From the Federal Reserve:
Beige Book – Second District–New York (Includes NJ)
Construction and Real Estate
Housing markets in the District have generally weakened since the last report. Virtually all contacts emphasize that there has been little activity in recent weeks and that it is too early to gauge the impact of the recent financial crisis on the market; there were frequent mentions of both buyers and sellers being in a “wait and see” mode. A contact monitoring New Jersey’s residential construction sector reports that both new home sales and new construction activity were exceptionally weak in August and that prices have continued to decline, with builders increasingly offering steep discounts.The inventory of homes on the market remains fairly high, though two contacts note that many sellers are discretionary and would take their homes off the market before reducing the asking price substantially. A number of contacts in northern New Jersey estimate that single-family home prices are down 20 to 25 percent from their peak levels; one contact notes somewhat steeper declines in prices for townhouses and condos. Housing markets on New Jersey’s Gold Coast (near Manhattan), where both multi-family development and apartment sales and prices had been showing some resilience, are reported to have weakened recently.
New York City’s co-op and condo market also showed signs of softening in the third quarter: prices were still reported to be up slightly from a year earlier, but lower than in the second quarter. Moreover, sales activity weakened noticeably, and the inventory of unsold units, though still fairly low by historical standards, was up an estimated 35 percent from a year ago. Manhattan’s rental market was steady to somewhat softer in September: on average, rents were running 4 to 5 percent lower in September than a year earlier, while the inventories of available rental units and the vacancy rate have been relatively stable.