NYC real estate market reaching peak, abt to crash? (New York: credit, house)
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What do you think? Looks like there is already an oversupply and aggressive building continues. Foreign buying of NYC real estate has slowed a bit as dollar strengthened. It looks like luxury nyc real estate will take a big hit soon. I wonder if it will trickle down to the outer boroughs as theyve seen prices rise in recent months since manhattan is too expensive. I am in the market to buy but think i will hold off and see what happens.
market crashes do not happen because of slow downs . in fact i have been an investor in nyc real estate for 30 years . i have seen what i would call only 1 crash here . 1987 after the stock market crashed . i can't even say 2008 . it was a dip but we sold not 1 but 2 property's that year and for just 10% less then the all time peak .
nyc real estate is far from crashing . it just has cycles where sometimes things are better then other's but over all we have a very strong market with no let uop in sight . even rising interest rates would be good as rising rates mean the economy is doing better with more jobs , more pay and more demand .
when rates rise people feel pressured to buy before they can afford even less house .
Agreed. It's not going to crash, it will dip but that's normal in the real estate cycle like anywhere else. You're not going to see crashes like in Florida , Arizona, or Nevada. NYC is a very unique place.
All asset classes are going to crash like the Titanic including real estate. Wait for the market bottom, then buy solid, profitable companies with low debt. The dividend aristocrats are a good place to start. And don't buy real estate directly, invest in REITs.
It can't crash because lots of properties here have been held for a very long time and the owners are very wealthy that can wealthy through hard economic times. What will happen is a recession will take out a lot of over leveraged folks. Then folks that are wealthy will come in and buy on the cheap including those foreigners loaded with cash. That's how many Chinese got into properties when the market got soft and they can come in with cash and folks with credit all got kicked out of the market.
It can't crash because lots of properties here have been held for a very long time and the owners are very wealthy that can wealthy through hard economic times. What will happen is a recession will take out a lot of over leveraged folks.
Do you think any high-rise building going up today is not highly levered? Even the oldest properties are remortgaged to take out equity that can be used as a down payment for more debt to permit more building.
I am sure we would all boggle at the level of NYC housing debt that is out there, probably far more than existed in 2007.
We are seeing vast increases in housing costs coupled with a poor economy (see previous post.) That used to be called STAGFLATION but former economic times used to be more honest about what was going on.
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