Matrix Blog

Been traveling quite a bit – back on schedule next week (I know, I know, you’ve heard it before)

For about the past five years, I have been telling, explaining, cajoling, articulating, ranting and lamenting (I am sure there are a few more terms to add to the list) the direction that the appraisal industry has moved towards. Its actually more like 15 years, but the past 5 years became intolerable. The industry has involuntarily taken the “please hit me again” position and has been powerless to do anything about it.

Well, the New York Observer decided to write about the issue in a very direct way in the article New York’s Longest-Running Real-Estate ‘Joke’ which I am grateful for. I hope it expands the level of understanding of the problem.

“It’s a joke, the system is a joke,” Mr. Miller said. “There is very little independent analysis of what collateral is really worth.”

I have spoken with everyone who would listen over the years, and some who would not, about whether the lending industry wants an accurate assessment of the collateral or simply a form filled out for the file. Don’t get me wrong, there are a lot of great appraisers, mortgage brokers and lenders out there, but honestly, they are few and far between.

Why? Because the current lending system is flawed as I and others have discussed in nearly every post on Soapbox and quite a few here on Matrix. Here are the the two choices when ordering an appraisal. If you have a commission riding on the appraisal report outcome, which choice do you make?

• Get an appraisal for a low fee, nearly immediately and always at the value required to do the deal.
  
• Get an appraisal for a fee commensurate with the complexity of the assignment in a reasonable period of time (no impact on the closing date) with a comfort level that the collateral is accurately reflected.

The current actions by the New York State AG’s office is a step in the right direction and I can only hope we don’t end up with simply a law they makes it illegal to pressure an appraiser.

New laws will make the stakes higher to be pressured but it won’t change a thing. (Rinse lather) repeat.
Making appraisal pressure illegal will not change a thing. There needs to be a regulatory environment created where appraisers are insulated from pressure, but still held accountable for accuracy.

Tags: New York Observer

4 Comments

With 4 kids, 3 businesses, the Yankees and a lot of things going on in between, I still wonder why I haven’t been reading as many books as I used to. My wife is a voracious book reader, but over the past few years, I haven’t kept pace.

I took on this self-loathing view point after attending Daniel Gross‘ book launch last night for Pop! Why bubbles are good for the economy. I spoke with him at his book launch party last night as well as met Barry Ritholtz, who, along with Dan, are among the smartest and most acessible writers and interpreters of economics out there.

I read a large portion of Dan’s new book on my train commute home. Really good…enjoyable. When I got home, I decided to take a look at my magazine and newspaper subscription list and I realized how large it has become. To examine my list…

I am not including papers I pick up for my commute home including the NY Post, NY Sun, NY Daily News or Newsday, or count copies of Metro or AM New York for the subway.

I am not includimg the 119 rss feeds coming into my bloglines account, the email blasts I subscribe to, nor the sites like Slate, Salon, CNN/Money, Curbed, TheStreet.com, Inman, WashingtonPost.com, SFGate.com (SF Chronicle), Bankrate.com, PIMCO, Forbes.com, Seeking Alpha and quite a few others I like to check in with every day.

Now there are a few on the list that are simply impossible to read everything or I choose not to (namely the New Yorker and The Economist because they are weekly and chock full of stories although I admit I look at every cartoon in the New Yorker.) I definitely don’t read all of these publications front to back. I included non-real estate subscriptions because, well, you never know.

Its apparent that anyone can get so involved in reading news, it could become a full time job. Where’s Evelyn Wood when I need her?

I feel like a sieve, with a slew of these publications going through my brain and the parts that stick, end up in my blog and in my understanding of the real estate market, the economy, and of course, make intelligent picks for next year’s March Madness tourney.

I suspect I am missing a few but don’t have time to check…too many to things to read. Here are the subscriptions I can think of and these are in no particular order.

new york times
wall street journal
barrons
financial times
new yorker
city journal
new york observer
crains
the economist
new york magazine
new york living
time out new york
the real deal
sports illustrated
portfolio
wired
hemmings muscle car
excellence (porsche)
panorama (porsche)
businessweek
american banker
valuation review
real estate weekly
yankees magazine
2 local weekly newspapers

The quantity has cut into my book reading time, that’s for sure. Its a good thing I have invented more time in the day (no time to explain). Suggestions for additions are welcome (no lesson learned from this exercise).

Hey did you hear about that new magazine that came out the other day….?

UPDATE: Here’s a few I forgot to mention:
rolling stone
haute living
new york home
appraisal today
real estate valuation magazine
appraisal journal

Tags: Dan Gross, Barry Ritholtz, Bankrate.com, Forbes, New York Observer

Comments Off on Book ’em Dano: Real Estate Reading List+

The PDF version of the [1Q 2007 Long Island/Queens Market Overview [Miller Samuel]](https://www.millersamuel.com/reports/) that I write for [Prudential Douglas Elliman [PDE]](http://www.prudentialelliman.com/MainSite/MarketReports/ReportsMenu.aspx) is available for download. We just introduced this study series in 2006.

