Daily Archives: January 8, 2009
A New Year’s CIA strike in northern Pakistan killed two top al-Qaeda terrorists long sought by the United States, including the man believed to be behind September’s deadly suicide bombing at a Marriott hotel in the Pakistani capital, U.S. counterterrorism officials told The Washingon Post today.
Please, sir, may we have some more?
WSJ: Funds of funds being pinched as investors realize they’ve been duped. “Funds of funds work well when the model is working”, says one genius. “Right now, the model is broken.” Heck, send me a fee of $10,000 and I’ll give you investment advice. I guarantee that you’ll earn a nice profit. Until you don’t.
So corporate bean counters are under pressure from their PR departments to dump the private jets. But Chairman Preposterous loves his jet and is going to be some pissed at the moron who deprives him of it. What to do, what to do? Simple: put the thing up for sale at a price that ensures no one will buy it. You and the company look good to the public and your shareholders and the Chairman keeps flying – a win-win solution!
Many Greenwich homeowners seem to have already figured this strategy out and have adopted it for use on their residences. And that’s great, so long as they want to keep owning it.
Forbes: Real estate resurrection begins.
J.P. Morgan: It will fluctuate
Another 58% decline before reaching pre-boom levels. It’s all about income, as Retired IB’r points out in a comment below. My working theory: as Manhattan real estate goes, so goes Greenwich. Al is not lost however – Greenwich, unlike NYC, has already seen a fairly large decline, at least for houses that have actually sold this fall. Owners who have refused to believe their eyes may have to take the full whack – others may get away with just another 20-30% shaving. And doesn’t that just warm you to your toes!
My old paper, Greenwich Post, has a good article today written by Sara Poirier on what’s happening in our local real estate market. Once you get past the silly and misleading headline (Market Resurgent!) you’ll see that Poirier interviewed two knowledgeable people and got intelligent quotes from both of them. With the exception of some “I’m a professional realtor so I have to sound optimistic here” lines, the two agents present a cautious view of what may happen this year. One quibble is Poirier’s invention of the word “influxing” – or at least, I don’t think that’s a word.
The Post hasn’t figured out permalinks yet so there’s no way to link to the article. So here it is:
|Thursday, January 08, 2009|
|Last year, 2008, was an emotional roller coaster for Americans, many of whom rang in the new year with lighter wallets and a grim outlook on 2009’s economic future.Real estate experts say even though it’s “just like somebody slammed the door” on the Greenwich market this fall when the economy took a nosedive, the new year will usher in a new wave of interest and consumer confidence sure to spark a fire in town.“I’m really a firm believer that people can only wait so long before they buy a house,” said Nancy Healy, partner at Shore and Country Properties in Riverside and president of the Greenwich Multiple Listing Service (GMLS).Ms. Healy said there is “pent-up demand” for housing in Greenwich and “people want to get on with their lives.”
According to John W.M. Cooke, a licensed broker with Prudential Connecticut Realty, single-family home sales in Greenwich went from 44 in January 2008 to 11 in November, taking the biggest monthly hit in September, when 26 houses were sold compared to 56 in August. That happened while inventory seesawed from 428 homes on the market in January to 623 in June and then 588 as of Dec. 1, according to GMLS statistics.
By the end of the year, said Eric Bjork, vice president of Prudential Connecticut Realty in Greenwich and Old Greenwich, inventory in town was up 26% from 2007, with 536 single-family homes on the market Dec. 31 compared to 426 the previous year. That means the market’s good for buyers and more competitive for sellers, he added.
Mr. Bjork’s advice in today’s market: If you see a home you absolutely love, buy it.
Mr. Bjork told the Post he’s seeing more first-time homebuyers walk through his firm’s doors. A lower median single-family home price — at about $1.85 million (down by about 8% to 12%), and a 5.75% jumbo mortgage rate for 20% down — is allowing those buyers to put less down than when the median price was $2.1 million, and keep monthly payments lower than they would have been had the house been more money.
Ms. Healy said with President Barack Obama taking the lead later this month, she hopes the country will move in “a more positive way” and have the confidence and security she said has not been had in a while.
“People are ready,” she said about potential buyers. “There are some fabulous buys out there.”
She added, “You can’t live in the stock market. You can live in what I consider pretty good value right now.”
Mr. Bjork and Ms. Healy agreed that when it comes to pricing, it’s hard to tell how homes in Greenwich will go.
“Greenwich is a blue-chip town,” Ms. Healy said. “It has so much to offer. It’s an expensive town but it’s always been.”
She added that the market is returning to a “more normal” state, and while houses are now staying a bit longer on the market before they sell, it’s no time to panic.
“People need to feel secure in their purchase and it takes time,” she said.
For sellers, “the news looks bleak, but it’s not,” Ms. Healy said, adding that when buyers get their confidence back, more houses will be sold.
“Nobody can time the bottom,” Mr. Bjork said, “and if we’re not there we’re really close.”
He added, “One of the benefits of Greenwich is it’s very stable. People can afford not to sell their homes. They take them off the market and wait.”
He said doing this may make the market freeze, but it means buyers are likely to have their investment be safe when they buy it.
“They look at it less as a financial play but as a quality of life opportunity,” he added.
With the government influxing money to stimulate the economy, Mr. Bjork said inflation cannot be far behind, making the case for owning property stronger.
“You can’t put a trillion dollars into the economy and not have inflation,” he said, “and at times of inflation, you want to own hard assets because they appreciate.”
