Top Broker: NYC Real Estate Already in Steep Decline

[tpsbmam]

Source: ABC News

Manhattan's finest co-op apartments may have already lost a fourth of their value as a result of the financial crisis, and the worst is yet to come, says leading New York estate broker Kathy Sloane, of Brown Harris Stevens.

An owner of a five-million dollar Park Avenue apartment, only an average residence by investment banker standards, "may be lucky to achieve $3.5 million" a month from now, said Sloane, whose clients have included celebrities, the super-rich and prominent families including the Clintons.

"If someone saw a bid between $3.8 million and $4.2 million from a qualified buyer, take that bid," said Sloane in an interview to be broadcast on 20/20 Friday night.

"You can be Lehman Brothers or you can be Merrill Lynch, meaning you can go down with the ship," she said, "or you can say, look, there's a huge storm about to crash and we need to get to higher ground and make a plan."

Read more: http://abcnews.go.com/Blotter/story?id=5832116&page=1

---

Before you saw, awwwww, poor rich people.....the New York City economy is going to take a huge hit as a result of all of this.

http://www.usatoday.com/money/economy/2008-09-15-new-york-city-bloomberg_N.htm

A city whose economic fortunes are closely tied to Wall Street's ups and downs braced Monday for fallout from the collapse of one financial pillar and the sale and likely restructuring of another.
Economists and city officials said the nose dives could lead to the loss of thousands of jobs and affect the livelihood of everyone from real estate developers to limousine drivers.

Financial experts were reluctant to speculate how many would be out of work after Lehman Bros. Holdings filed for bankruptcy protection and brokerage firm Merrill Lynch(MER) was sold to Bank of America (BAC).

New Jersey, Connecticut and suburban New York counties also could take a hit, because thousands of Wall Street executives and workers live there.

................

Still, the salaries and hefty bonuses traditionally earned on Wall Street pump cash into everything from restaurants to high-end co-ops and hired-car services and have a larger impact on other local businesses and tax revenue than any other industry.

"This multiplier effect will have a serious impact not only on the financial-sector employees who lose jobs but also on many New York families who are indirectly affected by those job losses," said Bloomberg, who noted that one job on Wall Street generally creates at least two others in the city.

[Hestia]

1. Sorry, when I live in a town a huge amount of homeless, it's a little hard to get my heart tugging

over the fall of a $5 million co-op. Real estate has fallen here too.

[tpsbmam]

4. Yep, and it's hitting your town just like it is all over the country...

tax revenue is down most places. NYC was one of the few places that hadn't been hit much -- before this, real estate was down about 7%. This affects the city in terms of decreased revenue and tax revenue and it affects the "little people" whose incomes depend on the New York rich -- maids, car service/limousine drivers, waiters & waitresses, dishwashers, and so many more. This isn't just about rich people who have to give up their opulent apartments.

[readmoreoften]

2. What they can't find Europeans and Asians who want cheap American lofts?

NYC is the 22nd most expensive city in the world. A great buy for everyone else.

[Tansy_Gold]

3. Right. We don't want to stop the "trickle down" effect

THAT NEVER EXISTED IN THE FIRST PLACE.


:grr:


What's the alternative? Keep propping up Wall Street and the lunkheads who take home billion$ so they can hire nannies who work 14 hour days, 7 days a week, for $3/hour? Where do you think those billion$ are coming from? THEY'RE COMING FROM THE TAXES PAID BY THOSE MINIMUM WAGE WORKERS.

The administrative assistant who makes $30k and the janitor and the waitress and the cook and the doorman -- these people ALL PAY TAXES ON EVERY FUCKING CENT THEY EARN, or at least on a hell of a lot more of them than the broker making $5,000,000 on his options and bonuses and short sales and all the other low-tax-bracket moola he's taking home.

This is typical right-wing misplaced sympathy. THEY DON'T CARE ABOUT THE LITTLE GUY; they only care about protecting their outrageous income and obscene lifestyle.

Let them fall. Let the "free market" be really free for a change. Let real estate values fall back to something reasonable.

This country's economy has been borrowing against its future for years. When you end up in more debt than you can repay, YOU STOP SPENDING. You live within your means and you pay back what you owe. You survive on all the shit that you've already bought -- clothes, cars, furniture, shoes, jewelry, $6000 shower curtains and all -- and you MAKE DO.

There is no MAKE DO mentality in the world of Wall Street any more. It's "GIMME MY MILLIONS or the little guys I tip $1 will go hungry."

Assholes. They're all assholes. Because the little guys will go down the tubes either way. THEY'RE only hope is that the fat cats go, too, and something resembling sanity returns to the economy sooner rather than later.