You can see the methodology that went into the report.

You can also [build your own custom data tables](https://www.millersamuel.com/data) using the aggregate report data (from 2Q 2003 through 1Q 2007). I have created a series of quarterly market charts that may be of interest as well.

_An excerpt_

…Overall price indicators showed weakness this quarter particularly at the higher end of the market. Overall median sales price showed relative stability as compared to the same period last year while average sales price showed a modest decline. Inventory levels are expected to level off as seasonal demand increases the number of sales. Current inventory levels remain below those seen in the second and third quarters of last year. However, the number of sales for the quarter is the lowest seen in three years suggesting a lower intensity of sales activity this spring, even when seasonally adjusted….

Download report: 1Q 2007 Long Island/Queens Market Overview [pdf]

Here’s the media coverage for the study. I think I got most of them. Normally I would have covered this the day of publication last week but if you remember, I was kind of in Seine.

Here’s the recap:

Bloomberg News
The Real Deal
New York Observer
Newsday
Crain’s New York

WPIX CW11
Bloomberg Television – In Focus

Bloomberg Radio
Bloomberg Radio

Tags: New York Observer, Radio

Comments Off on 1Q 2007 Long Island/Queens Market Overview Available For Download

My firm released the 1Q 2007 Manhattan Market Overview that we author for [Prudential Douglas Elliman](http://www.prudentialelliman.com) today. Its pretty much consumed most of my time for the past week and I am glad it is finally out. The “pretty” version should be online by the end of the day.

Note: I am equally thrilled that I won my March Madness pool last night with a Florida win.

The numbers were released and my summary of their interpretation were provided to the media for the coverage today. The actual [data](https://www.millersamuel.com/data) and [charts](https://www.millersamuel.com/charts) will be available later today as well.

A year ago, I began posting the links to the coverage of each report as they are released to see how each media outlet reports the market using the exact same data. I find it to be an interesting process.

This list of articles is presented basically when I found them. I also include some duplicate news feeds because I like to see what regions are interested in the story – I place those near the bottom because of the repetition. I’ll keep adding links through the end of the week.

The Link List

Market Strong for Apartments in Manhattan [NYT] April 3, 2007
Big Apple’s Housing Market Shines [TheStreet.com] April 3, 2007
Manhattan home prices on the rise – again [CNN/Money] April 3, 2007
CITY HIGH RI$E [New York Post] April 3, 2007
Manhattan Apartment Prices Increase at Slower Pace [Bloomberg] April 3, 2007
Wall St dollars help NY buck U.S. housing decline [Reuters] April 3, 2007
Buoyant Manhattan Market Bucks National Housing Trend [New York Sun] April 3, 2007
No bubble in NYC apartment prices [New York Daily News] April 3, 2007
Manhattan Market Report: Sales Soar, Prices Nudge Up [Curbed] April 3, 2007
Residential market in bloom [The Real Deal] April 3, 2007
Manhattan Apartments Keep Selling [Gothamist] April 3, 2007
Manhattan home prices still rising [MSN Money] April 3, 2007
Wall St dollars help NY buck housing decline [Yahoo! News] April 3, 2007
Manhattan’s real estate market stays hot [amNew York] April 3, 2007
Big Apple Bucking National Housing Market Trends [All Headline News] April 3, 2007
Manhattan Residential Market Surges in 2007 [Commercial Property News] April 3, 2007
Quarterly Figures Defy Dour Predictions [New York Observer] April 4, 2007

Radio and TV clips

Manhattan Residential Market [Bloomberg TV] April 3, 2007
Manhattan Residential Market Surges in 2007 [Dow Jones TV] April 3, 2007
Manhattan Residential Market [Bloomberg TV] April 3, 2007
Manhattan Residential Market [WABC-TV] April 3, 2007
Manhattan Residential Market [WNYW-TV Fox 5] April 3, 2007
Manhattan Residential Market [NY 1] April 3, 2007
Manhattan Residential Market [NY 1] April 3, 2007

[Bloomberg Radio] April 4, 2007
[Bloomberg Radio] April 3, 2007

Tags: NY1, New York Observer, Radio

Comments Off on [Media Chain-Links => Post March Madness] 1Q 2007 Manhattan Market Overview

The 4Q 2006 Manhattan Market Overview that my appraisal firm, [Miller Samuel](https://www.millersamuel.com), authors for [Prudential Douglas Elliman](http://www.prudentialelliman.com), was released for publication today. In order to include the entire quarter for the study, I spent the good part of the New Years weekend while away on vacation in a Starbucks crunching and analyzing while drinking too many vanilla skim lattes. Thats why the pretty version of the report [will be available in a few days](https://www.millersamuel.com/reports) rather at the point of release to the media.

The raw numbers were released and my summary of their interpretation were provided to the media for the coverage today. The actual [data](https://www.millersamuel.com/data) and [charts](https://www.millersamuel.com/charts) will be available soon online. I tend focus only on the data collection, verification and analysis until the media publishes the findings.

