Posted by Jonathan J. Miller -Tuesday, November 30, 2010, 9:57 PM
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It’s time to share my Three Cents Worth on Curbed, at the intersection of neighborhood and real estate.
…This week I broke down the Island by region to see if listing levels changed, or if we are all in this together. The regions are parsed out in the same way that the sales are in our report series. It would be better to look at the neighborhood level but we’d see 25+ lines and the ire of Curbed readers for violating the 4-max data point rule. I picked the last 6 months rather than the entire year to focus on what is happening right now…
Three Cents Worth: Manhattan’s Wild (Upper) West Side Inventory
[Click to expand and read full post on Curbed]
Posted by Jonathan J. Miller -Monday, November 29, 2010, 10:49 AM
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The past week saw me replace blogging with eating. Time to lose some weight.
A supplier (bank) provides a vendor (appraisal firm) tens/hundreds of thousands of dollars worth of work over the year and the vendor wants to show his appreciation and extend the relationship by sending a box of candy and a thank you note. It’s meant to be a genuine sign of appreciation. Not a huge gift like a weekend jaunt to the Monaco via private jet, but a modest symbolic gesture…like sending a thank you note when receiving a birthday gift.
All during the credit boom and continuing through today we get compliance letters like this from banks:
Supplier Gift Policy
November 16, 2010
To: [Appraiser]
Dear [Appraiser],
[Bank] values the working relationship built with you and your firm as a provider of appraisal services. A very important aspect of this relationship is maintaining the independence of our respective roles related to the valuation of commercial real estate in support of the Bank’s credit transactions. During past holiday seasons, we have received gifts from suppliers that have been taken as an expression of appreciation of our working relationship. However, supplier gifts have the potential to create perceptions of less than strict independence and even conflict of interest. So, while we appreciate the wide variety of holidays and associated traditions at this time of year, we encourage you to refrain from sending gifts to individuals within our group or to the group as a whole.
Thank you for your consideration and, of course, your services to [Bank] in the future.
Sincerely,
I do realize that this gesture can and was abused but where is the line for common sense?
I remember during the credit/housing boom, we got these letters while I observed collusion and self-dealing that banks, mortgage brokers, Wall Street firms and others were perpetuating.
Translation:
I can’t give you a box of chocolate but if I never kill a transaction by appraising something low I will get lots and lots of work [wink].
In our jaded post-credit crunch world I still find it especially grating and hollow to receive these letters in our newly found “awareness” of the problem.
I have an idea! Let’s regulate the &^%* out of everything and like a rare disease then we’ll never see this problem again.
Right.
Posted by Jonathan J. Miller -Tuesday, November 23, 2010, 10:46 PM
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It’s time to share my Three Cents Worth on Curbed, at the intersection of neighborhood and real estate.
…This week I thought I’d match up the Manhattan housing [market] to the U.S. market and throw in a little New York City by way of absorption. Of course real estate is local (blah blah blah) but I thought I’d see what happens – we keep saying Manhattan is different than the rest of the country…
Three Cents Worth: Manhattan Absorbs The Turkey
[Click to expand and read full post on Curbed]
Posted by Jonathan J. Miller -Tuesday, November 23, 2010, 10:33 PM
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Domino Sugar?
A little more than 24 years ago we launched Miller Samuel (October 1986), just one year before the October 1987 stock market crash, as NYC was about to fall into a severe economic and housing downturn, culminating in the 1990-91 recession – mild for the US but severe for NYC. As a small business owner in NYC we are seeing our tax burden rise and our health care costs see double digit annual growth for more than decade.
Harvard economist Edward Glaeser writes an interesting piece in City Journal: Start-Up City: Entrepreneurs are the heroes of New York’s past and the key to its future. It’s about the entrepreneur as an economic engine that needs to be nurtured during periods of economic retrenchment and boy, do we have a structural disfunctional doozy.
Most within the residential real estate industry are by their very nature, entrepreneurs, whether or not they work for a large firm: real estate brokers, real estate agents, real estate appraisers et al.
studies have shown that all over the country, entrepreneurship—along with January temperature and education—is one of the three great predictors of urban success. But nowhere is that more the case than in Gotham, whose very history is a tale of entrepreneurship. To survive, New York must continue to bring forth innovators who will reinvent the city—with luck, making it more economically diverse. If they succeed, it will change as much between 2010 and 2050 as it did between 1970 and today.
Think about past industries that dominated the NYC economy:
- Sugar
- Garment
- Printing/Publishing
- Financial Services
- ????
The Department of Labor statistics show that the No.1 employer by this year will be “self-employment.” Approximately, 10.5 million workers were self-employed in 2007, and that number is expected to jump markedly, according to the DOL. Self-owned businesses now make up about 80 percent of the GDP.
Not to get all preachy but government walks a fine line trying to turn this economy around: different regulations and oversight is probably needed to reduce the odds of what just happened from happening again in our lifetime – but too much regulation and oversight will delay the economy from getting traction for many years.
