The Manhattan property bubble is bursting


#1

Originally published at: https://boingboing.net/2018/04/03/unsafe-deposit-boxes-in-the-sk.html


#2

Yeah last time New York’s real estate value were supposed to fall. Leading to stabilizing or falling rents. Was after the econocalypse. And that didn’t happen. Rents and values continued to go up. They continued to build luxury housing as investment property in an ever expanding number of neighborhoods unabated.

So I won’t exactly be holding my breath


#3

That and the decreased investment from China because of tighter controls on cash leaving the country.


#4

Meanwhile, last week:

WASHINGTON (AP) — The White House is denying that senior adviser Jared Kushner is under investigation by the White House Counsel’s office over possible ethical or criminal violations in connection with more than $500 million in loans made last year to his family real estate company.


#5

And what about that Manhattan property he’s trying to unload? Thanks Dad-in-Law!


#6

No matter how you slice it, Jared is fucked and he was an absolute idiot for buying 666.


#7

This is bad news since after two years of underemployment I recently landed a decent job as a designer at a real estate brokerage.

I only hope I can find a cheap apartment before I’m fired.


#8

Okay, tell me again why I’m supposed to care about uber-wealthy people not getting their aspirational pricing.


#9

The interesting part of this for me is watching Il Douche use this measure mainly to punish all the wealthy New Yorkers who know what kind of businessman he really is and laughed at him, as well as watching him use it to provide populist fan service to his Know-Nothing base.

After all is said and done, though, it’s the usual empty posturing against people who are wealthy enough to ride out most storms. UHNWIs will spend the next few years buying over-priced luxury real estate in stable markets outside the U.S., but the housing bubble for the merely wealthy and affluent will deflate more slowly in desirable American cities where people actually want to live and work.


#10

Um… something something something trickle down economics?


#11

If only house prices would come down we could all live where we wanted to.


#12

The Manhattan property bubble is bursting

It’s too big to fail. HA HA HA!


#13

That deal has been a real beast


#14


#15

So then Russian oligarchs will pick up the slack. That country still has tons of people trying to abscond with their GNP.


#16

Thing is, they’re already investing what they can get away with. Not sure how much slack there is to make up.


#17

Because falling real estate prices tend to trigger all kinds of nasty spirals that primarily hurt the most vulnerable in the community rather than those who were helped on the upswing.


#18

If this translates into a generalized softening of the RE market it way that has knock-on effects in the financial markets (i.e., uptick in foreclosures, bank failures, bond losses, etc.). But so far we’re not seeing much of that.

In 2001, the combined effects of the recession and the WTC attacks did, for a little while, actually suppress re prices in New York, reducing it from extremely unaffordable to merely ridiculously unaffordable.


#19


#20

Because the same investment Bubble exists in major cities (and even some suburban areas) nationwide. And in some other nations as well. And it’s one of the chief drivers in gentrification and exhorbinant rents that are a significant portion of what we keep calling “the housing crisis”. You know that whole 1/3 of Americans 35 or under living with family. Income inequality magnified by disparity in home ownership. And all that.

These investments go bust and the rest of us may just start finding this world a little more livable. Provided another burst bubble doesn’t tank the economy overall. Again.

Aside from the potentially serious economic fall out. And it’s the consequences of this shit that trickles down not the profits. It’s kind of something we should be rooting for.