Each quarter I place links to articles about our market report for a few days after publication for perspective (plus I am obessed with making lists) to make it easy to compare how each media outlet (big and small media, blogs) presents the exact same set of data.

This article list is presented in no particular order, basically when I found them. I also include some duplicate news feeds because I like to see what regions are interested in the story – I place those near the bottom because of the repetition. I’ll keep adding links through the end of the week.

[Home Prices Fall Just a Bit; Brokers See ‘Soft Landing’ [NYT]](http://www.nytimes.com/2007/01/03/nyregion/03housing.html)
[Manhattan real estate cools off [CNN/Money]](http://money.cnn.com/2007/01/02/real_estate/Manhattan_housing_market_drops/index.htm?section=money_latest)
[Real estate still strong [NY Daily News]](http://www.nydailynews.com/business/story/485161p-408471c.html)
[NYC APTS PRICED TO SELL: STUDY [NY Post]](http://www.nypost.com/seven/01032007/business/nyc_apts_priced_to_sell__study_business_braden_keil.htm)
[Apartments up at least 5% in Manhattan [Newsday]](http://www.newsday.com/business/ny-bzapar5037785jan03,0,4471241.story?coll=ny-business-print)
[Manhattan Apartment Prices Rise 3.2%, Sidestep U.S. Declines [Bloomberg]](http://www.bloomberg.com/apps/news?pid=20601087&sid=al26rXGuKKNY&refer=home)
[Reports Contradict Predictions of Apartment Market Slump [NY Sun]](http://www.nysun.com/pf.php?id=45996)
[Manhattan apartment downturn short-lived: report [Reuters]](http://today.reuters.com/news/articlenews.aspx?type=businessNews&storyID=2007-01-03T065344Z_01_N02353836_RTRUKOC_0_US-APARTMENTS-NEW-YORK.xml&WTmodLoc=NewsHome-C3-businessNews-2)
[Brokerages Turn in Homework for the Semester [Curbed]](http://www.curbed.com/archives/2007/01/03/brokerages_turn_in_homework_for_the_semester.php#more)
[Brokerages: Market is stable [The Real Deal]](http://www.therealdeal.net/tools/print_article.php?article_num=/breaking_news/2007/01/03/1167844685.php&article_name=Brokerages%3A+Market+is+stable)
[A Look Back in 2007! Manhattan Is Still an Islan [NYO-The Lab]](http://nyobserver.com/20070108/20070108_Tom_Acitelli_finance_thelab.asp)
[Reports show real estate slowdown [AM New York]](http://www.amny.com/news/local/newyork/am-realestate01013,0,5101712.story)
[Average Manhattan apt: $1.2M [Metro]](http://ny.metro.us/metro/local/article/Average_Manhattan_apt_12M/6389.html)
[Home is where B’klyn bucks are, reports show [NY Daily News]](http://www.nydailynews.com/business/story/485159p-408456c.html)
[Market for Manhattan Apts. Strong [Chicago Tribune]](http://www.chicagotribune.com/business/sns-ap-manhattan-apartments,0,6411490.story?coll=chi-business-hed)
[Market for Manhattan apartments remained strong in 2006 [Boston Herald]](http://business.bostonherald.com/realestateNews/view.bg?articleid=175094)
[Real Estate Bubble Slowly Deflating, Not Bursting [Gothamist]](http://www.gothamist.com/archives/2007/01/03/real_estate_bub_1.php)
[Market for Manhattan Apts. Strong [Tuscaloosa News]](http://www.tuscaloosanews.com/apps/pbcs.dll/article?AID=/20070103/APA/701030519)
[Manhattan apartments go for an average $1.14-million (U.S.) [Globe and Mail, Canada]](http://www.theglobeandmail.com/servlet/story/RTGAM.20070103.wmanhattan0103/BNStory/Business/home)
[Market for Manhattan apartments remained strong in 2006 despite national dip, analysts say [San Diego Union Tribune]](http://www.signonsandiego.com/news/business/20070103-0250-manhattanapartments.html)
[Market for Manhattan Apts. Strong [Sun-Sentinel]](http://www.sun-sentinel.com/business/local/sns-ap-manhattan-apartments,0,2093084.story?coll=sfla-business-headlines)
[Manhattan apartment downturn short-lived: report [WaPo]](http://www.washingtonpost.com/wp-dyn/content/article/2007/01/03/AR2007010300076.html)
[Manhattan apartment downturn short-lived: report [MSN Money]](http://news.moneycentral.msn.com/provider/providerarticle.aspx?feed=OBR&Date=20070103&ID=6310131)
[Manhattan apartment downturn short-lived: report [KPLC-TV/Lake Charles, LA]](http://www.kplctv.com/Global/story.asp?S=5883509&nav=0nqx)
[Manhattan apartment downturn short-lived: report [Reuters Canada]](http://ca.today.reuters.com/news/newsArticle.aspx?type=businessNews&storyID=2007-01-03T065404Z_01_N02353836_RTRIDST_0_BUSINESS-APARTMENTS-NEW-YORK-COL.XML)
[Market for Manhattan apartments remained strong in 2006 despite national dip, analysts say [IHT]](http://www.iht.com/articles/ap/2007/01/03/business/NA_FIN_US_Manhattan_Apartments.php)
[Mean Manhattan apt. price up to $1.1M [ABC]](http://abclocal.go.com/wabc/story?section=business_week&id=4902826)
[Healthy Year for Manhattan Real Estate Market [RISMedia]](http://www.rismedia.com/wp/2007-01-03/healthy-year-for-manhattan-real-estate-market/)
[NYC Apartment Market Prices Up with Inventory Growth Dropping Sharply [Earthtimes]](http://www.earthtimes.org/articles/show/news_press_release,39849.shtml)
[NYC Apartment Market Prices Up with Inventory Growth Dropping Sharply [Yahoo Business]](http://biz.yahoo.com/prnews/070103/nyw105.html?.v=81)
[Reuters Canada Business Summary [Globe and Mail]](http://www.globeinvestor.com/servlet/story/ROC.20070103.2007-01-03T160612Z_01_N03404162_RTRIDST_0_BUSINESS-SUMMARY/GIStory/)
[Manhattan real estate prices still rising in Q4 [Inman – Subsc]](http://www.inman.com/printer.aspx?ID=60870)
[Manhattan real estate market remains strong [Courier News (NJ)]](http://www.c-n.com/apps/pbcs.dll/article?AID=/20070103/FRONT01/70103008)

