Residential brokers try to navigate new playing field

New York /
Sep.September 17, 2008 04:47 PM

After months of contending with the credit crisis and national housing slump, New York City’s residential real estate market is facing another very sizable hurdle: the fall of Wall Street.

With much of the city’s money tied up in the financial industry, brokers are bracing themselves for the real estate market to take a hit as financial giants like Lehman Brothers, Merrill Lynch, and the AIG are floored.

“What we have here is an elevation of anxiety that’s hit the market,” said Pamela Liebman, CEO of the Corcoran Group. Brokers must act as “part psychiatrist, part hand-holder,” she said, as increasingly more cautious buyers and sellers approach the market.

Joyce Pohs, a sales associate at Bellmarc Realty, said she is already feeling the crunch.

“There is a definite sense of ‘let’s wait this out, and see how far the real estate market will fall,’” Pohs said. “When Lehman fails, AIG is in disarray and Merrill gets absorbed, it’s hard to argue with a wait-till-December-and-see approach. I just had an offer for a posh Fifth Avenue residence withdrawn.”

Veronica Raehse, an executive vice president and sales manager at Bellmarc, agreed that buyers are going to become even more cautious, but notes that despite Monday’s bad news, Tuesday was a busy day at the Bellmarc West Side office; there were three accepted offers and two successful rental transactions, but she agreed that bad economic news will only make buyers more hesitant to pull the trigger.  

Newer brokers may struggle the most.

Barbara Fox, president of Fox Residential Group, said that newer brokers “who have only known boom times” may be in for a shock as the market tightens. “Deals have been falling out of heaven for the last 10 years, and they’re not going to be falling out now.”

In terms of the city, the Financial District will feel the hit more than the rest of Manhattan, Fox said.

Apartments there are “a very tough sale right now,” she said, and with the week’s bad news, it will be even tougher. “People are not moving in to the financial industry, they’re moving out of it,” she noted.

Citywide, “I don’t think any business in New York is going to be exempt from this particular set of events,” Fox said.

But people aren’t walking away from signed contracts, they’re simply holding off on making offers until the market settles down, Corcoran’s Liebman said.

She said she remains optimistic that New York’s real estate market will not suffer long-term. “New York is very different. It’s a place [where] everyone wants to be,” she said.


Related Articles

arrow_forward_ios
Matt Lauer exposes Hamptons estate to the market
Matt Lauer exposes Hamptons estate to the market
Matt Lauer exposes Hamptons estate to the market
 Fredrik Eklund and the property (Getty, Steve Frankel)
Fredrik Eklund lists Bel Air mansion for rent as family moves to “forever home”
Fredrik Eklund lists Bel Air mansion for rent as family moves to “forever home”
Gordon Ramsey and his Lucky Cat restaurant (Lucky Cat)
Gordon Ramsay to open first South Florida restaurant in Miami Beach
Gordon Ramsay to open first South Florida restaurant in Miami Beach
Robert Durst (Getty, iStock)
Robert Durst is on a ventilator with Covid: lawyer
Robert Durst is on a ventilator with Covid: lawyer
Zillow CEO Rich Barton (Getty, iStock)
Zillow hits the brakes on iBuying
Zillow hits the brakes on iBuying
More than 27,000 Long Island households behind on rent
More than 27,000 Long Island households behind on rent
More than 27,000 Long Island households behind on rent
91 Sergio Franchi Drive and Sergio Franchi (Sotheby's, Getty)
Sergio Franchi’s 200-acre Connecticut estate lists for $12.6M
Sergio Franchi’s 200-acre Connecticut estate lists for $12.6M
Automatic for the people: SmartRent CEO on why landlords are going all-in on connected homes
Automatic for the people: SmartRent CEO on why landlords are going all-in on connected homes
Automatic for the people: SmartRent CEO on why landlords are going all-in on connected homes
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...