Assholes. They're all assholes.


Tansy Gold

[tpsbmam]

5. Absolutely....

couldn't agree more. But it still DOES affect all of us, we who don't live like that and who don't have those millions/billions. It's not about trickle down, it is for me about the people who WILL be hurting due to all of this. I don't give a shit about the mucky-mucks who were making millions/billions. I do care about the waiter who loses his job because the previously successful restaurant he worked in closes. And THAT is happening all over the country.

[Tansy_Gold]

11. The point is, it's going to effect the little people ANYWAY.

(And I can't believe I all-capped a spelling error! argh!)


Again, though: In trying to elicit sympathy for the little people, who will REMAIN little people and remain vulnerable and remain footing the bill, the real motive is to protect the rich. This is the same mentality that has people voting against their own best interest when they say "We shouldn't tax multi-million dollar estates with a 'death tax' because somebody might leave me a big wad and I don't want to have to pay taxes on it."

Fact is, we ain't gonna inherit big bucks, but we think we might. Stupid. It's utter stupidity.

And the same logic, the same false sympathy, has us emptying our pockets and our bank accounts and the US Treasury to keep billionaires from becoming mere millionaires.

Let them fall. Let them become ordinary folks like the rest of us. Then maybe some of US would be able to have real jobs with real wages and WE would be able to patronize those restaurants and leave better tips than the wads on Wall Street.

Tansy Gold, who really really really apologizes for that "THEY'RE" which should have been a "THEIR"

[fed_up_mother]

6. Funny how the misery does trickle down, though

Things are going to get bad for a lot of ordinary, hardworking New Yorkers, I'm afraid.

[NashVegas]

7. It's Mostly Going to Hurt People Who Buy For the Investment

And as someone who would love to buy, but wants a place to LIVE for 15-20 years - everything that's not in a high crime area starts at 4-5x my salary - boo freaking hoo.

[dipsydoodle]

8. An owner of a five-million dollar Park Avenue apartment......

....may be lucky to achieve $3.5 million.

Life can be such a bitch sometimes. :sarcasm:

[tpsbmam]

9. London, New York Stand to Suffer

What is so difficult to understand here? Here's another article. I don't give a shit about the rich developer -- I do give a shit about the lost tax revenue. I don't give a shit about the stores for the rich (that also pay taxes) -- I do give a shit about the sales persons who work in the rich stores. I know one of them who already lost her job in one of those rich people stores because in the past 6 months, the store started losing money and finally closed -- she didn't make much but she made enough to pay rent, etc and she hasn't been able to find another job yet. She's young and thank goodness has parents who are able and were willing to prop her up temporarily but that time is up -- they can't afford to do it anymore and she has to move home. Lucky her she has a home to move back to! And it's not just the boutique stores -- there will be further hits at stores like Macy's, which has already had mass layoffs. I'm not thinking about what theoretically should or should not have happened on Wall Street -- I'm thinking about the people who rely on this income to live very non-millionaire lives. Man, the lack of empathy around here if it's ANYTHING remotely connected with Wall Street is amazing. What don't people get about this affecting all of us?

http://online.wsj.com/article/SB122151112362738359.html?mod=googlenews_wsj

The blast furnace known as the finance industry that has stoked the economies of New York and London for decades is rapidly cooling.

Both cities have relied heavily on the securities industry for jobs, taxes and a prosperity that has lifted restaurants, stores, auto sales, fashion, entertainment and a wide range of other businesses. The future of that largess is in doubt a year into the credit crunch, with the bankruptcy filing of Lehman Brothers Holdings Inc. and the sale of Merrill Lynch & Co. adding to the thousands of jobs already lost -- and the likelihood that more will come.

.........

Jobs in financial services tend to be more important for the overall economy. About 5% of New York City's jobs are in financial services, but they account for about a quarter of wages, some $60 billion in 2006, according to the New York Office of the State Comptroller. That same year, personal and corporate taxes paid by the securities industry accounted for about 10% of the city's tax revenue.

[brentspeak]

10. I don't see how sky-high NYC rents being lowered would affect "many New York families"

The loss of big-spenders at restaurants, etc. yes; but reduced real estate prices are not going to affect waiters, taxi drivers, hair-dressers, etc.

[tpsbmam]

12. I'm a native New Yorker and lived there as an adult until I was about 29....

Believe me, rents won't come down. The prices of apartments that people buy will come down but rents won't. The prices of condos and co-ops coming down won't help the vast majority of New Yorkers who can't come close to affording a NYC apartment.