“Anonymous” just tried to post the following: “You have 6 readers …”. I assume that he meant to hurt me by revealing this awful truth but I will bear up, knowing that I can count him as one of those six. In fact, I was feeling rather pleased today because my restrictive site counter (it counts each visitor only once every 24 hours – most meters count five log ins as five visits, even on the same day) shows 7,465 visitors yesterday. That’s abnormally high and is due to Instapundit’s linking to this site, but it’s fun all the same. Anonymous can check this out for himself by scrolling down on the right to ClustrMaps and clicking. The snap of today is here:
Running total of visits to the above URL since 16 Nov 2008: 40,992
Total since archive, i.e. 16 Nov 2008 – present: 40,992 (not necessarily all displayed – see below).
Visits on previous ‘day’: 7,465.
Current Country Totals
From 16 Nov 2008 to 8 Jan 2009
|United States (US)||37,345|
|United Kingdom (GB)||569|
|Saint Vincent and the Grenadines (VC)||74|
|Hong Kong (HK)||51|
|New Zealand (NZ)||36|
|Korea, Republic of (KR)||16|
|Saudi Arabia (SA)||12|
|United Arab Emirates (AE)||10|
|South Africa (ZA)||9|
|Cayman Islands (KY)||9|
|Costa Rica (CR)||9|
|Dominican Republic (DO)||9|
|Asia/Pacific Region (AP)||6|
|Virgin Islands, U.S. (VI)||6|
|Puerto Rico (PR)||6|
|Czech Republic (CZ)||5|
|Turks and Caicos Islands (TC)||4|
|Russian Federation (RU)||4|
|El Salvador (SV)||3|
|Antigua and Barbuda (AG)||2|
|Trinidad and Tobago (TT)||2|
|Netherlands Antilles (AN)||2|
|Brunei Darussalam (BN)||1|
|Virgin Islands, British (VG)||1|
|Saint Lucia (LC)||1|
|Northern Mariana Islands (MP)||1|
|Bosnia and Herzegovina (BA)||1|
I hear rumors that the lovely, callipygian Miss Hooper was once an item with a fellow who owned Urban Angler – in fact, this picture of the young lady may well have been taken while she was on a fishing expedition with him to the Seychelles. When Andy Madoff came aboard Urban Angler, he nabbed Miss Hooper away and now, pray tell, what can she fish for when hubby-to-be is soon going to be penniless and living in a cardboard box? Charles River trout are, I hear, an uninspiring trophy.
Eh – not so bad, I suppose, given the market. Those townhousey units called “Riverstone” on the Port Chester border sold well last year but the second phase must be dragging a bit, judging from marketing emails I receive from the builder. End units are now $899, which is down, a little, but I’m pretty sure the old ones priced at $1 million were actually selling for around $900,000, so posted price may now just reflect last year’s reality. We’ll see what this year’s reality looks like.
88 S. Water Street has not been so fortunate. I don’t believe the Whaba brothers managed to sell a single one before their lender took back the project. Some units are still for sale at prices ranging above $2 million but buyers apparently are balking at paying that much for a view of the Port Chester shopping mall, even if that view is softened by a soft haze of pollution rising from the Byram River. The citizens of Byram resisted this project fiercely, forcing years of delay, huge cost overruns and a decrease in scope and size that made a profit impossible. I hope they’re satisfied with the results of their labor, because those units that were built will probably stay vacant for a long time. Although here’s a thought: low income housing!
Things are beginning to look a bit more realistic all of a sudden. Yesterday I mentioned 317 Stanwich Road, a very nice house on 3 acres marked down from $3.950 (or close to that) to $2.225. That’s a bargain.
While I wouldn’t call 11 Quail Road a bargain, it’s a nice 11,400 sf new house built in 2004 on land purchased for $3.0 million in 2002. The place was listed for $8.875 last Spring, dropped to $7.875 in November and today chopped again to $6.875. I admire a frustrated seller who thinks in millions. 2 acres, round Hill Road neighborhood, under $7? Maybe next year that will look ridiculously expensive – today, it looks a lot better than $8.75 did.
Madoof’s bail revocation hearing was scheduled for this afternoon. Any news? Readers with better access to news, please let me know.
UPDATE: Decision due Friday or Monday. If it were done when ’tis done, then ’twere well it were done quickly.
Britain joins France, Spain, Ireland and Germany in criminal investigations of Madoff funds. If I have the story right, Madoff used Walt both for the Noel access to rich WASPs here in Greenwich and, thanks to the husbands of the Fabulous Noel Girls, introductions to the rich elite of Europe. Criminal investigations in the very countries the not-so fabulous Noel sons-in-law operated might, I say might, turn up things Walter would as soon not see the light.
Uma Thurman and Arpad Busson lose big with Madoff. Or something – the link is really to a Bloomberg story on “Arki” Busson and his bad year. I like this part:
“Catching a fraud is practically impossible,” Busson says. “There’s only so much due diligence you can do. This was not an obscure little manager in the boondocks. He seemed like a very experienced, knowledgeable, trustworthy man — like the best con artists always are.”
Busson says there’s still a role for funds of funds like his, because institutional investors find the screening and monitoring of hedge funds too time-consuming and expensive to do themselves.
Go ahead and try to square those two assertions – I can’t.
Not much to do with real estate, I’m just delighting in the new word I learned. Anyway, here’s another 1,000,000 barrel tanker filled with oil and anchored off Scotland – buy oil at $40, contract to sell it at $57m keep it ready for delivery until then, presto! Locked-in profit.
If the traders are right about where the price of oil is headed, however, this story may have an effect on real estate when you try to heat your home next winter.
We predicted that the day the story broke and certainly we weren’t alone in that brilliant bit of prognostication. You don’t lose half your $14 billion assets under management, defend yourself by claiming you were too unsophisticated to detect a simple fraud, and expect your remaining investors to stick with you. FGC was essentially dead December 12th. If the corpse is still twitching, that’s no more evidence of life than a pithed frog’s leg kick.