Posts Tagged ‘falling home prices’

Paul Krugman is Moving on Up

Thursday, September 10th, 2009

Paul Krugman – winner of the Nobel Prize in Economics, Princeton University professor and New York Times columnist – is taking advantage of falling home prices in a difficult market.  Krugman and his wife, economist Robin Wells, recently paid $1.7 million for a three-bedroom co-op apartment in a pre-war building on Manhattan’s upscale Riverside Drive.  The apartment had been on the market for more than one year and had an original asking price of $2.495 million, according to StreetEasy.com, a property listing service.

krugman-788178According to Krugman, “We really wanted a place that has the ultimate New York luxury, which is a washer and a dryer.  I do expect New York prices will fall some more, but we need a place.  And I came into some money.”  Krugman’s Nobel Prize included a $1.4 million cash award.  The six-room apartment has nine-foot ceilings, offers “romantic cityscapes” and has a monthly maintenance fee of $1,820.  Krugman’s long-time one-bedroom apartment on West 89th Street is under currently contract for a bargain $599,000.  Additionally, the Krugmans own a house in Princeton, NJ.

Median Manhattan home prices fell 18.5 percent to $835,700 from a year earlier, according to appraiser Miller Samuel, Inc., and broker Prudential Douglas Elliman Real Estate.  The number of sales is half of the 2008 number.

Krugman’s purchase comes at a time when the housing market appears to be stabilizing.  Existing home sales rose 3.8 percent in the second quarter to a seasonally adjusted rate of 4.76 million over the first quarter, according to National Realtor Association statistics.

Signs of Optimism Amid Battered Consumer Confidence

Monday, November 3rd, 2008

Layoffs and the promise of more to come, falling home prices and shrinking investment portfolios have created the highest level of consumer pessimism on record, says the Conference Board.  According to an online AP report, consumer confidence sank to just 38 in October, a significant drop from the rather rosy 61.4 reported in September. The Conference Board is a nonprofit business membership and research organization that is best known for its Consumer Confidence Index and the index of Leading Economic Indicators.  Its membership includes top executives and industry leaders from the world’s most respected corporations.  Consumer opinion is crucial because spending equals approximately 70 percent of all economic activity.

Despite the Conference Board’s report, good news does exist on the retail front.  Discount big-box stores are the bright spots, and Costco was the big winner.  The firm closed out its fiscal year on August 31, 2008, with sales up 13 percent compared with the previous year.  During September, Wal-Mart Stores, Inc., reported a 2.4 percent rise in sales as cash-strapped shoppers purchased food and medicine from the retailer.  Wal-Mart’s Sam’s Club warehouse division reported an increase of 4.6 percent.  The more upscale Target Corporation reported that its net retail sales during the five-week period ending October 4 increased by 2.5 percent.