Welcome to City-Data.com Forum!
U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > U.S. Forums > New York > Long Island
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
Closed Thread Start New Thread
 
Old 06-19-2009, 03:33 PM
 
110 posts, read 224,987 times
Reputation: 49

Advertisements

New York Home Prices Forecast to Drop 40% - TIME

 
Old 06-19-2009, 03:40 PM
 
13,506 posts, read 16,952,802 times
Reputation: 9684
I can't believe it will get that bad, but then again, I hear from people in RE that it is getting really difficult to get people mortgages..even people with good incomes and money to put down. Just hearsay of course.
 
Old 06-19-2009, 04:37 PM
 
Location: Nassau, Long Island, NY
16,408 posts, read 33,180,143 times
Reputation: 7337
This is a very short and not very comprehensive nor well defined article based only on opinions of one group of investment banking analysts at one investment bank (Deutsche Bank). Their definition of "metropolitan New York City (which includes Westchester, northern New Jersey and other nearby areas)" is overly broad. I also cannot fathom why a home for sale in Atlantic City, NJ was depicted in the article, as surely everyone knows Atlantic City, NJ is not considered part of the NYC metro area. But I will give them a pass on that. However, I cannot give them a pass on claiming that real estate in the extremely diverse submarkets (Manhattan, Brooklyn, the Bronx, Queens, Staten Island, Bergen and other counties in NJ, Westchester, and, although they didn't mention them specifically, Nassau and Suffolk, etc.) and the subneighborhoods of those submarkets of the NYC metro area will uniformly fall that much. You cannot lump them all in together like this, as each submarket and the specific neighborhoods within those submarkets are very individual in terms of their local real estate markets.

I think DB's analysts are betting on it falling this much because of one thing almost all of these markets do have in common, which is the lack of affordability, which drove the large bubble burst in California. They are betting that we will follow what happened in California, where a million dollar home can end up sold at auction for $300,000, due to the lack of affordability. I agree that homes in our general area are not priced affordably for the typical salary range here, so I can see that if people can't afford the homes, the homes won't sell until they are more affordable. I think the only thing that could drive our market to go down so much as California's did would be for a revamping of foreclosure. It takes much less time to foreclose in California and that contributed to their bubble burst also, as homeowners had a lot less time to try and get out from under. In the current economic climate, I do not see any changes that would hurry NY's foreclosure process from the typical 9-18 months (and sometimes as long as 3 years) to how it is in California and many other places (3-6 months to foreclosure).
 
Old 06-19-2009, 06:31 PM
 
149 posts, read 350,590 times
Reputation: 16
No real facts on how they got to a 40% loss. I think its way high of a loss for most areas. Some city apartments ect might see that drop, but suburban homes will not drop 40% on LI. No way. If that happens the last of the banks will go out of business. I know I would stop paying my mortgage if I had a 500K mortgage and they suddenly decided my house was only worth 200K.

You will not see houses selling for 1,000,000 on LI selling for 600,000.
You will not see houses selling for 350,000 selling for 140,000
You will not see a 40% loss.
 
Old 06-19-2009, 06:45 PM
 
Location: Long Island
9,918 posts, read 23,024,907 times
Reputation: 5871
Quote:
Originally Posted by I_Love_LI_but View Post
This is a very short and not very comprehensive nor well defined article based only on opinions of one group of investment banking analysts at one investment bank (Deutsche Bank). Their definition of "metropolitan New York City (which includes Westchester, northern New Jersey and other nearby areas)" is overly broad. I also cannot fathom why a home for sale in Atlantic City, NJ was depicted in the article, as surely everyone knows Atlantic City, NJ is not considered part of the NYC metro area. But I will give them a pass on that. However, I cannot give them a pass on claiming that real estate in the extremely diverse submarkets (Manhattan, Brooklyn, the Bronx, Queens, Staten Island, Bergen and other counties in NJ, Westchester, and, although they didn't mention them specifically, Nassau and Suffolk, etc.) and the subneighborhoods of those submarkets of the NYC metro area will uniformly fall that much. You cannot lump them all in together like this, as each submarket and the specific neighborhoods within those submarkets are very individual in terms of their local real estate markets.

I think DB's analysts are betting on it falling this much because of one thing almost all of these markets do have in common, which is the lack of affordability, which drove the large bubble burst in California. They are betting that we will follow what happened in California, where a million dollar home can end up sold at auction for $300,000, due to the lack of affordability. I agree that homes in our general area are not priced affordably for the typical salary range here, so I can see that if people can't afford the homes, the homes won't sell until they are more affordable. I think the only thing that could drive our market to go down so much as California's did would be for a revamping of foreclosure. It takes much less time to foreclose in California and that contributed to their bubble burst also, as homeowners had a lot less time to try and get out from under. In the current economic climate, I do not see any changes that would hurry NY's foreclosure process from the typical 9-18 months (and sometimes as long as 3 years) to how it is in California and many other places (3-6 months to foreclosure).

