Wall Street’s bonus blues are holding back Big Apple home prices.
While the housing market is on the mend and every other major metro area is on the upswing, New York stands out as the sole city to see an annual price decline, according to Standard & Poor’s Case-Shiller index released yesterday.
Home prices in the New York area were down 1.2 percent in November compared to a year ago — the only decline out of the 20 metro areas tracked by the closely watched index.
By comparison, home prices on average were up 5.1 percent from a year ago nationwide.
David Blitzer, chairman of S&P’s Index Committee, singled out the city’s shrinking financial sector as one reason it is lagging the rest of the country.
“Financial services is not in the best shape, and that has put a damper on the home prices and how people view job growth,” said Blitzer.
In fact, Wall Street bonuses have been shrinking ever since the financial meltdown.
Bonuses paid out this year are expected to decline, after falling 13.5 percent last year for work done in 2011.
“If it’s a good year for bonuses, it’s a good year for people selling real estate,” Blitzer said.
And for at least some of the well-heeled Gucci loafer set, who typically drive real-estate values in the city, bonuses could be off as much as 35 percent, according to Wall Street recruiters.
The office of New York State Comptroller Thomas DiNapoli’ estimates that the Street’s base salaries fell 9.5 percent to $362,000 last year, from $400,000.
Job growth in the Big Apple also has been relatively flat, with just about 500 jobs added in the securities sector over the past year, according to the Independent Budget Office.
That follows several rounds of deep cuts across the securities industry since the financial meltdown.
During the height of the crisis, some 140,000 jobs were lost, IBO data shows.
New York home prices held up far better than those in other major metro areas during the crisis, and the city wasn’t nearly as hard-hit as financially overheated areas like Phoenix and Atlanta, a spokeswoman with Mayor Michael Bloomberg’s office noted.
The index does not factor in co-ops and condos and covers territory including Long Island, Westchester and Northern New Jersey.
Median home prices within the city’s five boroughs stand at $445,000 and $380,000 in the broader New York metro area, while national median is closer to $175,000, according to Moody’s Analytics data.
Pay within the five boroughs on average is $61,0000 and $68,000 in the broader New York area, while the national average is $53,000. according to Moody’s.
New York’s housing market is very sensitive to the metro economy, said Michael Zoller, an economist at Moody’s Analytics.
“If the metro economy isn’t producing high-paying jobs, nobody’s going to be able to pay high real-estate prices,” Zoller aid.