Radio and TV clips

[January 8, 2007] [The Real Deal](http://www.therealdeal.net/directv/video.php)
[January 7, 2007] [WABC-TV](https://www.millersamuel.com/press/view.php?V=1168307231kbBEe)
[January 3, 2007] [Bloomberg TV](https://www.millersamuel.com/press/view.php?V=1167880431qujzH)
[January 3, 2007] [WABC-TV](http://abclocal.go.com/wabc/story?section=business_week&id=4902826)
[January 3, 2007] [WABC-TV](https://www.millersamuel.com/press/view.php?V=1168307452vcbrt)
[January 3, 2007] [WABC-TV](https://www.millersamuel.com/press/view.php?V=1168308209JANDe)
[January 3, 2007] [WNBC-TV](https://www.millersamuel.com/press/view.php?V=1168308390NBqFe)
[January 3, 2007] [Bloomberg TV](https://www.millersamuel.com/press/view.php?V=1168309192JsokM)
[January 3, 2007] [Bloomberg TV](https://www.millersamuel.com/press/view.php?V=1168309483edgkl)
[January 3, 2007] [Bloomberg TV](https://www.millersamuel.com/press/view.php?V=1168309595WpPsy)

[January 3, 2007] [Bloomberg Radio](https://www.millersamuel.com/press/view.php?V=1168310345woRLC)
[January 3, 2007] [Bloomberg Radio](https://www.millersamuel.com/press/view.php?V=1168311084mbOMv)
[January 3, 2007] [Bloomberg Radio](https://www.millersamuel.com/press/view.php?V=1168311365hRHhl)

Tags: New York Observer, Canadian Housing Market, Radio

2 Comments

As Jason Kidd, upon being drafted to the Dallas Mavericks pro basketball team declared:

We’re going to turn this team around
360 degrees.

About 5 years ago, John Marchant of Business360 approached me to provide information for his forecast of the Manhattan real estate market. The forecast would use information generated during the preparation of our quarterly market reports. He impressed me with his insight and I was even more impressed with his approach to the research as well as his candor.

Business360 is a high-quality information and business services company, underpinned by a unique and flexible resourcing model and large global team of specialists and generalists. This particular report and related forecasts have been covered in The New York Times, Crain’s, New York Observer and The Financial Times.

Here’s their track record:

But their forecast remains a contrarian viewpoint:

Prices are falling in other U.S. markets and the situation in Manhattan is increasingly unclear. Confidence and psychology are important factors in the market and today Manhattan’s market looks to be at a balance point. Supply is up strongly and buyers are holding back, making for a stalemate. Prices have run up very strongly over the last seven years or so, greatly outstripping personal income gains, and many believe prices should pull back to bring them in line. However, a review of prices over a 25-year period, or against the last peak in 1987, suggests that prices have room to rise.

[The report is available to download for a modest fee ($99)](http://www.business360.com/?p=realestate).

However, since John is a better negotiator than I am, I get nothing financial out of the deal, other than a copy of the report and a free round when we go out to bend an elbow.

Tags: New York Observer

3 Comments

The 3Q 2006 Manhattan Market Overview that my appraisal firm, [Miller Samuel](https://www.millersamuel.com), authors for [Prudential Douglas Elliman](http://www.prudentialelliman.com), was released for publication today. The raw numbers were released and a summary of their interpretation were provided to the media. The pretty report will be available for download later this week or early next week. I wait until the end of the quarter before I start working on it so there is not enough time to get it together before publication of the results. This quarter ended last Saturday so it made for a long weekend.

