NYC Metro area home prices to fall 15%, says economist Ken Rosen (Newark: sales, real estate)

[GiantRutgersfan]

New York Area Home Prices to Fall 15%, Rosen Says (Update1) - Bloomberg.com


I would tend to agree....

[JG183]

I wouldn't

[Marc Paolella]

Idle worthless speculation. Some areas in the metro area might fall 15%, other areas might increase. I just recorded an increase for Randolph, NJ, which is in the NY metro area. The median home price in Randolph for the 6 month period ending today is $475,000. The median home price for the same period last year is $450,000. A 5.5% increase. In Ridgewood, the median home price for the 6 month period ending today is $665,000. The median home price for the same period last year was $612,000. 8.6% increase.

Are Ridgewood and Randolph going to drop 15% in the next 12 months? Don't have a clue. It seems unlikely but who knows?

I am starting to see year over year declines starting to decrease in many middle of the road towns. In Roxbury it was running 15%, now it's dropped to 8%. Perhaps the decline is beginning to slow and the bottom is close. Or maybe not. It could be a pause before further declines.

Bears love to selectively isolate negative data and always predict Armageddon. It's more a reflection of emotional disturbance then anything else. Bulls do the same thing but are always doing their happy dance. Neither side is worth a damn, because the predictions are based on emotions rather than reality.

The bottom line is the bearish and bullish prognosticators are equally bankrupt, and both should be ignored. Read the data, think about the data, and come up with your own conclusion.

-Marc

[MoorestownResident]

Would seem unlikely. Some of the hardest hit towns in the Short Hills area, perhaps some in Bergen County could take it on the chin a while longer. However, layoff announcements are beginning to slow and the economy is beginning to stabilize, albeit too early to say we're out of the recession though it is now looking like the 2nd half of this year might return to slow growth environment.

[elflord1973]

Originally Posted by Marc Paolella

Bears love to selectively isolate negative data and always predict Armageddon.

Why is it that bubbles are seen as "positive", corrections seen as "negative" ?

Asset bubbles are not only bad for those who are thinking of buying the asset in question, they are also terrible for the real economy.

PS one doesn't have to exert too much effort to "isolate" data that predicts falling prices. Whether it's the Case Shiller index, or the Case Shiller futures market, or long term valuation indicators (like the HOI index), the trend in aggregate is downward.

It's very difficult to interpret your data on Ridgewood because unlike Case Shiller, they aren't using matched sales pairs.

[ghuber]

Seems pretty likely to me, especially if we keep shedding jobs and consumer confidence does not begin to recover soon.

[tahiti]

i would think realtors would love price drops, as it opens the market up for more potential (LEGITIMATE) buyers.

[elflord1973]

Originally Posted by tahiti

i would think realtors would love price drops, as it opens the market up for more potential (LEGITIMATE) buyers.

Yeah, you'd think it would be in their interests for the correction to run its course. Sales are slow partly due to the fact that the market expects further declines, and partly because there aren't many who can afford 2005 prices in the 2009 credit environment.

Here is the affordability graph for Newark-Union, NJ-PA region again:



and here is the median price / median income for the same region:

[halfoffpeak]

TODAY'S NEWS

1. Banks are stepping up foreclosures after a brief moratorium due to the government request.

Banks Ramp Up Foreclosures - WSJ.com

2. Mortgage applications to finance the purchase of homes and to refinance existing loans fell last week even as U.S. home loan rates treaded water just above record lows.

Mortgage Applications Slide, Rates Tread Water - Real Estate * US * News * Story - CNBC.com (http://www.cnbc.com/id/30222710 - broken link)

NJ housing market will have larger declines this year 2009 than 2008 as it remains unaffordable (high prices and high taxes) amidst the worst recession since depression. Buying a house now is surely a losing move.

[JG183]

Originally Posted by halfoffpeak

Buying a house now is surely a losing move.

of course it is

...if you're planning to sell it in the next 12 months

otherwise, it's a place to live, that in 5-10 years
will turn out to have increased in value.