Manhattan real estate: Going down

Ever since the national real estate market started to tank, we've been watching Manhattan. That's partly because we used to live there, partly because we have good friends and family there and partly because New York housing—the high end at least—seemed impervious to the meltdown. That last point would appear to make Manhattan a bellwether of sorts for Marin.




A Bloomberg story today suggests though that even Manhattan is beginning to feel the real-estate crash. Apartment sales are falling, inventory is climbing quickly, and agents are starting to manage the expectations of their clients—especially in the "middle-luxury" category for $3 million to $7 million apartments:

``In 2006 and 2007, they looked at the last 12 months' worth of sales and priced their apartments at 10 percent more,'' [Brown Harris Stevens broker John] Burger said. ``Today they are sitting down with the soon-to-be listing broker and saying `Do you think we can get what they got in '06?'''

[Miller Samuel President Jonathan Miller] estimates the number of deals closed in Manhattan has fallen 6.4 percent and [Gregory J. Heym, chief economist for Terra Holdings LLC] says they have dropped about 4 percent. Neil Binder, co-founder of the Bellmarc Cos., said contracts signed at his firm in January and February were down 20 percent.

Manhattan real estate at the high end, like Marin's, has tripled in value during the past decade.

However, New York's market may well be responding to trouble on Wall Street, with the most financial sector jobs being lost in seven years, Bloomberg reports. By contrast, employment in the Bay Area is brisk, and has yet to flag—especially in Techland. Indeed, our friends at tech companies complain that it's nearly impossible to find talent these days, with the job scene looking a lot like it did back during the late 1990s.

While that didn't end well, we continue to believe that history won't repeat itself in Techland.