The actual [data](https://www.millersamuel.com/data) and [charts](https://www.millersamuel.com/charts) will be available soon. The [actual report pdf will be available next week](https://www.millersamuel.com/reports).

For perspective, every quarter I place links to articles about the report for a few days after publication to make it easy to compare how each media outlet (big and small media, blogs) presents the exact same set of data.

This article list is presented in no particular order, basically when I found them. I include some duplicate news feeds because I like to see what regions are interested in the story.

[Manhattan real estate finally starts to cool [CNN/Money]](http://money.cnn.com/2006/10/03/real_estate/manhattan_prices/)
[Buying in Manhattan? Apartment Prices Steady [New York Times]](http://www.nytimes.com/2006/10/04/nyregion/04estate.html?r=1&ref=nyregion&oref=slogin)
[Manhattan apartment prices slip in latest quarter [New York Daily News]](http://www.nydailynews.com/business/story/458049p-385473c.html)
[Manhattan apartments selling slower [Newsday]](http://www.newsday.com/business/ny-bzside4917396oct04,0,6694883.story?coll=ny-business-print)
[Manhattan apartment market seen in soft landing [Reuters]](http://today.reuters.com/news/articleinvesting.aspx?type=bondsNews&storyID=2006-10-04T035829Z_01_N03332584_RTRIDST_0_PROPERTY-MANHATTAN.XML)
Manhattan Co-Op Apartment Prices Dip 16% as Buyers Favor Condos [Bloomberg (no link yet)]
[Manhattan Housing Stays Stable [TheStreet.com]](http://www.thestreet.com/_googlen/newsanalysis/realestate/10312833.html?cm_ven=GOOGLEN&cm_cat=FREE&cm_ite=NA)
[Manhattan apartment prices leap despite sales drop [Reuters]](http://today.reuters.com/news/newsArticle.aspx?type=businessNews&storyID=2006-07-06T043417Z_01_N05280414_RTRUKOC_0_US-PROPERTY-NEWYORK.xml&archived=False)
[Jonathan Miller On Summer ’06: New York Realty Isn’t So Bad [NYO The Real Estate]](http://therealestate.observer.com/2006/10/jonathan-miller-on-summer-06-new-york-realty-isnt-so-bad.html)
[Prices down, sales up in Manhattan housing market; co-op prices slump [The Real Deal]](http://www.therealdeal.net/breaking_news/2006/10/03/1159908890.php)
[As Dow Hits Record High, Homes Falter [NY Sun]](http://www.nysun.com/article/40855)
[N.Y. CRA$H PADS [NY Post]](http://www.nypost.com/seven/10042006/realestate/n_y_crah_pads_realestate_braden_keil.htm)
[Manhattan real estate market slows down [Inman]](http://www.inman.com/inmannews.aspx?ID=57457)
[DownMarket Reports: Choose Your Own Adventure! [Curbed]](http://www.curbed.com/archives/2006/10/04/downmarket_reports_choose_your_own_adventure.php#more)
[Sector Snap: Manhattan Apartment REITs [AP]](http://www.chron.com/disp/story.mpl/ap/fn/4235495.html) [Highlights from the Prudential Douglas Elliman Third Quarter Overview [True Gotham]](http://www.truegotham.com/archives/market-insight-highlights-from-the-prudential-douglas-elliman-third-quarter-overview.html)
[Manhattan residential real estate market cools [Valuation Review]](http://www.valuationreview.com/ME2/Audiences/dirmod.asp?sid=270E8EBA5AF64172B917EBD588EDB85A&nm=Daily+News&type=news&mod=News&mid=5F249E552B2C49509BC41751816632F3&AudID=F0F48C5C19CB47B3A675FD6074A3CB8A&tier=3&nid=0853B418C9114E35A4BC32644DA38B8B)

Here are a handful of tv spots as well.

[[WABC]](https://www.millersamuel.com/press/view.php?V=1160274846fKCHR)

[[Bloomberg TV]](https://www.millersamuel.com/press/view.php?V=1160186075fWQvH)

[[WCBS]](https://www.millersamuel.com/press/view.php?V=1160187666QIxbS)

[[WCBS]](https://www.millersamuel.com/press/view.php?V=1160187547ouxHm)

Tags: New York Observer

6 Comments

Every year I get a little jittery around this time as the anniversary of the events of 9/11 approach. Memories get re-hashed and reviewed, followed by sadness and disbelief, but then followed by amazement at the perseverance.

For me personally, the thought that some nut will do something stupid to get attention on each subsequent anniversary date is always a worry. Last year on the 4th anniversary, I remember thinking that the 5th anniversary (this year) was the biggie. And sure enough, a major plot was discovered and foiled.

I generally don’t read about 9/11 anymore. Its not that I want to forget or am avoiding it, but rather I have been filled to the brim with stories over the past 5 years about the events and directly from people who experienced a loss.

However, New York Magazine does a really good job in this week’s issue, asking the question: [What if 9/11 didn’t happen?](http://newyorkmetro.com/news/features/19147/) where they ask different people for their take. Its a refreshing counterhistory piece.

