The luxury of renting in Manhattan

You hear a lot about the US housing bubble and crash, prices are down all over the US since the peak, but in Manhattan luxury home prices have risen since last year.  So what are the wealthy doing?  Renting.

Adam Neumann and his wife set out in 2008 to buy an apartment in lower Manhattan, hoping to get a bargain on a 2,500-square-foot (232-square-meter) luxury unit.

Failing to find a deal, they chose an increasingly practical option for the city’s wealthiest residents: renting. They’re paying $300,000 upfront on a five-year lease for an empty TriBeCa loft with almost twice the space that the landlord will outfit to their design.

A price crash does funny things to perception.  So why would the well-to-do choose to rent instead of own?

The money he’s not spending to buy “can go into my business,” said Neumann, co-founder of We Work, a New York firm that rents shared office space by the month. “In my business, my cash brings a much higher return than purchasing an apartment,” he said.

“The good times we saw in the past are not coming back anytime soon,” he said. “People are not going to buy a home for $1 million and see it worth $2 million in five years. I see the market going up but nothing like in the past.”

But what about here in Vancouver?  Is that $1 million dollar home going to be worth $2 million in five years or are there potentially more lucrative sectors to invest in at this point?

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Laibach
Laibach
9 years ago

@French:

Dude, you better leave and take some nap. As we progress through the day you sound more and more miserable. Stop to embarrass yourself.

Spec
9 years ago

@French:

pa·thet·ic/pəˈTHetik/Adjective

1. Arousing pity, esp. through vulnerability or sadness.

2. Miserably inadequate

Example: Posting RE BULLshit with sockpuppets. Pathetic.

Bob
Bob
9 years ago

Perfect Storm brewing for 2011:

– increasing fixed rates (variable by summer)

– stagnate jobs/economy (we’re now worst GDP growth per capita of G7 – behind Italy)

– final leg of commodity run (especially p metal) last major commodity peaks 1920, 1951, 1980…2011?

– 2nd leg down underway for US home prices

– among highest debt/income levels in world (worse than US)

– China slowing (property bubble bursts 2011?)

– Canadians finally realize we’re not special after losing world junior hockey championships, again

vreaa
9 years ago

2010-2019 Prediction – Annual Update –

"The Vancouver RE Bubble is like a large festering carbuncle on a dinner guest's nose – so clearly present yet publicly unmentionable."

Not much new on RE -> ripe for a fall.

With some peripheral thoughts about stocks and commodities.

see:
http://wp.me/pcq1o-1FA

Junius
Junius
9 years ago

#64 French,

What is the matter Frenchie? Didn't get the memo from CREA?

Junius
Junius
9 years ago

#63 Painted Turtle,

Turner's Blog is really interesting. Ironic considering all the bashing the Cow crowd was giving him here today.

Shows you how immoral the whole Re cartel is. They clearly know they are in trouble if the CMHC rules are returned to even a 10% down with a 25% amort ceiling. They know it is all about cheap credit.

Budget watch just got interesting. Could be End of Days.

French
French
9 years ago

Typical hardcore bear attitude, instead of checking out the merits of garth's predictions, (which suck by the way…)immediately go on ad-hominem attacks against the messenger.

Our RE is not in a bubble, the hardcore bears are.

And now here they are again, waiting for the daily numbers from paulb like pathetic drug addicts.

There is nothing wrong with being a bear, but the bears on this blog cant have a normal debate on a subject, they just wish and hope for a financial disaster to hit all and every homeowner, which in turn they believe will allow them to become homeowners themselves or become RE magnates by scooping cheap houses and flipping them 2 years down the road for %500 gains.

PATHETIC!

painted turtle
painted turtle
9 years ago

Excellent post at greaterfool. The analysis of the situation by Realtors says it all!!! “Additional changes to mortgage financing rules would raise the barrier to homeownership excessively and destabilize housing markets and the economy. In particular, we are concerned about the negative impact modifications to the allowable amortization period or minimum down payment requirements would have. These changes would create affordability problems, especially for first-time buyers. First-time buyers are the first link in a chain reaction of real estate activity. They allow existing home owners to change properties or rent. “Creating burdensome barriers for first time buyers will seriously impact the rest of the market, including retirees looking to downsize. Further tightening of mortgage rules would have other far reaching consequences for the economy. It risks causing a home price correction, a drop in the net worth of Canadian households,… Read more »

jesse
9 years ago

@VHB: Maybe there's a rush to clear debts before CNY, or just a plain old-fashioned rush to the exit.