Excellent comment/points!
 
Old 06-19-2009, 07:41 PM
 
Location: under the beautiful Carolina blue
22,614 posts, read 36,516,975 times
Reputation: 19814
Quote:
Originally Posted by propain View Post
You will not see houses selling for 1,000,000 on LI selling for 600,000.
You will not see houses selling for 350,000 selling for 140,000
You will not see a 40% loss.
Agreed. I don't know anyone who would sell their house for 40% less than it's worth right now, unless they absolutely, positively HAD to sell, and I don't know anyone who's in that position. Plus that would take me, for instance, to right back to close to what I paid for it, and I'm not letting it go for that price - not after 12 years worth of paying mortgage interest and property taxes on it. Those are the intangibles that no one considers!
 
Old 06-19-2009, 07:58 PM
 
327 posts, read 1,059,770 times
Reputation: 136
Quote:
Originally Posted by twingles View Post
Agreed. I don't know anyone who would sell their house for 40% less than it's worth right now, unless they absolutely, positively HAD to sell, and I don't know anyone who's in that position. Plus that would take me, for instance, to right back to close to what I paid for it, and I'm not letting it go for that price - not after 12 years worth of paying mortgage interest and property taxes on it. Those are the intangibles that no one considers!
Thats fine but for the people who leveraged themselves to buy houses in 2005-2006 with arms and alt-a's may be struggling to keep afloat on mortgage payments. If they are already upside down on the morgage or do not have a loan with freddy or fanny they may not be able to refinance.

This also does not include the people who have gotten layed off from their city jobs or the increased train prices or gas prices that are almost back at $3 a gallon. NY State taking away the star program for taxes.

The Obama $8000 tax credit may stimulate the market up but with interest rates going back up to 6%+ something has got to give. I personally think LI wont hit the bottom until 2011.
Attached Thumbnails
NY Housing Article: Any thoughts?-reset2.gif  
 
Old 06-20-2009, 10:05 AM
 
149 posts, read 350,590 times
Reputation: 16
Quote:
Originally Posted by raiser View Post
Thats fine but for the people who leveraged themselves to buy houses in 2005-2006 with arms and alt-a's may be struggling to keep afloat on mortgage payments. If they are already upside down on the morgage or do not have a loan with freddy or fanny they may not be able to refinance.

This also does not include the people who have gotten layed off from their city jobs or the increased train prices or gas prices that are almost back at $3 a gallon. NY State taking away the star program for taxes.

The Obama $8000 tax credit may stimulate the market up but with interest rates going back up to 6%+ something has got to give. I personally think LI wont hit the bottom until 2011.

Never doubt stubbornness of LIers. They would rather you pry their home deed from their cold dead fingers than take a 40% loss. They will simply take their home off the market and make it work somehow.

Of course the desperate will need to get out fast so you will see cases of big drops in houses as their situation becomes more desperate. The only time you will see 40% loss is on short sales or forclosures.

If I were to go fully under and then realize my home was only worth a fraction of what the bank gave me a mortgage for you know what im going to do right? Im going to stop paying my mortgage and go into foreclosure. Id rather the bank take my home from me 6-10 months later than short sale my home for a loss to some lucky buyer. I will squat in the home as long as possible and save every penny I have until that happens.

The bank will then take my home and sell it. A home flipper will buy it most likely and relist it for a much higher price. The buy still wont see the 40%. It just wont happen.
 
Old 06-20-2009, 11:00 AM
 
327 posts, read 1,059,770 times
Reputation: 136
Quote:
Originally Posted by propain View Post
The bank will then take my home and sell it. A home flipper will buy it most likely and relist it for a much higher price. The buy still wont see the 40%. It just wont happen.
If enough houses foreclose the market will get saturated with homes for sale and the prices will have to drop. The banks will list the house for market value not what they think its worth because they are too stubborn to sell it,
 
Old 06-20-2009, 11:54 AM
 
Location: Wallens Ridge
3,122 posts, read 4,932,898 times
Reputation: 17269
40% is a bit high but I believe 20-25% is more realistic. Thank goodness I sold last year
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Closed Thread




Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > U.S. Forums > New York > Long Island

All times are GMT -6.

© 2005-2024, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Contact Us - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37 - Top