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BubbleWatch™: Enfin, La Deluge?

Hey, BubbleWatch made Drudge! In red, no less! Wait... that can't be good.

It's not. Four market reports released yesterday show a sliding NYC housing market—enough that the NYT splashes its front page with the carnage this morning (nationwide carnage, no less). The big news in our back yard:

1) Average Manhattan sales price falls 12.7% in third quarter from second quarter ($1.32 million in the second quarter to $1.15 million in the third quarter), according to Miller Samuel's Prudential Douglas Elliman market report.
2) Selling time jumps 30.4% over the same period last year, with For Sale signs hanging for an average of 133 days, up from 108. (Open house cold front, indeed.)
3) Apartment inventory up 13% from 2004 to 2005. "This is sometimes a sign of a cooling market," a NYT infographic dryly notes.
4) Luxury market really takes a beating, with prices down 26% ($5.2 million average to $3.8 million average) in last three months. Only four sales above $10 million.
5) Record sales of entry-level apartments pushing price averages downward.

Brokers sound notes of relative optimism, of course, noting summer traditionally (read: from 1958 to 1972) was a slow time for the housing market. Where from here? Let's not forget prices this summer were still a solid 10% above those last summer. If this is the downdraft, let's break out the party hats.
· Slowing is Seen in Housing Prices in Hot Markets [NYTimes]
· Real Estate in Bubble Trouble [NYPost]