Monday, October 27, 2008

More on the plummeting price of homes

The housing crisis has arrived for middle class New York.

The perception that New York largely dodged the housing bust bullet may be true in Manhattan, but in the working-class outer boroughs, house sales are falling faster than the Dow.

A look at housing sales in the city's two biggest boroughs, Brooklyn and Queens, shows sales of one-, two- and three-family homes - the backbone of city housing - fell off a cliff.


City's housing market hammered in fallout from woeful economy

In the crazy runup of housing prices, Richmond Hill's modest wood-frame homes, with their narrow driveways and tidy backyards, rose in value each year.

To some, it seemed like the good times might last forever. Within weeks of hitting the market, houses sold. Buyers bid up prices. By 2005, the market peaked with 949 sales, dropping only slightly in 2006, the year the foreclosure crisis first surfaced.

The first dose of reality came in 2007, when house sales fell from 938 to 665.

Last year came the real kick in the teeth - a near-total collapse to just 348 house sales - a sobering 63.3% drop in just four years.

11 comments:

Anonymous said...

Don't worry bout a thang! Mayor Bloomberg will be working for you a 3rd time to solve all the credit/housing crises - solution? Build and flood Willets Point with 5,000 apartments.

Anonymous said...

That's right!

Mayor Bloomberg will be kicking the middle class of NYC in the teeth for a third term unless those lawsuits that are in the planning stages declare his recent end run around democracy illegal!

"Hizzoner" has also declared it a mortal sin to be poor as he continues his attempt to empty the big apple of his most despised social class!

Long live the wealthy,
but barracks in the far reaches of the outer boroughs will be provided for "them" to serve "our" needs
as footman and handmaidens!

Anonymous said...

The predatory lending schemes that led to this housing mess affects all boroughs. It's a shame isn't it?

By Marion TD Lewis, Esq.
www.fightforeclosure.blogspot.com

CntrySigns said...

I know I'm gonna sound like a broken record but I'll say again... Most of these people had no business buying these homes that they couldn't afford! Blame the lenders for not caring if the people pay or not when they approved the loans, blame the people who made bad decisions.

Anonymous said...

" know I'm gonna sound like a broken record but I'll say again... Most of these people had no business buying these homes that they couldn't afford"

That may be true, but, these houses would have stood empty and that would have made the problems noticable to the public. This way a false sense of security was provided to the public during those times. Now the public will be shell shocked and the working class will soon be homeless.

Anonymous said...

Shouldn't this downturn have a slight beneficial aspect to it for those of us who are neither selling nor buying--which is most of us? Our assessment and our taxes are based on the sales of similar houses in our neighborhood. Or so we are told when we get our assessment.

I expect then that there will be a dip in the assessed "value" and, therefore, in the tax. Or am I stupid?

Chiller said...

Keep your cool Queenies. We'll pull through this.

The nation is experiencing a correction in housing prices. This is what happens when the price of a commodity far exceeds its true value and when cheap, blind-eyed credit gets thrown at any sucker with a mailing address.

Make responsible fiscal choices for yourself and your family and you will all be fine. Playing the blame game will not help your home prices. Staying put and weathering the storm will.

italian girl said...

You are a very wise, chiller.

VP said...

It has to happen. This is the much needed, long overdue "healing" of the overly inflated housing market.

I've said it many times: it's impossible to afford a $600K home on $70K income with an honest 30 yr. 20%-downpayment mortgage. Housing prices in low-income areas (under $50K) like Jamaica have to plummet to $150K-200K so that they become affordable and the low-income population is not lured by "STOP FORECLOSURE" scams and exotic mortgages.

Hint: Look up your zip code in the 2000 census and look for the median housing prices for single-family houses. That's a good estimate of how much prices have to drop. There hasn't been a nationwide increase in income to sustain the exorbitant prices of 2004-2007.

So, face it people: the value of your precious houses will plummet 50-60% eventually! Who in his right mind would pay $500K for a measly 1000 sq ft "ranch" on a 40X100 lot in Fresh Meadows??
Why make such a big drama out of the collapsing housing market? Those who were irresponsible enough to use easy credit and LIE about income and employment on mortgage applications will suck it. Big deal.

After all home equity is not money in the bank, so what's the big deal if it suddenly evaporates?

ew-3 said...

CntrySigns - part of the reason that people who could not afford a house got to buy theirs was that the federal government mandated that a certain percentage of loans made had to be to sub-prime borrowers.

You can thank the people who put this deal into place and kept it going since the Clinto years. You can put Barney Frank at the top of your list to thank.

georgetheatheist said...

And don't forget that Cuomo twerp, Andrew, who as Clinton's Housing Secretary was involved at the get-go of this real estate debacle.