VHB
VHB
9 years ago

@Best place on meth: We had 5147 listings in January 2010. But many of those were 'borrowed' from February, since people were avoiding the Olympics. I wonder what the rush is this January?

Best place on meth
Best place on meth
9 years ago

@VHB:

Based on 2 days out of 20 we're on pace for 5170 listings, 1640 sales and 31% sell/list.

Best place on meth
Best place on meth
9 years ago

@Junius:

>>>I think we are out of Bulls and only left with dumb Cows. Really getting sad.

I guess this is how it ends.<<<

Bulls or cows, doesn't matter to me what they are as long as they get slaughtered.

VHB
VHB
9 years ago

Chipman posted the complete pdf of the REBGV release. Thanks, RobC.

VHB
VHB
9 years ago

@paulb.: Thanks Paulb. Very nice of you to do this for us. In a couple more days I will start posting the end of month projections.

Thanks especially for the total inventory count.

Note that we gained 163 units today, net. If we sustained that over 20 working days of the month, that would give us a gain of 3K+, which would be unprecedented.

Over the last 5 years, the biggest monthly inventory gain was 2456 in January 2010. Next best was 2319 in May 2008. I wonder if January 2011 will beat the record?

Junius
Junius
9 years ago

Amazing day. Some of the dumbest posts I have seen in a long time by the Bull crowd. Now that they are out of arguments they have restored to attacking Turner and other bubble predictors.

I think we are out of Bulls and only left with dumb Cows. Really getting sad.

I guess this is how it ends.

Renting
Renting
9 years ago

French (weep or garth) is also "reality check" from a few days ago with the fake story about renting for 4 years having 1 Mil in US funds collecting interest. Remember the sad story about not buying and wasting money on rent. Same IP, lots of stories.

jesse
9 years ago

@Renting: Nah they're probably different people but posting from the same Realty office. 🙂

Renting
Renting
9 years ago

: In case you didn’t know, your IP address proves you are also Garth’s Predictions…

He is also "weep for my city" who posted the fake $123,000 over asking Rich Chinese story. Check the IP from 2 days ago.

Best place on meth
Best place on meth
9 years ago

@Garth’s Predictions:

Is that you, McLister?

Go back to your worthless cheerleading blog and shut the fuck up.

http://www.canadianmortgagetrends.com/canadian_mo

And stay there.

jesse
9 years ago

REBGV stats are out.

Detached benchmark $797,868 +4% YOY

Apartment benchmark $387,115 +1.2% YOY

logic
logic
9 years ago

@ Garth's Predictions and French:

Agreeing with yourself under different names has to be THE lamest thing on the interwebz, and that takes some doing. Retard.

scullboy
9 years ago

French/Garth's Predictions:

OOOOOOO Busted, dude. Guess you didn't know what the trippy little icons were for, huh?

I think it's important to draw a line between Garth's predictions, and garth's advice. His predictions may well be off, but the general gist of his advice is good.

Of course it's also free, and you get what you pay for.

Alum
Alum
9 years ago

My comment is voted down. Before it hides, I repeat it for others if they want to refer to it:

=================================================

Poor bear should shut up

condo unit list tracker, which was designed to measure strength of housing market, is at all time LOW LOW of 223.

Poor bear: it was 600+ not long ago since you were posting here.

I don’t buy the bullshit of housing bubble. period.

Savvy Investor
Savvy Investor
9 years ago

@French: In case you didn't know, your IP address proves you are also Garth's Predictions…

French
French
9 years ago

@ garth's prediction

nice job dude!

Garth Turner is the modern incarnation of a charlatan.

A real fear mongering shyster.

I used to read his blog as there were insightful comments from time to time, but nowdays it has become all about people writing to Garth telling how he saved their life and how wonderful and great he is. That is what censorship does I gues, personality cult.