Each year, I have been asked countless times by various media to provide stats on the performance of the housing market (which admittedly grated me) and every year the market seemed to show resiliancy and strength (coupled with low mortgage payments).

However, for the first time, [I was asked to discuss the real estate market as if 9/11 never happened](http://newyorkmetro.com/news/features/19147/index3.html), which sort of threw me for a loop since I had never thought about 9/11 in this context before. It was incredibly hard to filter out all the emotion and tragedy and simply answer their question.

Basically, I attributed the latest housing boom to the sharp drop in mortgage rates shortly after 9/11. And I don’t just mean New York. Of course, this is not to imply that the phenomenon was a good thing in any way shape or form. I’d trade the housing boom to turn back the clock. But of course, there is no going back and the world keeps on turning.

On a far less materialistic level, whole concept of what was, and what will never be can be pretty sobering.

Phew, this is kind of heavy. Its time for a vacation.

UPDATE: [Jonathan Miller On 9/11: It’s the Housing Boom, Stupid [NYO]](http://therealestate.observer.com/2006/08/jonathan-miller-on-911-its-the-housing-boom-stupid.html)

Tags: New York Observer

3 Comments

The 2Q 2006 Manhattan Market Overview that my appraisal firm, [Miller Samuel](https://www.millersamuel.com), prepares for [Prudential Douglas Elliman](http://www.prudentialelliman.com), was released today. Each quarter I place links throughout the day of publication to make it easy to compare how each media outlet (big and small media, blogs) presents the exact same set of data.

Even more interesting to me is how the other real estate brokerage companies who write alternative reports, frame their comments in the articles. While I have not had access to their specific results, I understand that some of the statistics such as average sales price, differed from the results in our report. Some of the reporters that cover the real estate market in New York have expressed frustration at trying to discern what actually happened this quarter.

To view the actual [data](https://www.millersamuel.com/data) and [charts](https://www.millersamuel.com/charts) (going live by noon Friday 7-7-07). The [actual report pdf will be available next week](https://www.millersamuel.com/reports).

This list is in no particular order and were generally presented when I found them. I included some of the duplicate news feeds because I found it interesting who picked up the story. I will keep adding to the list through the remainder of the week.

[Little Shift in Prices of Manhattan Apartments [NYT]](http://www.nytimes.com/2006/07/06/nyregion/06real.html?_r=1&adxnnl=1&oref=slogin&adxnnlx=1152176161-iZAH5p72OAppi6NxdAtzWg)
[Manhattan Has Most Apartments for Sale Since 1994, Report Says [Bloomberg]](http://www.bloomberg.com/apps/news?pid=20601103&sid=aU4XFcYKAYTE&refer=us)
[Mixed messages on Manhattan home prices [CNN/Money]](http://money.cnn.com/2006/07/06/real_estate/manhattan_prices_iffy/index.htm)
[Manhattan apt. price hits record [NY Daily News]](http://www.nydailynews.com/business/story/432702p-364622c.html)
[Disparities in Manhattan apartment prices show a market that is neither booming nor busting [NY Newsday]](http://www.newsday.com/business/ny-bzreal064807760jul06,0,5664699.story?coll=ny-business-print)
[Condo Expectations May Be Rethought As Prices Plunge [NY Sun]](http://www.nysun.com/article/35479?page_no=1)
[Manhattan apartment prices leap despite sales drop [Reuters]](http://today.reuters.com/news/newsArticle.aspx?type=businessNews&storyID=2006-07-06T043417Z_01_N05280414_RTRUKOC_0_US-PROPERTY-NEWYORK.xml&archived=False)
[Manhattan real estate inventory grows [Inman]](http://www.inman.com/inmannews.aspx?ID=54094)
[NYC Housing Prices Keep Climbing [TheStreet.com]](http://www.thestreet.com/_googlen/markets/realestate/10295183.html?cm_ven=GOOGLEN&cm_cat=FREE&cm_ite=NA)
[Manhattan condos again outsell co-ops [The Real Deal]](http://www.therealdeal.net/breaking_news/2006/07/05/1152132992.php)
[Sales drop, prices rise in Manhattan market [The Real Deal]](http://www.therealdeal.net/breaking_news/2006/07/05/1152132992.php)
[2nd Quarter 2006: “The Boom is Done” [The Real Estate]](http://therealestate.observer.com/2006/07/2nd-quarter-2006-the-boom-is-done.html)
[Manhattan housing prices up [USAToday (Miller Samuel)]](https://www.millersamuel.com/press/view.php?V=1152198047iISSF)
[Brokerages Submit Reports, Hope to Avoid Summer School [Curbed]](http://www.curbed.com/archives/2006/07/06/brokerages_submit_reports_hope_to_avoid_summer_school.php)
[Manhattan Apartment Price Hits Record Highs [All Headline News]](http://www.allheadlinenews.com/articles/7004134834)
[Investing: Rising rates depress N.Y. apartment sales [IHT]](http://www.iht.com/articles/2006/07/06/bloomberg/bxinvest.php)

