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Some people argue that this area didn't see the same type of crazy speculation that places like Nevada or Florida saw, so we won't see the same type of problems.
It's true -- metro areas like Las Vegas, Los Angeles, and Miami saw bigger bubbles than we did in NY.
But a look at the annual price appreciation rates in this chart shows that NY-metro still has quite a bit to fall. It pretty much stayed close to the national average bubble rate, but so far on the way down it's not yet fallen as much as the national average has fallen. It would seem it has some catching up to do.
my ancedotal evidence, based on comparable sales in my neighborhood during the peak, is that my property value increased 75% during the bubble.
if I were to sell today, I'd probably list at 45% higher than the beginning of the bubble. This represents a listing price of around what a neighbor sold for in 2003.
my ancedotal evidence, based on comparable sales in my neighborhood during the peak, is that my property value increased 75% during the bubble.
if I were to sell today, I'd probably list at 45% higher than the beginning of the bubble. This represents a listing price of around what a neighbor sold for in 2003.
I agree with Tahiti. Those numbers are spot on.
One of the reasons I am exploring LV is that homeowners in that part of the state are much more realistic in their expectations of where prices are today and where they are headed.
I have seen a lot of nice homes in the area listed for 03 pricing and closing at 02 levels. In my neck of the woods homeowners/realtors have their heads stuck in the sand.
I think overall we are heading back to 99-00 levels before we stabilize. Taxes are higher and the financial system/NJ economic landscape will take years to recover (if ever?).
We bought our hosue in Maplewood (3BR 2.5 BA) for $370,000 in 2000 sold in 2003 for $508,000. In early 2007 houses on our old street were selling in the high sevens to low eights. On zillow now (not reliable but a starting point) our old house is listed at a value of $560,000.
We bought our hosue in Maplewood (3BR 2.5 BA) for $370,000 in 2000 sold in 2003 for $508,000. In early 2007 houses on our old street were selling in the high sevens to low eights. On zillow now (not reliable but a starting point) our old house is listed at a value of $560,000.
Zillow is all over the place with their estimates. For some areas it correlates well, for others it's a random number generator.
You can access the NJ tax records to see if there have been any recent sales on that street.
We are down 10%, perhaps 15% from the peak in early 2006.
Most analysts suggest we have at least another 10% to fall, perhaps 20%. Gloom and doomers say 30%, but that seems highly unlikely unless the economic outlook darkens considerably further.
From what I can see, most people are not pricing their houses correctly. Many realtors and sellers are still listing houses for 2006 prices. The houses that are selling quickly are the ones that are being priced correctly for the current market conditions.
We are down 10%, perhaps 15% from the peak in early 2006.
Most analysts suggest we have at least another 10% to fall, perhaps 20%. Gloom and doomers say 30%, but that seems highly unlikely unless the economic outlook darkens considerably further.
According to Case-Shiller prices were exactly 15% off from peak in December 2008 in the NY metro
As I mentioned in another post it is not unreasonable to have a 60%-70% correction because of the following
there are four reasons prices will go back to 90s prices
-return to historical trends (this takes care of deleverage)
-reduced premium for living close to NYC. (ie median income decrease)
-NJ property tax increase since 2000
-recession overshoot.
In fact Shiller himself believes that we are halfway through the corection. Before interpreting this as a statement for the NY metro area, correction here has just started while there is already a 50% correction in FL
Here's a recent interview by robert shiller of Yale U. Keypoints
House prices are still only halfway back down to fair value.
As I mentioned in another post it is not unreasonable to have a 60%-70% correction because of the following
there are four reasons prices will go back to 90s prices
-return to historical trends (this takes care of deleverage)
-reduced premium for living close to NYC. (ie median income decrease)
-NJ property tax increase since 2000
-recession overshoot.
In fact Shiller himself believes that we are halfway through the corection. Before interpreting this as a statement for the NY metro area, correction here has just started while there is already a 50% correction in FL
Here's a recent interview by robert shiller of Yale U. Keypoints
House prices are still only halfway back down to fair value.
In Japan there was a 66% correction in the 90s and the prices have stayed at that level since then.
As I mentioned suggesting that the bottom is near without historical data is not only unreasonable but also suspicious.
I admire your perspetive on the issue, and I really I hope your right... But honestly, I really do not think there is any possibility of seeing a correction of 50%.
Sure no one knows whats going to happen, but I'd simply say don't count on it. Be realistic and consider the possibility that prices may fall another 10%... maybe 20% if things really tank around here, and 30% and all hell breaks loose.
Be realistic and consider the possibility that prices may fall another 10%... maybe 20% if things really tank around here, and 30% and all hell breaks loose.
I am realistic. In fact, I argue on real data and not hearsay or fear. Also, the "hell break loose" means nothing. House values were in accord with the historical trend during 90s and hell did not break loose, in contrast economy was strong. Also today's S&P fell to 1997, meaning effectively that 50% of our 401k has vanished and hell did not break loose.
As long as there are people that think there are bargains to be had during this correction we will not see the bottom. Bottom is reached when no one sees any reason to buying a house but to live in because it is mostly a liability. Just like Tokyo for the last decade.
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