Downtown openhouses

A LOT of pent-up demand.

Two stories:

1) A decently-priced Chelsea loft (needing, IMHO, some serious renovation) hit the market a couple of weeks ago, & got 60 customers at the open house, according to the listing brokerage (Halstead) before moving into a multiple-bid situation.

2) I've got a little studio at 3 Hanover Square -- which is a building that never attracts much Open House traffic due to its location -- and I'm not getting flooded, but I'm getting maybe twice the number of serious lookers that I got a month ago.

ali r.
DG Neary Realty

thank you. Both of those seem like "unique" properties 1) a total gut or at least a decent amount of renovating which not everyone is looking for and good percentage want a more finished product and 2) studio/size. What would be your opinion on the 2-3 bedroom market? What price are deals getting done (not ask but closing) either in price per sq ft or % down from peak (07).

Hmm. Downtown's a big place -- can I have a neighborhood or two please?

ali r.
DG Neary Realty

Tribeca (proper = north of Chambers, West of Church), West Village, Gramercy/Flatiron (south of 23rd).

Ali - Just curious - what do you think will happen in FiDi with buildings like 25 Broad and 45 John that are in foreclosure or have serious lender/sponsor disputes? How do you think it will affect buildings like 75 Wall and Setai that are complete but unable to sell out. I've been saying for a while that prices need to get to $800/sq foot before anything really starts to move but somehow, prices stay high.

Okay, so you want to live where everyone wants to live. (Thank you for not throwing "SoHo" in on that list, I would have had to shoot you.)

What I would call next-to-no recent trades in Tribeca (Please everybody on this board don't flood me with counterexamples, I'm knocking out a couple of new buildings that I hate, plus assuming your Chambers dictum means 200 Chambers = Triburbia, not Tribeca).

I see 55 White listed as sold, and that was last listed at around $1000/sf, but I haven't formally seen it cross Acris yet. Low floor. Also, we have a $1700/sf. trade at the Ice House, always a fancy condo.

Village is easier, we seem to be in the $1000-$1200/sf band that we were roughly pre-crash. That's not to say prices have bounced back apples-to-apples, because they haven't -- just that the rule of thumb is the same, only now I would tend to adjust down rather than up for X-factors.

Gramercy/Flatiron not as much my thing, though I have been been poking around there with clients for about a year. I consider the failure of the front unit at Ruggles House to sell as instructive as anything that actually did, so I'll say that things you might like are probably around $1,000/sf.

A corollary observation that you didn't ask for is that even though prices are down from peak, monthlies are up, mostly pushed by property tax increases, so buyers don't "feel" like they're getting deals.

ali r.
DG Neary Realty
ali [at] dgneary [dot] com

Thank you....and to your last point regarding taxes that situation will only get worse not only by the economic times but also by many of the 421 tax abatements that are about half way home on their 10 year ride. The $200 monthly tax will soon creep up to probably $2-3k/month.

junkie- You really need to consider the unabated tax rate when purchasing RE. A premium is appropriate for abated properties, but developers and real estate agents talk like these abatements will last forever. Do not assume that taxes will be free forever in your affordability and rent/buy calculation.

On the other hand, abatements that are coming off will create tax revenue for the city that wasn't there before so the rest of the community wil benefit from the overall increased tax revenue. With all the abated units on the market, we may even see property taxes go down in the next 6-10 years.

"On the other hand, abatements that are coming off will create tax revenue for the city that wasn't there before so the rest of the community wil benefit from the overall increased tax revenue. With all the abated units on the market, we may even see property taxes go down in the next 6-10 years."

Provided, of course, that the current occupants can afford the spike in taxes, and if they can't, that the market can support the sale of all these units that will be newly dumped onto the market.

the ones that are truly screwed are the new developments purschased near the top in 07 with abatements. Apts purchased around $1,500/sq ft for new development at the top (if not more) but back then it was offset by the low tax/monthlies. So current owner is going to take quite a hit if they try to sell those but now the monthly is more than double and by the time it is up quadruple+.

Maybe urbandigs can do an analysis of this trend. How many buildings are phasing out or completely coming off of abatements in the coming years and calculate how much additional property tax revenue there will be in the next few years based on the various expiration dates. It was reported a couple of years ago that tax rates had to increase due to the poor performance on Wall Street and the money has to come from somewhere to run the city. Now that Wall Street is back on its feet, we still get a 10% hike. New thread?