Making an offer to a house

Are the apartments identical (same layout/view/etc)? When was the other recorded sale and for how long was the property listed prior to sale? How many units in the building? What other comps have you considered? Do you feel you understand this niche of the market you are exploring inside and out so that you are all but an expert in this niche? You are about to try to spend HALF A MILLION DOLLARS!!! Are you approaching this with the seriousness and devotion to educating yourself that such a large transaction merits? I worry because your post suggests you are just sort of "winging" this and don't know a lot about RE. There's nothing wrong with that, but you need to inform yourself thoroughly before it is time to start considering whether to make offers.

If you're downtown, I'm happy to help you put in an offer, because my firm specializes in Chelsea/Tribeca/Village/SoHo, and we can do a good job of adjusting for other comparable sales.

I don't know UES/UWS though, so if you're looking up there, you should get a neighborhood agent who specializes in one of those areas. For the UWS, I recommend West 81st.

ali r.
{downtown broker}
ali [at] dgneary [dot] com

Here's where the whole buyer broker thing gets very squishy in my view....and its not anyone's fault in particular....but here are the facts:

1. William Gray has apparently already done most of what a buyer's broker gets paid to do....search the market and find an appartment that is suitable for the buyer.

2. If William Gray approaches the seller's listing agent through a licensed broker, that "buyer broker" stand to collect between 2.5 and 4% (depending) of the final purchase price for his or her services. On a $500K appartment that is between $10,000 and $20,000. In exchange he or she will advise on negotiating strategy and not much more since the target property has already been identified.

3. For between $1000 and $1500 you can hire Jonathan Miller, certainly the most visible appraisal expert in the New York market, to do a full bore appraisal of the target....much more thorough than anything a buyer broker will provide in the way of analysis of the target properties value.

4. For around $300 to $400 per hour you can hire a very plugged in real estate attorney to handle your negotiations and possibly (probably?) pursuade the seller and his/her listing agent to give William Grey the benefit of NOT hiring a buyer broker in a reduced sales price....this of course will require the listing broker's cooperation....not easy to obtain but certainly possible....

All of which is tough sledding for the poor guy who just wants to buy an appartment...but required by the self serving laws governing real estate brokerage which prohibit buyer broker rebating to purchasers...(or at least make such rebating problematic)

So...William....what are you up for? Trying to save around $15K or not? Won't be easy.....

Pardon the math freeze...2.5% of $500K is of course $12,500....not $10,000

If William already "saw" the apartment, doesn't that preclude bring a broker/agent in at this point (at least one who expects to be paid by the seller)?

alanhart - I don't think so. They may tell you that, but I believe that you can bring in an agent at this point legally.

Don't you have to get the RE attorney anyway, regardless of your having a buyer's broker? If the speed of decline gains steam again (how knows!) Mr. Miller's appraisal could become obsolete in a few months, if, let's say, the offer is initially rejected and, subsequently, the sellers contact the buyer again... How unlikely is it for listing agents to accept a lower commission?

a good buyer's broker is worth their weight in gold. first, if they have a reputation they can push a lowball offer far easier than an off the cusp offer from joe nobody. second, if the apartment is already with a broker the seller will pay 5-6% anyway so the idea that they can get away with paying less if the buyer comes direct is generally false. third, there is a lot to do, especially in a co-op. if the person wants to spend almost all their time managing the purchase of an apartment so be it, there are a lot of those that don't/don't know the first thing about it and are lost, and then will resort to the seller's broker for help, who is on the opposite side. If they go to the attorney for help, they will pay more as you already point out. That being said, a good buyer's broker that works in the interest of the buyer (not a co-broker but one that is actually working for the buyer) is invaluable in this market, unless you really know the product, and let's be honest most buyers don't know the real differences between a co-op and condo.

Hubby and I are buying and our appraisal (which was not done by Jon Miller, who I have spoken on panels with and adore) is NOT the tool that I would advise anyone to use as a starting point in a bid negotiation!

For one thing, appraisers tend to value "pound for pound" but a pound of gold is a lot better than a pound of potatoes. One of the "comps" on our appraisal is a similarly-sized apartment to the one that we're buying, but with a layout that doesn't allow for conversion to an extra bedroom. If you think a one-bedroom and a convertible two are of equivalent worth -- then by all means hire an appraiser.

I have the same problem with attorneys. As a negotiator, I am certainly worth, in some instances, $10K or more to a purchaser, because I am aware of fine gradations of value because I know the market. How can someone who is reading contracts and offering plans -- admittedly a very valuable service -- possessed of this up-to-the-minute information?

This, btw, is why I said I couldn't do uptown -- I don't know the market well enough to add value.

If I'm hired to do negotiation only, I probably make $200 an hour (is this where I put in that I went to Harvard?) but if I save a buyer $20K, or keep them from making a million-dollar mistake, I assure you I'm worth it.

ali r.
{downtown broker}

thanks guys. yes I have no idea about real estate. The property is in williamsburgh 11211. Its a short walk to Bedford ave L station. The builder told me he will not go below 535K and won't pay the closing costs. Is this a good deal?

There is no way to know if it's a good deal without a link to the apartment.