sucker punch?

joedavis, keep in mind that the lowballs reported here are the rare exceptions. The spread between last-asking and sale covers a pretty broad range, as you'd expect. A few close for more than the last asking, a few for ~20% less, with most falling in the 6-10% less range. No clue where buyers started their negotiations. All we know is where they end up.

NWT
I understand that the successful lowballs are anomalies. However, it is not clear that a starting offer at 20% below ask is so disparaging that in virtually all cases it does not even lead to a response. In many of the situations a contract signed shows up a few weeks to a month later. This suggests that many sales are happening close to asking prices which are in most cases 2007 or higher prices.
I do see that there are dramatic reductions in asking prices for very expensive properties, but in the 1 to 1.7 million price range in the UWS and Harlem things seem to still be moving at prices that do not show marked declines relative to 2007. Exceptions do exist as you note.
Either people are better at presenting or targeting their low offers than I am, or the sentiment does not seem to approximate the SE sentiment of imminent and continuing price reduction -- perhaps it will only be a creep in this creepy market.

many sales are happening close to asking prices which are in most cases 2007 or higher prices

thats good shit you smokin joe...guess thats why they call you smokin joe (the bro...)

Seriously?

C'mon. The people accepting severe lowballs have their apartments listed at ridiculous prices.

I know squat about negotiation or buyer/seller psychology, but IIRC it's been said here that by the time sellers have watched their places sit for many months, and dropped their asking time and again, a -20% offer might be too much for them to handle. If they're looking at the average spread (if that's what it's called) and thinking of -10% as normal, maybe an offer of -15% would be a better start.

Then again, the numbers are so all over the place, maybe a strategy per se can't be expected to work. Just have to wing it.

joedavis, unfortunately you are experiencing the difference between streeteasy myth (or is it hopes and dreams?) and market realities. Just because some goofball on this site says that “everything is 30% down” or to “make 50-60 lowball offers to increase your chance of success”, doesn't make it true. The market is the market and good properties will hold value better than lousy ones.

Right, individual sellers annoyingly refuse to adhere to the patterns we see. E.g., a sale above asking may be because the asking dropped enough to trigger multiple bids. Or not. Or a sale -25% below asking may not have had the usual previous cuts to asking, so seller took the beating in one fell swoop. Or not.

NWT -- right!
The pattern that seems to be there is that the properties that have seen multiple price cuts over a short period of time often take an even lower offer to close, and are "deals" relative to other reported closings -- at least on a psf basis for the neighborhood. Often they move when their asking price comes below the asking comps and then they take 10-20% lower still.
The others tend to keep sitting and do not respond to offers. An annoying feature is the number of realtors who don't even respond to your written offer.
The challenge is to spot such properties -- have not figured out a way to easily do that in SE.

Joe, patience. We don't know contract prices on most of the properties that have not yet closed in Harlem, and it's simply wrong to say that sale prices (at least in Harlem) are not significantly lower than lists. I'm renting in the Kalahari (having sold my Chelsea condo and put the money in CDs while interest rates were still good), and am seeing 500K below list prices once things go into contract. The "exuberant irrationality" of the "we have to strike while interest rates are low" crowd flies in the face of the macroeconomic fundamentals (unemployment, continuing credit crisis, ongoing mortgage reset problems, etc) which one has to keep sight of. Every knowledgeable commentator (calculated risk, financial armaggedon, automatic earth, business insider, baseline scenario) suggests that the magical thinking which holds that we've reached bottom is just that. The counter-trend of closings on your saved property (I'm seeing it too) should not obscure the big picture.

joedavis- just curious ... what have you seen go into contract recentely?

Jon Miller recently found that the gap between asking and selling prices has shrunk. So lowball bottom feeder buyers like joe davis are out of luck.

Yes, Alpine, they are out of luck but they can wait. Market is going down in Harlem.

Joe, are you working with a broker to represent your bid, or are doing it yourself?

"unfortunately you are experiencing the difference between streeteasy myth (or is it hopes and dreams?) and market realities"

JM - you are hilarious, dude. You call others "goofballs", but it seems to me that your hopes and dreams have been destroyed by market realities for the past 2 years. I think maybe you should look in the mirror before you mock others - you are the one who has been consistently dead wrong.

the patient bear is rewarded -- if one realizes that the lag of the market to RE is up to 3 years, then it should be easier to understand that people have time still to blow through their economic cushion. Prices will come down -- we are in the 3rd inning...

not working with a broker to represent my bid
am being patient -- 2 years into the search now
lowball yes, but Mr President if you own a 650k place now worth 300k or even your 900k spread in Alpine, you are below bottom scrounging

cherrywood excellent point -- I checked and you are right re Kalahari
still not sure if I would like to live in the Kalahari -- large building and pretty far walk from work, but would love to hear more of your impressions.
Main frustration so far is that the idiot realtors we have made offers to don't even respond. Tempted to go directly to the sellers.

just make more ofers.

You only need one to hit.

