Brown Harris vs Brown Harris / 25% drop in coop value at the top already??
too weird to avoid
I just saw this story from an ABC News blog, plugging a 20/20 interview tonight (hat tip to Curbed.com) by one of THE top top-end agents in Manhattan. Yes, agents (and Manhattan real estate firm management) say uninformed stuff in the media all the time, but this one is a pretty wild statement about the current market, which generated an interesting rejoinder from the agent’s boss (including saying it is "completely speculative" and "factually incorrect").
First, the agent apparently says (no quote in the article) that "Manhattan’s finest co-op apartments may have already lost a fourth of their value as a result of the financial crisis" (my emphasis in bold), which may get worse in as little as a month (this one with a direct quote): "An owner of a five-million dollar Park Avenue apartment, only an average residence by investment banker standards, ‘may be lucky to achieve $3.5 million’ a month from now, said [the agent]". (That would be a 30% loss, at least.)
The blog post focuses on how many investment bankers are getting creamed because their (employer stock?) portfolios have shrunk, and on how difficult it will be for these (former) ‘Masters of the Universe’ to buy $40mm coops, but I think the spat between agent and firm is most interesting. In addition to the comments quoted above, the firm’s president is quoted as saying "While it is clear that there will be an effect, it would be irresponsible to provide a market forecast and we remain confident in the fundamental strength and resiliency of our market over time." (Was that a market forecast??)
As for me, the financial news has been running so hard and so fast that I have not been able to cobble together a cogent analysis about the Manhattan real estate market. So I will just leave this intra-firm debate where it is for now.
© Sandy Mattingly 2008