With three months to go to until the end of the year, many claim it’s way too early to jump to conclusions.
Nevertheless, some brokers are saying that at least a few Wall Streeters are resuming apartment searches. In a turnaround from what was expected just a year ago, some of them are anticipating hefty year-end bonuses.
Goldman Sachs, for instance, announced in July that after two profitable quarters, it would set aside $11 billion for employee bonuses.
“I am a little surprised people are calling this soon,” said Richard Steinberg, a broker with Warburg Realty Partnership.
Steinberg said one of his clients is a Goldman employee who, after cooling his jets for six months, has reactivated his search for a four-bedroom, Upper East Side co-op in the $5 million price range.
“He won’t make a move until after he knows what his bonus is,” Steinberg said. “But I told him it was not going to be a V-shaped recovery, and that he should get back.”
Similarly, Daniela Kunen, a managing director at Prudential Douglas Elliman, has a Goldman client who “took a break after the collapse of Lehman,” but as of July was hunting again.
While his price target has come down, from $5 million to $3 million, the banker’s tastes haven’t changed, Kunen said. He’s still seeking an eight-room prewar Upper East Side co-op to relocate from his current rental.
“He thinks the market has hit bottom,” she noted. “He also knows he will get an excellent bonus this year.”
Market analysts warn against reading into any activity from Wall Streeters, saying that it’s likely not representative of any trend and that the finance sector is still in a precarious position. Jonathan Miller, president of appraisal firm Miller Samuel, pointed out that New York continues to shed financial sector jobs, with 5,700 lost in June, according to the city’s Office of Management and Budget.
Plus, “Goldman is not Wall Street. It’s just one company,” Miller said. “If they do well, it doesn’t mean everyone else will.”
Mitchell Moss, a professor of urban policy at New York University, said even if bankers come away with beefy paychecks, they are far less likely to spend them on pricey real estate than they were in the past.
“People will be prudent,” Moss said. “The spend culture has run its course.”
Goldman Sachs did not return a call by press time for comment.