For the first time in decades, no one has a good answer. “I’ve done this for 40 years, and right now this looks like complete chaos,” says Olshan. “If I could predict the market, I would be on my yacht cruising the Mediterranean right now, so I don’t hold much stock in my predictions—or anyone else’s, for that matter.”
That said, she continues, “I think the practical thing is that if you want to live in New York City, this would be an opportunity to buy. Because I believe things will have to be at a significant discount to incentivize people to buy.”
That incentive could be sweetened by mortgage rates that have hovered near record lows. Assuming that buyers can qualify for loans—by no means guaranteed in the present market—they can take advantage of cheap money to stretch their buying power. “People are looking at [mortgage rates] and saying, this is an opportunity to buy,” Osher says.
Cash is still king. “Someone who has a pile of cash right now—who can sit and cherrypick the market—is going to do fantastically well,” Olshan says. “The people who buy in these dips always do well, but it’s a risk.”
Takeaway
As the market reopens, “The greatest challenge now for brokers is pricing,” says Osher. “In the best of times, it’s more art than science—and right now, we have no idea where the market is.”
The separation between sellers’ hopes and buyers’ expectations “exists in the best of markets, and it’s going to be even more pronounced now, because every buyer is going to want a deal and every seller is going to think their property is worth more.”
The reassuring news, Miller says, is that this is almost certainly a short-term issue.
“What we saw after 9/11 is that the urban-to-suburban movement lasted about three years,” he says. “Human beings have an infinite capacity to forget the recent past, and I’m very confident that skill hasn’t waned.”
This article was provided by Bloomberg News.