_Duplicate News Feeds_
[Sales mellow in Manhattan [Houston Chronicle]](http://www.chron.com/disp/story.mpl/business/4032692.html)
[Manhattan apartment prices leap despite sales drop [Yahoo News]](http://news.yahoo.com/s/nm/20060706/us_nm/property_newyork_dc_1)
[Manhattan has most apartments for sale since 1994 [The Journal News (Westchester, NY)]](http://www.thejournalnews.com/apps/pbcs.dll/article?AID=/20060707/BUSINESS01/607070354/1066)
[Manhattan apartment prices leap despite sales drop [Washington Post]](http://www.washingtonpost.com/wp-dyn/content/article/2006/07/06/AR2006070600030.html)
[Sales of Manhattan apartments falling [Sun-Sentinel]](http://www.sun-sentinel.com/business/local/sfl-zmanhattan07jul07,0,5055822.story?coll=sfla-business-headlines)
[Apartments On The Market In Manhattan Hit 12-Year High [Tampa Tribune]](http://www.tbo.com/news/money/MGBCJ39UBPE.html)
[Manhattan apartment prices leap despite sales drop [MSN Money]](http://news.moneycentral.msn.com/provider/providerarticle.asp?feed=OBR&Date=20060706&ID=5845905)
[Manhattan apartment prices leap despite sales drop [7KPLC (Lake Charles, Louisiana)]](http://www.kplctv.com/Global/story.asp?S=5117604&nav=0nqx)
[Manhattan apartment prices leap despite sales drop [Wave3 (Louisville, Kentucky)]](http://www.wave3.com/Global/story.asp?S=5117604&nav=0RZF)

Here are a handful of radio and tv spots as well – more to come.

[[Bloomberg TV]](https://www.millersamuel.com/press/view.php?V=1152217584nZZzm)

[[WPIX WB11]](https://www.millersamuel.com/press/view.php?V=1152205902HyQln)

[Morning Call [Bloomberg TV]](https://www.millersamuel.com/press/view.php?V=1152206175xZucz)

[Bloomberg Morning Markets [Bloomberg TV]](https://www.millersamuel.com/press/view.php?V=1152206399USXHi)

[Squawk Box [CNBC]](https://www.millersamuel.com/press/view.php?V=1152206542EnnNB)

[News at Ten [WB11]](https://www.millersamuel.com/press/view.php?V=1152400841fiAje)

[News at 5 [Fox 5]](https://www.millersamuel.com/press/view.php?V=1152401325YefhA)

[WSJ Report [WCBS Radio]](https://www.millersamuel.com/press/view.php?V=1152206747BhrMI)
[NPR poor fidelity – better clip coming [WNYC]](https://www.millersamuel.com/press/view.php?V=1152206894TnsIA)

Tags: FHA, CNBC, New York Observer, Radio

4 Comments

Susan Kelo: New London, CT

The fallout from the seminal Supreme Court [eminent domain](http://en.wikipedia.org/wiki/Eminent_domain) ruling [KELO et al. v. CITY OF NEW LONDON et al.](http://caselaw.lp.findlaw.com/scripts/getcase.pl?court=US&vol=000&invol=04-108) has been widespread as [state legislatures have sought strengthen state’s rights](http://matrix.millersamuel.com/?p=419) in order to prevent the takings of private property for public development.

Its been a year since the eminent domain ruling and the City of New London, Connecticut has negotiated with the two remaining [homeowners to vacate their private homes](http://apnews.myway.com/article/20060624/D8IEDVP00.html) in order to make way for private development.

The ruling touched a nerve for the simple reason that its one of the basic principles of US citizenship.

Government ability to seize private property for public good has been relegated to things like roads, schools and government buildings. Economic reasons have now reached the forefront of the concept. [This is not a new concept](http://www.cbsnews.com/stories/2003/09/26/60minutes/main575343.shtml).

For them to come in and tell me how much my property’s worth and for me to get out because they’re bringing in somebody else when I own the land is unfounded to me.

Kelo brought clarity to the concept however and touched a nerve. This could be of particular concern on the east coast where land is much more scarce and [big box retailers, who try to stay below the public relations radar, may seek to take advantage](http://money.cnn.com/2005/06/23/news/fortune500/retail_eminentdomain/).

The federal government has now taken action [to prevent its own agencies from seizing private property [WSJ]](http://online.wsj.com/article/SB115111683138389767-search.html?KEYWORDS=housing&%20OLLECTION=wsjie/6month) except for public projects reflecting conservatives concerns over the erosion of the Constitution’s Fifth Amendment. They have argued such takings are an unjustified governmental abuse of individual rights. Liberals see the new power as a powerful tool in urban renewal to revitalize cities. [The executive order](http://www.whitehouse.gov/news/releases/2006/06/20060623-10.html) is an attempt to offset some of the momentum of the Supreme Court ruling.