Let’s at least make sure we give entrepreneurs some breathing room. And plenty of sugar.
Posted by Jonathan J. Miller -Monday, November 22, 2010, 12:59 PM
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The Real Deal Magazine has re-entered the video fray with an interview series hosted by reporter Adam Pincus. As far as I know, they were the first NYC housing market podcast and videocast publishers way back when.
I’ve been reading the magazine since it’s inception – how can you not subscribe to it and actually follow the market?
When founder Amir Korangy reached out to me for this segment, I eagerly accepted since my kids still maintain my “no talking about housing markets at home or I am going to put my hands over my ears” ban.
I speak to the rash of high end sales as of late and whether this will trigger more new development.
Posted by Jonathan J. Miller -Friday, November 19, 2010, 2:58 PM
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I got to catch up with Bob Dorsey, Chief Data and Analytics Officer of FNC which he is a co-founder. Bob is a principal force behind their US residential housing price index that combines public record data and data collected from appraisal reports submitted to lenders.
The index takes a different approach than the primary indices already in use, namely Case Shiller, FHFA and NAR Existing Home Sales. It’s an intriguing approach to refine the accuracy of measuring housing markets.
Check out the podcast.
The Housing Helix Podcast Interview List
You can subscribe on iTunes or simply listen to the podcast on my other blog The Housing Helix.
Posted by Jonathan J. Miller -Thursday, November 18, 2010, 11:25 AM
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[click to expand]
Trulia released its Price Reduction Report for November 2010.
…”Price reduction increases in many large U.S. cities can be attributed to the basic principle of supply and demand – on that score, buyers clearly have the advantage this holiday season,” said Tara-Nicholle Nelson, consumer educator, Trulia.com. “The market is flooded with distressed homes that are priced to sell and individual sellers are having a tough time competing. These dynamics, along with a shallow pool of active buyers, are leading to increases in price reductions.”…
[click to expand]
My own take on the 27% price reduction is less dramatic and perhaps suggests a hint of seasonality returning to the market. This is a new metric with about 1.5 years of data so historical perspective without the influence of a federal tax credit is not available to us yet. The fact that the amount of price reductions is similar to the same period a year ago is pretty interesting. The sharp drop this spring is clearly correlated with the April 30th expiration of the tax credit.
As we move forward with this metric, I suspect seasonal patterns will emerge. I would expect this metric to rise over the summer months and during the last two months of the year which are the periods following the “two-hump camel” of rising sales in the spring and fall. Sellers realize they miss the market and drop their price.
Top 5 cities with highest number of price reductions
[click to open full list]
Top 5 cities with lowest number of price reductions
[click to open full list]
November 2010 Trulia Home Price Reduction Report [Trulia.com]
Posted by Jonathan J. Miller -Wednesday, November 17, 2010, 11:36 AM
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[click to play]
I did a 4 minute interview today with Lisa Murphy on Bloomberg TV’s “Fast Forward” about the state of the US housing market as hearings begin in Washington covering the foreclosure “robo-signing” scandal.
An important first for me: of the 100+ times I’ve been in a green room prior to a TV interview, Bloomberg now has a GREEN green room (their other green room I have been using is pink). Disorienting but I digress.
It’s been an interesting past couple of weeks as servicers press forward with an onslaught of spin suggesting that the hundreds of thousands, if not millions of documents signed without proper review or notarization was merely a clerical issue and everything is fine. You can’t make this up.
Bottom line: housing doesn’t actually recover until employment sees meaningful improvement.
Posted by Jonathan J. Miller -Tuesday, November 16, 2010, 5:56 PM
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It’s time to share my Three Cents Worth on Curbed, at the intersection of neighborhood and real estate.
…Its been a while since I looked at foreign exchange rates applied to Manhattan housing prices. I expanded a bit past the Euro and picked a handful of rates (complying with Curbed readers’ requirement of 4-or-less data points) to apply to Manhattan median sales price. With the weaker dollar of the past year, there has been a lot of talk and anecdotal discussion about foreign buyers in the market. It’s not as if Europe is booming these days, but the Euro is stronger than the dollar and that drives real estate activity here…
Three Cents Worth: Manhattan Market Gift Exchange
[Click to expand and read full post on Curbed]
Posted by Jonathan J. Miller -Tuesday, November 16, 2010, 10:00 AM
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Point2 is a marketing service for real estate agents – they survey their real estate professional members across North America to get a sense of how they feel about their current and future market conditions.
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Several months ago I commented how both the US and Canadian real estate brokerage community seemed to take a very gloomy outlook for the housing market once the contract expiration date of the US federal tax credit for housing was reached. Now that the closing date for the tax credit of September has passed there was an increase in confidence.
Was this change in direction because of a perception that the housing stimulus is over? Or just a one month blip? Who knows.
I realize this is an exercise in correlation, not causation.
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