Posted by Jonathan J. Miller -Tuesday, March 13, 2012, 12:54 PM
As shown in the above Bloomberg chart based on our Manhattan data and the NYS Comptroller’s, Wall Street Comp/person and the Manhattan luxury market show similar trending. Not speaking to causation here.
Bad news for sellers? So the logic follows that with a decline in compensation per person in 2011 – largely from a poor second half 2011 performance, luxury prices could slip a bit in 2012 and perhaps the following year if things continue as they were. I said:
“People are making decisions a year or more down the road because they’re getting their deferred cash,” he said. “We may see a little weakness in 2012,” and “next year could be weaker based on this trend of lower compensation.”
Good news for sellers? Some view Wall Street’s poor performance in the second half of 2011 as an anomaly, and with bond trading now on the rise, bank performance could be better next year (or the same if another second half plunge occurs). If the former occurs then there is more potential for greater Wall Street comp and perhaps better luxury housing market performance. I like the above debt chart because it really illustrates how much the industry fell in the latter half of the year. The WSJ reports:
For the first time in a year, traders and bankers are optimistic about the future following a dark second half of 2011. Layoffs, pay cuts and public outrage against the financial industry undermined morale at banks and securities firms, while economic malaise throttled banking and trading businesses.