Plymouth Tower

we looked at several units - nice big apartments, nice building with good amenities -- location is fair. When prices drop another 10-15% will rethink it. So much for sale in that building, and they have been undercutting each other to be the lowest. However, the neighborhood doesn't justify the prices they're asking. We would rather be 10 blocks further down and its not like there isn't choice today. Yorkville has lots of cookie cutter one bedrooms.

Thanks. There never seems to be a shortage of available apartments in that building. The one across the street is less expensive and the apartments are slightly larger, but amenities are fewer. It seems very nice though. Both seem like nice solid buildings--nothing fancy or flashy, which I actually prefer. heltr, I'd be very interested in what you think a good price would be for a one bedroom on the 15th floor or above. Views differ slightly, but not a big deal. Do you think they'll go below 400k?

Where do I think they will end up? I am fairly bearish on Manhattan, so my guess is lower mid 300Ks by the end of the year. The one in contract at 340 E.93rd was asking 429K and was 22nd floor. In the building across the street, an estate sale just went into contract, asking 389K (10th floor) and another in contract on 22nd floor asking 425K. While it will take some time to see closings, I expect all of these apartments will close below 400K (obviously the estate sale will). If I had to offer today (which I wouldn't, too much risk of loss of capital) $360-375K renovated.

I think it is a matter of time. 3 months ago the broker speak was that "board wouldn't approve sales unless they were inline with recent purchase prices". Bold words, but we have yet to see closings and hence comps. It is interesting to note that the apartments in contract are the lowest priced, yet on high floors. The other apartments are clearly overpriced.

Interesting. Right now prices seem all over the place -- one on a high floor is listed close to 50k lower than one on a low floor (no view) (all of the one bedrooms are essentially the same cookie-cutter layout). I think there's room for negotiation on most, but some people are still holding tight. I think it's too early in the season for sellers to accept 10-15% off ask. May have to wait until summer. Some have taken their apartments off the market. I guess they expect a quick recovery, but I don't see that considering all the job loses in the city. This is the low end of the market, but I think it still gets affected -- at least by the negative psychology.

I can't imagine apartments in those buildings getting down to lower $300s unless major renovations are needed. But it probably can't hurt to sit on the sidelines and see. Doubt they will just spike back up to 2007-8 prices.

"I can't imagine apartments in those buildings getting down to lower $300s unless major renovations are needed."

If you look at 2004-2005 prices you see prices from the low 200K to low 400Ks -- quite a range. The majority fall in the 340-350K range. Most closings happening today are at 2005 prices, that is why I said I expect prices to fall into this range. Just yesterday, apt 6K came down 41K to 429K. The pressure of the comps is a leveling force. Frankly, what people ask IMO, is somewhat irrelevant. Buyers are looking at peak prices and offering 15-25% less. And articles like the front page of the NYT today wont help offers either.

This is a strange sector of the market. First time buyers tend to skew the market -- many are not too savvy when they want something and believe anything their broker says so they offer close to ask etc -- but as they are less likely to be able to get a mortgage and buildings are less likely to take guarantors, the cushioning effect from these buyers is less evident than in the past. Should bring this part of the market to 2004-2005 prices like the rest of Manhattan.

Another factor to consider are the rent/buy comparison. These apartments are renting for as low as 2K/month. With maintenance ranging from 850 (low floor) to 1150 (high floor) that doesn't leave much to pay a mortgage. Even factoring a tax saving -- these numbers don't look good. I still believe these apartments have a ways to fall.

heltr,

You make an excellent case for lower prices in those buildings overall. Also, the area is really mediocre and far from the train (I'm not counting on the 2nd Ave. subway finishing anytime soon). What you say about first time buyers makes a lot of sense-- that even if less savvy, first time buyers agree to higher (but reduced) prices, they may not be able to close the deal. I'm tempted by the reductions so far, but I think I'll be waiting and watching into the fall.

Curious if anyone pulled the trigger after 3 years....