Here is my knee jerk reaction, so take it with a grain of salt:

You're not seeing "lowball" offers being reported as being accepted in Harlem on SE, you're seeing them in other places. The reason is that in a lot of cases, the lowball offers are being accepted by people who have more air between what they would like to get and what their basis is. Like estate sales on WEA where the estate is getting "100% windfall" so-to-speak. You're not seeing a lot of lowball offers accepted in the new projects in Fidi, either, because they also don't have the room to do it.

This is one of the reasons I was worried about people buying in Coop Village at market, because when the market heads South, you're in competition with tons of people who can sell for a number approaching zero and still not lose money.

Harlem (aside from the HDFC Coops, which it doesn't sound like you are looking at?) is mostly full of speculative sales, where people bought high and wanted to sell higher. Well, even if they can't sell higher, they are much more loath to seller lower (in absolute terms) than people who got in low and weren't doing it to flip at a big profit.

I could be totally off base because i wrote of Harlem as "too speculative" to pay much attention to several years ago and haven't looked at teh recent sales data, but - to joe - take a look at the properties you are talking about and try to see which one's are NOT new conversions (which I say by definition are speculative enterprises) and not bought by flippers. Try to winnow out one's which were bought a reasonably long time ago and have a low basis. Then try look at why they are selling and how much they need to sell. When you find one which 1) needs to sell, 2) wasn't bought "on spec", and 3) has a low basis - make your lowball offers there.

"just make more ofers. You only need one to hit."

presumably you have to actually like the apt, no?

Joe: I really like the idea of buying a Harlem townhouse. $/sqft is much lower than most apts up there, and it's a very viable long-term living solution.

ccdevi -- u r right -- have to like it
nyc10023 -- $psf is lower but condition/quality often match that, and there are issues with amenities and such.
I was interested in UWS/MH primarily for a 3br/2ba but never found one we were excited about in our price range. Shifted to Harlem and now UWS prices for the units we were not excited about are approaching or below the Harlem asking prices.
Cherrywood pointed out the 500k reduction on the Kalahari apt. Interesting, but we were not too interested in Kalahari, so perhaps pickiness is part of the problem.
30yrs -- good advice, and sound logic I think. Keeping my eye out on UWS as well and it seems that we may get a better deal for the reasons you mention. Have been trying the strategy you recommend, but hard to know "1) needs to sell"
It seems the new unit developers are not interested in selling.

On brownstones, yes several qualify on 1) but they fail on item 3) has a low basis. Typically these smart folks got a loan larger than their existing one everytime they were headed to foreclosure, and are represented by jerky realtors
I think it may be easier to buy an entire development soon than an individual apt. in Harlem

So, we are headed into the odd situation that UWS prices to close a sale may be lower than Harlem asking prices for sure pretty soon.
Thx to all

"On brownstones, yes several qualify on 1) but they fail on item 3) has a low basis."

As I said, that is why I think Harlem is going to be tough: to much Dutch Tulip syndrome.

It may be time to do something which people used to joke about to get a rent stabilized apartment: keep your eyes on the Obituary section.

"Joe: I really like the idea of buying a Harlem townhouse. $/sqft is much lower than most apts up there, and it's a very viable long-term living solution."

A Harelm brownstone is not going to be cheaper than an apt. when you factor in all the work it is likely going to need. If you buy a shell, you will spend at least 3 times as much on renovations than you will to purchase it.

The_P: you can't make sweeping generalizations like that (3X price). It's case by case. It all depends.

your right. But updating a shell is always going to be pricey since your essentially building a new house, minus the four exterior walls.

There are "shells' and there are "shells"........ some are literally just 4 walls, while others still have floor joists and staircases (which I wouldn't call a shell, but no one can even agree on what a "gut renovation" is).

I agree that with a shell you are essentially buying land and a liability in case the 2 exposed walls collapse. Hence 300 to 500k is very fair for a Harlem shell at this point. And yes, if you get it for that you could spend 3x that on construction. But if you pay the going rate of a million it is a silly comment -- unless your foolishness extends to spending 2 to 3 x what it should cost for construction.
construction costs quoted run from $160 to 300psf and 200 is achievable with some moderately nice finishes -- on par with many of the new development condos in the area. -- So if you plan to do 3000 sf and a cellar you may be able to do that for 1 million + land cost

I'll be interested to see what the closing price is for this 3000 sf "renovation."

http://www.streeteasy.com/nyc/sale/407055-townhouse-236-west-139th-street-central-harlem-new-york

less than 1 month on the market? wow, that was fast!

The loan was $1.6 million plus -- this is a sad story -- yet typical I think. The fellow bought an SRO without a certificate of non-harassment and took out a loan to renovate. CNH takes a while to show up and in the process the fellow goes broke. Various attempts to sell and then goes to a short sale almost a million below the loan value. I wonder who is paying for the loan gone sour.
Renovation on a building like this with "details" that have to be restored is very much a high variance cost estimate. If you do a lot of the restoration work itself it does not cost much. Check out the "Green in Harlem" blog. Impressive work by that fellow. If you hire people to do a period restoration with high end modern amenities it will be expensive, but still feasible in the 1 to 1.2 million range.