I attended the NYU/NYT VU 2006 panel discussion in New York today and one of the speakers was Ian Schrager, the boutique hotelier, who has immersed himself into condo development. He said something that got a chuckle and I it really hit home with me. He basically inferred that observers of the housing market currently suffer from the analysis paralysis.
This article in Thursday’s Washington Post by Tomoeh Murakami Tse (formerly of New York Newsday) who wrote an article addressing the disparity of housing data: Open-Ended Equations How Stable Is Washington’s Housing Market? It All Depends on How You Do the Math [WP]
Home buyers beware: The Washington region is now one of the most precarious real estate markets in the nation, according to reports by economists, banks and industry analysts.
But wait a minute. Maybe it’s one of the safest, according to reports by other economists, banks and industry analysts.
PMI says DC is in the top 20 of riskiest markets
Credit Suisse “assesses DC as moderate and stable”
Center for Economic and Policy Research (Baker) compares rents and home prices
Economy.com (Zandi) measures using 9 variables
“There’s different ways the market can adjust,” said Zandi, a believer in the soft-landing scenario for housing. Prices could be flat, he said, “and the economy can catch up to it, or the market could fall 5 to 10 percent, trade sideways and let the economy catch up.”
With analysts and economists disagreeing on the current state of the market, it is no wonder there is no consensus on its future, either.
This reminds me of an old economist’s joke that “not only can a group of economists disagree on where the market came from, they can’t agree on where the market is going.” Not much of a joke – seems fairly real world to me.
Tags: New York Observer