get resolved between now and the end of the year (and they probably will go into the holidays, given the general nature of negotiations), it will happen last minute, and we’ll then see sellers able to do their capital gains math- and we’ll probably see more inventory coming on the market in the New Year.

    There’s been some discussion about stock selloffs to preempt these fiscal cliff discussions, but I would see most investment professionals only selling securities they feel are at a price where it’s worth taking money off the table.

    If the stock market ‘s correction is because of tax concerns, I would be surprised.
    Which leads me to the second part.

    Europe.

    Is there some echo on the RE Market here?

    Is Europe suddenly more in focus because one candidate one or another?
    Perhaps the concerns about Europe have finally filtered into the market, but this will likely strengthen the RE market here- and I would think it highly unlikely that the election did one iota to change opinions of what’s going on over there.

    Europe, apart from Germany, is out of money, and lacking in magic bullets.

    Their economies are in trouble, and there’s little they can do to fix it, other than wait for people to bail them out, buy their assets, and let the rising tide of China and the US help things ease.

    It’s pretty ugly.
    Any European investors with money on the sidelines, who pulled it out a long time ago, will continue pushing into hard assets, including very cheap European assets- and US real estate.

    In New York City, they are most interested in multi-family here and office- but as inventory is generally running on fumes in all sectors, there’s a lot of chasing going on in residential, too.
    I expect to see an uptick in seller confidence in the new year, and we’re seeing it already, that should more than overcome capital gains concerns and has a lot to do with the pace of the market.

    Residential Prices have been going up and they should continue doing so.

    Anecdotally, bidding wars are happening all over for even one-bedroom units now.
    Third, unemployment.

    While the numbers look pretty dismal across the country, I’m seeing a truly shift into New York City of tech startups, legal, etc- all which point to a strengthening of the employment market in New York, with the “right” kind of jobs that add value to the economy.

    Construction will pick up, has picked up already, and given the storm, we’ll see a stronger pickup in New York City.

    We’ll see federal and state dollars plowing into the area as well.

    Our Brown Harris Stevens economist is tracking employment numbers carefully- and he argued last month that the unemployment numbers were underreported nationally- which seems to be shifting now- one of the post-election realities- and unemployment numbers seem to be overreported here.
     

    apartment listings, apartment ownership, bidding wars, brown harris stevens, Condo sales, condominiums, mortgage rate, nyc mortgages, NYC Real Estate, selling new york

    NextPrevious

    Recent Blog Posts

    • (VIDEO) Celebrating 150 Years In Residential Real Estate- And my 20th Anniversary, too. January 31, 2023
    • How to Make An Extra $1mm on the Sale of Your Townhouse January 30, 2023
    • What’s Going To Happen To All The Office Space In NYC? January 30, 2023
    • NYC, Manhattan, and The US: A Reversion To The Mean January 30, 2023
    • The Best Lead Measure in The NYC Housing Market Right Now January 30, 2023
    • How To Think About Mortgage Rates Right Now January 30, 2023
    • Are You In, or Are You Out Of New York City? The End Of Ambivalence. December 22, 2022
    • Mortgage Math- How To Spend LESS on Your Mortgage Right Now – What No One Is Telling You December 22, 2022
    • Selling To An Insider Could Cost You $150,000 December 22, 2022
    • The Unintended Consequences Of Higher Loan Limits on “Conforming Loans” November 30, 2022

    Archives

    Call us: (646) 400-0769
    Email us: sharris@bhsusa.com
    Visit us: Brown Harris Stevens
    1926 Broadway
    New York NY 10023

    © 2023 The Harris Residential Team. All rights reserved.
    • About Scott Harris
    • About the Team
    • Press
    • Buyers
    • Sellers
    • Videos
    • Listings
    • Blog
    • Contact
    • Call Scott Now
    • Brown Harris Stevens Fair Housing Policy
    • ABOUT
      • ABOUT SCOTT
      • ABOUT THE TEAM
      • PRESS
    • BUYERS
    • SELLERS
    • VIDEOS
    • LISTINGS
    • JOIN OUR TEAM
    • BLOG
    • CONTACT
    • CALL SCOTT NOW
    New York City Real Estate | NYC, NY