With apartments piling up on the market in Manhattan, isn't this the time to snap up the real estate equivalent of buying Champagne on a beer budget?

The savviest minds on Wall Street say it's not.

Even though prices have fallen around 20 percent as Wall Street's ranks have been thinned on fallout from the financial crisis and recession, top economists, strategist and analysts at the Reuters Investment Outlook Summit said they would be in no hurry to purchase a slice of the Big Apple.

Many expect prices to drop even more, as much as another 25 percent as unemployment rises.

Absolutely not, Nouriel Roubini, an economics professor at New York University who is known for his prescient call on the financial crisis that has gripped global markets over the past two years, said when asked if he would buy Manhattan real estate.

With all the job losses, whether it is Wall Street or otherwise, demand is very weak, Roubini said. I think prices are going to fall very sharply.

He sees Manhattan residential real estate prices dropping another 20 percent to 25 percent. Home prices in New York dropped 21 percent in the first quarter compared with a year ago, though they had held up relatively well until the second half of 2008 when financial markets seized up.

Greg Peters, global head of fixed income and economic research at Morgan Stanley, also predicts another 20 percent in New York City. Brooklyn, I would have down 30 percent, he said. Although I would move to Brooklyn before Manhattan, actually.

Robert Prechter, founder and president of Elliott Wave International in Gainesville, Georgia, and known for his prediction of the 1987 stock market crash, of Manhattan real estate said: I would probably put it on my list for an eventual bargain.

Up until the bankruptcy of Lehman Brothers Holdings Inc last September, New York City seemed immune to the real estate woes plaguing the rest of the country. The dominance in the Manhattan real estate market of cooperative apartments -- as opposed to condominiums -- that impose their own strict financial standards on buyers was seen as protecting the market against the foreclosures and repossessions that had already decimated other areas of the country.

But though Manhattan still hasn't experienced the wave of foreclosures seen in other areas, the golden days of ever-rising prices and rapid sales of multi-million-dollar apartments have evaporated.

The demise of Lehman and the disappearance of Bear Stearns Cos. and Merrill Lynch & Co. through distressed sales have transformed Wall Street.

The securities industry, which helped boost city and state tax surpluses in the last boom, has axed 21,800 jobs over the last year. And the heady days of year-end bonuses that financed the purchase of high-end apartments have fizzled out, leaving the real estate market holding the equivalent of a glass of warm, flat Champagne.

In a city where the securities industry accounts for almost 35 percent of all salaries and wages, New York's jobless rate climbed to 9 percent in May, its highest since October 1997 and up from 8 percent in April.

The pink slips have been felt.

The number of sales in new Manhattan apartment buildings dropped a whopping 71 percent in April from a year earlier [nN1497848].

And there may be more bad news to come.

If there's going to be higher taxes as we've seen proposed, you're going to have caps on bonuses or income, and this city is a little bit more dependent on Wall Street than a lot of other places, said Tobias Levkovich, Citigroup's chief equity strategist.

Reuters did find one interested party. Dino Kos, who previously ran the New York Federal Reserve Bank's markets desk and is now at research firm Portales Partners, told the Summit: If I had the money, yes. Yes, if I had the money. But I don't. Too many years working in the public sector -- public sector will do that to you.

(Editing by Leslie Adler)

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