By Ashkan Karbasfrooshan

We had a long conversation last week with Barbara Corcoran, whose real estate empire rose to the top of the NY residential world. She sold her company recently to focus on her media interests, but for all intents and purposes, she remains queen of NY’s real estate market. In this part, we talk about the real estate. Read Part 1 here, Part 2 here, and Part 3 here.

WatchMojo: Well, let’s get to it, what is your read on the real estate situation right now?

Barbara Corcoran: Well, right now I think we are definitely in the midst of a market turnaround. So, and hold on just one second, there are some good numbers that I’ve got this morning, and maybe because I always like to have an opinion than try to find the stats at support. For example, if you look at all the communities across America, they are usually always watched very carefully every month a hundred and sixty major markets.

For the first time in this quarter a hundred and twenty-seven of them went up in price; that is amazing to me.

I don’t think people realize that, you know because people are so much expecting more bad news that they are not on the game as to what good news are out there. And, some of the markets have gone up tremendously.

Markets that I think most people have written off as being in the dumps like San Francisco open area. I don’t think people realize that those house prices and condo prices are really shooting up all across the state. So, the main thing is a hundred and twenty-seven markets, and hundred and sixty markets are up for the first time in sales price. And, the bottom-line in this really, and I know a quarter doesn’t make a lifetime. But, it’s first time we saw prices go up in most of the major markets across the US, and somehow people have the moods for bad news I think.

WatchMojo: Bad news is good for a headline, yes. This article will be called Barbara Corcoran killed New York’s Real Estate market. Just kidding. So, what is your read on the recession and the economy overall?

Barbara Corcoran: Well, I think we have a lot of problems. We have fewer jobs; we have people mistrusting the economy in every ritual way. We have tons of foreclosures which is a terrible black file that hangs over the real estate market. And, Ash, frankly hangs over every market, because people don’t spend when they think they have supposed value you know. We have assured financing for all kinds of things, new businesses, homes; we have banks under appraising. So, people who have the cash to buy it find the appraisals were coming in too low, because it would be compared to less quarter spaces. And so, you have so much bad news that people are in a negative mood, but I think it’s slightly better than it was three months ago; don’t ask me why, but it seems my own circle of friends and business people seem a little bit happier. And, what else is going on in the economy, I don’t know. The only news I ever read is real estate frankly.WatchMojo: I’m a Web entrepreneur… so I must ask, how has the internet affected real estate?

Barbara Corcoran: Oh, it’s been a Christmas gift to the real estate market from the get go.

I am speaking about the internet overall. It took the keys out of the hand of the broker and handed them to the buyer and the seller. Now, a seller can appraise their on your home; they don’t need to go at real estate broker. The buyer could drive by fifteen houses; see if they like them from the outside without ever needing to ask the real estate broker if she would have an appointment on Sunday at two, you know.

So, what it has done is it’s set lose the statistics and the information within the marketplace and the inventory to anyone who wants it in easy fashion with just a click or two. What it’s done for the real estate broker that kicked and screamed in the beginning, because they didn’t realize how good this was, it’s realized them from the terrible labor of showing ten houses.

If people don’t like them onside of the outside it saves them endless phone calls of people saying how big or small is the room. Now, they look at the photos and dimensions online, and it’s made the negotiation process faster, and it’s dramatically increased the number of transactions a typical broker can do in America now, and almost double them, and I would say eight years or nine years.

So, the average sales from selling twice as material things I used to with the help of the internet. So frankly, there is absolutely, it’s been the Christmas gift to the real estate industry, and it keeps on giving you know.

WatchMojo: Do you think that real estate remains like the best long-term investment to make?

Barbara Corcoran: Yeah, I believe long-term, the question is how long-term is long-term.

You know prices have gone down almost exactly a third in three years, okay? So, most people would say my God, why would you ever want to invest in real estate, but I’ve lived through too many identical markets to this even if you’d say we’ve never seen it like this. No, it’s a different twist on the old thing, but it’s still the old thing you know. And, markets are very slow to unwind, but they recover in a flash. When they start to spin, they spin quickly and people will forget about this. You don’t think so, but people will forget about this the minute they have to bid against another buyer. People have short memories and besides just people have to live somewhere.

WatchMojo: Yeah, that’s true. You’ve heard of the greater fool theory that on the way down there might not necessarily be somebody there to buy an asset, but on the way up there will be someone who will be willing to bid higher.

Barbara Corcoran: Absolutely. And, people look comfortable with real estate, again the moment they have to buy in a crowd which happens quicker than people remember.

WatchMojo: Who do you blame – I know nobody likes to say blame and blame is a strong word, but we want a really negative headline (laughs). So who do you blame or what do you blame for the real estate mess?

Barbara Corcoran: You know what, I don’t blame anybody.

Everybody is responsible for their own actions.

And so, the bank has made mortgage money so available, so inexpensive, and so to some degrees deceptive. You know they were the lending industry, because the big lie that was told, and I don’t even think it was intended as a lie, was always you can “always refinance” and “what knowing envisioned is a house value going, falling below the mortgage amount. And so, the number one thing that people were counting on when they signed up for, so one, so I guess not to blame, but I guess one factor is certainly the over-promising mortgage market, okay that you could “always refinancing. The other thing is places were going up so dramatically in every market that you have to be a fool to sit on the sidelines if there was anyway you could buy and get it on the game. So, anyone who wasn’t buying, so like there were nobody, that they were left behind.

Anybody and anybody who could work an angle to buy a house is buying a house. So, you had inordinate amount of demand, so you can say hey, blame the buyer. I’d say don’t blame the buyer, anybody sitting in that position then is just like a fool if they didn’t buy. And of course, they promised you can always refinance.

You know just tease a rate 2% owner set for three years, oh three years from now, you don’t like it popping up you know, your monthly payment doubling; you could always refinance. Well, and then people lost jobs, they couldn’t refinance either on that sense you know.

WatchMojo: Tomorrow, we talk about NYC, and the hit – if any – it has taken since the econopocalypse.