Brrr! Icy January for Manhattan

Sure, the calendar is flipping to a new year, but that doesn’t change the same crummy market conditions.

“Almost all buyers need mortgages, and if you lower the interest rate on them, that will affect all buyers,” Michael Signet, director of sales at Bond New York, said. Mr. Signet is less concerned with year-end bonuses, which he claims only serve to benefit one segment of the market, Wall Street employees, and believes that lower mortgage rates will help a broader base of buyers afford new homes.

The rate on 30-year fixed-rate mortgages was down to 5.47 percent in the second week of December, according to Fannie Mae and Freddie Mac.

“If these things happen and credit markets loosen a little bit, it could bode well for Manhattan,” Jorden Tepper, executive director of sales for Century 21 NY Metro, said.

That is a big if.

“The direction of the market depends on the perceptions of the buyers; we are at the mercy of buyers,” Mr. Tepper said. According to Mr. Tepper, potential buyers are in a holding pattern, waiting to see the results of the year-end market reports, which will be released in January. In that case, a large price drop might be just around the corner, because many, including Mr. Miller, the author of the closely watched Douglas Elliman reports, are expecting low sales numbers from the current quarter.

“If those realities come to fruition, sellers are going to have to come to terms with reality, which might mean different pricing than the past year, when we were closer to the top of the market,” Mr. Tepper said.

If that is the case, it’s difficult to imagine anything would be able to change the course of the market.

“The real estate market is driven by positive energy,” Mr. Rosabianca, the real estate lawyer, said. And what could bring more positive energy than a new president who speaks so optimistically of hope and change? “In January, we are going to have a swearing-in ceremony, and statistics show that they always create positive energy,” Mr Rosabianca said.

So President-elect Obama, how much positive energy you got (and secondly, can you do anything about these credit markets)?

ohaydock@observer.com