Given the conflicting signals about the direction of the Manhattan residential market, it's tough to gauge whether buyers or sellers have the upper hand these days. Comes an email from an informed Curbed reader in response to our Tuesday BubbleWatch? post to make the case why potential buyers may want to wait on the sidelines for now:
I love your site and have been reading for a long time. I am a long-suffering apartment hunter (have probably seen 250+ units over 24 months) and have the following observations:The case for waiting on the sidelines?including the observation "No one (as far as I can tell) is making the claim that NYC real estate will continue to outperform alternative forms of investment"?continues after the jump.
Sellers still undoubtedly have the upper hand, as demand still outstrips supply by a wide margin. I think this will get worse before it gets better, with Wall Street end-of-year bonuses expected to be up this year. That said, I am heartened by the following four factors that I think will spell intermediate-term relief for buyers.
Our correspondent continues:
1) Majority of mortgages over past two years have been 3-, 5- or 7-year ARMs which will convert to floating at some point. Relatively new products like reverse mortgages and interest only mortgages have even greater rate exposure.
2) 421A tax abatements