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Roubini buys real estate?!?
Old 12-30-2010, 08:43 PM   #1
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Roubini buys real estate?!?

Did Roubini just call the bottom of the housing market?

Nouriel Roubini Buys $5.5 Million Manhattan Condo - BusinessWeek

I know Schiller and others have been building their houses out of doom & gloom, but maybe there's a bright spot in the real estate markets after all.

Quote:
Roubini... took out an adjustable-rate mortgage that has a fixed rate of 3.625 percent for five years, according to city property records. The rate on the loan, which runs through 2041, will change in January 2016 and once each year after that.
In Manhattan, sales of luxury apartments, defined as the top 10 percent by price, jumped 19 percent in the third quarter to 266 transactions, according to New York-appraisal firm Miller Samuel Inc. Their median price climbed 12.5 percent to $4.39 million. Roubini’s purchase is more expensive than 96 percent of all Manhattan sales in the third quarter, said Jonathan Miller, president of Miller Samuel.
“Wow,” Miller said. “One of the most pessimistic economists who called it right, called the housing bubble. At first glance this could easily be taken as a sign that things are better.”
The three-bedroom, three-and-a-half-bathroom apartment includes a 50-bottle temperature-controlled wine refrigerator, a “custom walnut wet bar,” and a wrap terrace “ideal for sunbathing, stargazing and dining al fresco,” according to the property listing.
“Connected by a custom cantilevered steel staircase, each level of this amazing home offers something unique and unforgettable,” reads the listing by Richard Orenstein, a Halstead Property broker. “On the first floor, you’ll find a massive living/dining area bathed in southern light with 11-foot beamed ceilings, exposed brick walls, a wood-burning fireplace, and light from a 50-foot expanse of oversized windows.”
Maybe he's been talking down his book?
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Old 12-30-2010, 09:03 PM   #2
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I have a hard time saying "Roubini" without rolling my eyes.

Given his history as a gloom-n-doom predictor, I don't know what to think about his purchase except that perhaps he needed a place to live. He seems to have earned enough money from gloom-n-doom to allow for a purchase like that. Somehow I am not surprised.
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Old 12-30-2010, 09:05 PM   #3
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I think the key words are "luxury apartments". If he would have bought in Detroit or a similar place I would have been impressed. NYC is like Hong Kong - limited space with a high demand from bankers.
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Old 12-30-2010, 09:11 PM   #4
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The article failed to mention the underground bunker stocked with gold, guns, ammo and an undetermined supply of food and water...
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Old 01-01-2011, 03:41 PM   #5
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Or maybe he thinks only real assets will survive what's coming.
Others buy gold, but gold was confiscated last time things were that bad.
Doom! Doom! Doom!
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Old 01-01-2011, 10:44 PM   #6
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Quote:
Originally Posted by dex View Post
I think the key words are "luxury apartments". If he would have bought in Detroit or a similar place I would have been impressed. NYC is like Hong Kong - limited space with a high demand from bankers.
For $5.5M I suspect he could have bought Detroit.
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Old 01-01-2011, 10:47 PM   #7
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He got an ARM 'cause he's counting on economic devastation to keep lowering his interest rate for the next 20 years!

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Old 01-01-2011, 11:21 PM   #8
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For $5.5M I suspect he could have bought Detroit.
For a minute there I thought he bought Paulson's or Geithner's homes:
Ex-Treasury chief Paulson loses $1 million on DC home | Reuters

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He got an ARM 'cause he's counting on economic devastation to keep lowering his interest rate for the next 20 years!
Yeah, I'm wondering what he knows that we don't...
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Old 01-01-2011, 11:40 PM   #9
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some people think it's a good time to be buying....

Prices on places slashed to below replacement cost
interest lower than I can remember. ever.
huge inflation pretty much a no brainer.
everybody is selling.

buying makes sense to me. except those boys play with BIG numbers - i'm a country mouse.
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Old 01-01-2011, 11:46 PM   #10
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My daughter's offer on a short-sale townhome is being considered by the lender. Previous owner purchased in 2006 with 30% down.

My daughter's offer is the highest at 40% of that last sale price. Previous owner lost it all. Lender is mulling over his loss of 40% of his share. And I am thinking about selling some stocks or moving some funds to give my daughter the 20% down for the mortgage. Everybody loses. My daughter wins.

I know, I know, I have been spoiling my kids. But since I am not going to take it with me, and not going to spend it all, what's for me to do?
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Old 01-02-2011, 12:07 AM   #11
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.... But since I am not going to take it with me, and not going to spend it all, what's for me to do?

Been suggested that since I'm not convinced i can't take it with me that I hide my stash in the basement rather than the attic if I expect to pick it up on my way by...
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Old 01-02-2011, 12:12 AM   #12
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Well, I tend to think hiding the stash in the basement would be the right move for me personally.

But then, the asset allocator people would suggest 50/50. Half in the basement, half in the attic.

What do you think? Diversification or all on red (hint!)?
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Old 01-02-2011, 12:45 PM   #13
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Well I think at least some justification to buy gold... for the basement stash -paper $ won't last long.
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Old 01-02-2011, 01:04 PM   #14
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Originally Posted by audreyh1 View Post
He got an ARM 'cause he's counting on economic devastation to keep lowering his interest rate for the next 20 years!

Audrey
More likely he got an ARM because 1) there are a lot more lenders willing to make a super jumbo ARM than a 30 year fixed and 2) I bet there was a very large difference in interest rates between the two.
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Old 01-02-2011, 01:15 PM   #15
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Quote:
Originally Posted by calmloki View Post
some people think it's a good time to be buying....

Prices on places slashed to below replacement cost
interest lower than I can remember. ever.
huge inflation pretty much a no brainer.
everybody is selling.

buying makes sense to me. except those boys play with BIG numbers - i'm a country mouse.
We just invested in a second apartment building in Phoenix. The lender which financed the building gave the LLC (of which we are a member) a really fine interest rate with a seven year assumable loan. Plus, the price was right. Big numbers but we are just a relatively small investor. That makes two apartment complexes investments for us in Arizona in the past year. The first project has been performing nicely.
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Old 01-02-2011, 01:21 PM   #16
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More likely he got an ARM because 1) there are a lot more lenders willing to make a super jumbo ARM than a 30 year fixed and 2) I bet there was a very large difference in interest rates between the two.
Oh - sure! I was just being snarky!

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Old 01-02-2011, 01:28 PM   #17
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For a minute there I thought he bought Paulson's or Geithner's homes:
Ex-Treasury chief Paulson loses $1 million on DC home | Reuters

Yeah, I'm wondering what he knows that we don't...
I don't know what or who Paulson knows, but I am sure his "knowledge" is a lot more than mine.

So, he lost $1M, but that is out of an estimated net worth of $700M in 2008. To further put it in context, Paulson paid $4M for it. How many forum members can say that their dwelling is only 0.6% of the net worth? I am sure that if I sell off my houses, add the proceed to my stash, and move into my chintzy motor home, that I still cannot match that 0.6%.
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Old 01-02-2011, 07:59 PM   #18
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Quote:
Originally Posted by brewer12345 View Post
More likely he got an ARM because 1) there are a lot more lenders willing to make a super jumbo ARM than a 30 year fixed and 2) I bet there was a very large difference in interest rates between the two.
Quote:
Originally Posted by audreyh1 View Post
Oh - sure! I was just being snarky!
"If you can't say anything nice about anyone else, come sit next to me." — Gertrude Stein (and many others).

I figure he took out an ARM because none of the other lenders would even answer his phone calls...
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