New York Manufacturing Index Drops To Lowest Level On Record - What Are The Implications For New York Real Estate?
The outlook section of the survey fell to what I would term as depressionary levels should this trend continue.
With finance and now manufacturing taking a serious hit in New York, this is adding confirmation to a point I made while New York City real estate values were still rising. That being, before this cycle is over, I expect some of the worst real estate problems to be centered in New York City and places like The Hamptons. We are likely still in the beginning stages of a New York real estate decline versus other parts of the country. This is logical given the epicenter of the U.S. bubble resides on Wall Street. Until Wall Street's bubble started to collapse, real estate would continue to do comparatively well.
I lived in New York during its last real estate crisis and I remember reading of high end real estate properties literally dropping 30% in value overnight. New York could see its real estate markets catch up to the remainder of the country quite rapidly. Remember, as in every other market this cycle, illiquidity plays a major role in proper price discovery. In real estate, this means the possibility exists that a $5 Manhattan loft could be worth $2.5 million a week later. Whether sellers want to acknowledge this fact is irrelevant.
With finance and now manufacturing taking a serious hit in New York, this is adding confirmation to a point I made while New York City real estate values were still rising. That being, before this cycle is over, I expect some of the worst real estate problems to be centered in New York City and places like The Hamptons. We are likely still in the beginning stages of a New York real estate decline versus other parts of the country. This is logical given the epicenter of the U.S. bubble resides on Wall Street. Until Wall Street's bubble started to collapse, real estate would continue to do comparatively well.
I lived in New York during its last real estate crisis and I remember reading of high end real estate properties literally dropping 30% in value overnight. New York could see its real estate markets catch up to the remainder of the country quite rapidly. Remember, as in every other market this cycle, illiquidity plays a major role in proper price discovery. In real estate, this means the possibility exists that a $5 Manhattan loft could be worth $2.5 million a week later. Whether sellers want to acknowledge this fact is irrelevant.
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