The battle over the issue will be waged for years to come. The New York Times [posted an editorial for the responsble use of Eminent Domain](http://www.nytimes.com/2006/06/26/opinion/26mon3.html?r=2&oref=slogin&oref=slogin) and the good that it can do. _The Real Estate blog quipped that the New York Times is calling for responsible use of eminent domain while it was imposed on [the development of their upcoming new headquarters on 41st Street](http://therealestate.observer.com/2006/06/bush-v-kelo-v-new-york-times.html).

In 1998, pharmaceutical giant Pfizer built a plant next to Fort Trumbull and the City determined that someone else could make better use of the land than the Fort Trumbull residents. [The City handed over its power of eminent domain](http://www.ij.org/private_property/connecticut/index.html)—the ability to take private property for public use—to the New London Development Corporation (NLDC), a private body, to take the entire neighborhood for private development. As the Fort Trumbull neighbors found out, when private entities wield government’s awesome power of eminent domain and can justify taking property with the nebulous claim of “economic development,” all homeowners are in trouble.

I am all for urban revitalization, new urbanism, etc., but this ruling goes beyond where I am comfortable. Everyone can call it as they see it from a distance, thats easy. Imagine living in your home for 40 years in an area where there is no urban blight, where houses are kept up, and the community is cohesive? [What is the just compensation in this case?](http://en.wikipedia.org/wiki/Fifth_Amendment_to_the_United_States_Constitution#Eminent_domain) That is exactly what happened in New London, CT.

I suspect that the issue of just compensation, is probably more than market value can support.

Tags: London, New York Observer

Comments Off on Eminent = Imminent

[Economists have been trying to quantify happiness](Truck and Barter](http://truckandbarter.com/mt/archives/2006/06/the_hedonic_tre.html) or well-being in numerical terms for years.

The housing [wealth effect](http://matrix.millersamuel.com/?p=62) has been one of the more important linkages between the housing market and consumer patterns in the current economy.

Can we infer that the more propserous a household is, the happier it is? (I can imagine a huge swath of the population shaking their heads “NO!” to that comment.) I do a lot of real estate consulting in divorce cases and I KNOW this to be a false statement.

So lets back up. Rather than prosperity, lets say we associate [well-being](http://en.wikipedia.org/wiki/Well-being) on national basis with GDP and see if that ties into housing.

[Gross Domestic Product (GDP)](http://dictionary.reference.com/browse/gdp) deals with output and the wealth effect deals with consumption.

The OECD report showed there is a [correlation between GDP and leisure time [OECD]](http://www.oecdobserver.org/news/fullstory.php/aid/1853/Wealthy_fun.html). They looked at a large array of countries and interviewed residents about their happiness and charted it against their nation’s GDP.

Work may drive growth, but for most people, more free time contributes to well-being, as long as it is not accompanied by lower income. Still, one often-heard remark about the gap in economic performance between OECD countries is that US workers may earn more money but they work longer hours, whereas Europeans prefer more leisure to more work, or indeed, more money, and so are better off.

[To more accurately measure happiness using GDP, the OECD report [Yale Economic Review]](http://www.yaleeconomicreview.com/issues/summer2006/gdh.php) compares multiple alternative measures of happiness:

• “national accounts indicators,” such as net national income, more accurately reflect economic resources because they correct for transfer payments and other market factors.

• “extended monetary measures,” integrates non-market factors such as leisure time into traditional monetary statistics.

• neglected social influences which affect happiness and yet cannot be easily reflected in economic statistics. They separate social indicators into four rough categories: self-sufficiency, equity, health, and social cohesion, and identify proxies such as average years of schooling and infant mortality to help quantify the indicators and find that most correlate well with output data.

The authors conclude in their study that GDP, while flawed can be a pretty good indicator of happiness on a country-wide basis.

At the same time, [GDP can be correlated with new home sales](http://www.dallasnews.com/sharedcontent/dws/bus/columnists/ddimartino/stories/DN-dimartino_10bus.ART.State.Edition1.90d5e2f.html). I [correlated GDP with the New York housing market](http://www.curbed.com/archives/2005/09/28/three_cents_worth_gdp_as_a_pdg_real_estate_indicator.php) to the same effect.

Therefore, since housing can correlate with GDP and GDP correlates to well-being (happiness), can we infer that (how we feel about our) housing, affects our happiness?

Sure its a stretch, just like an adjustable rate mortgage thats about to reset.

Tags: Three Cents Worth, Europe, New York Observer, 3CW

1 Comment

I attended the NYU/NYT VU 2006 panel discussion in New York today and one of the speakers was [Ian Schrager, the boutique hotelier](http://www.ianschragercompany.com/), 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]](http://www.washingtonpost.com/wp-dyn/content/article/2006/04/19/AR2006041902320.html)

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.

[Lies, Damn Lies, And Government Statistics: Part I [Matrix]](http://matrix.millersamuel.com/?p=65)
[Lies, Damn Lies, And Government Statistics: Part II [Matrix]](http://matrix.millersamuel.com/?p=68)

Tags: New York Observer

Comments Off on Lies, Damn Lies, And Statistics Part III: Nobody Agrees On How To Do The Math