Random Advice

Forget what the seller's broker tells you. Offer what you think the unit is worth based on your own research.

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It's our broker that is going over the comps. Yes things have sold for better price per square foot however, I feel to some degree in NY you have to go building by building as things change so much (facing a wall, what the building offers) etc...

do you have a real buyer's broker? because if not, that broker represents the interests of the seller. do your own comp work, or ask for help here.

but downtown has been a tough market. all i can tell you is that a number of properties have done well, but VERY few seem to have sold.

Thanks for you help. Take a look at this and let me know if you have any opinions.
http://streeteasy.com/nyc/sale/579840-condo-49-east-21st-street-flatiron-new-york

Also wondered if anyone had any opinions on the TEMPO

sorry to be a nattering nabob of negativity, but that price at 49 east 21 is crazy. very little is closing in this neighborhood, and a few places are getting their asks, but it's few and far between.

i can't see how tempo could possibly be worth it at this point. and i even don't mind the neighborhood.

Nice looking place!
Sounds like your broker is trying to be realistic about the number where it will eventually trade. Common charges are high, but ppsf seems on target. It's outrageously expensive, sure - but it looks like the property and the building haven't had any trouble attracting buyers. Your broker will of course submit any offer you determine you are ready to make, but he/she is erring on the side of caution: sure, you can lowball, but chances are yours won't be the only offer on this place.
The sellers will evaluate offers based on a number of factors, not just price. If you are a cash buyer you can expect a significant discount. Better qualified buyers have the upper hand in the market, as financing is so tight. If you're bidding low and don't want to come up, stick by your guns and keep looking. Don't fall in love with this one property. Good luck!
Tina
(Brooklyn agent)

tina, are you kidding? one apartment sold in the last year for this price. many others didn't sell at all.

Thanks All. Im not sure the Tempo has it's C of O. I can't tell what units are really selling for and I honestly feel like our broker does err on side of caution but then I see things we like selling for much less then ask and if I had listened to him I would be grrrrrr. I don't want to low ball but I also want to put in bids that are line with the market and not feel like I'm being led down the wrong path.
I just can't see how these condos are getting the same if not more than what they got in peek market.

DTDWIH: Why don't you want to lowball? That's what the current owners did.
aboutready: I'm not saying the OP should pay asking price. I'm just saying if the broker is just looking at comps it's pretty much right on. I'm saying the buyer should submit an offer he/she feels comfortable with and stick with it (or offer lower and come up, if that's how they want to play it).

tina, i'm saying the comps aren't pretty much right on. one sale in two years at a comparable level does not a comfort level or a comp level make. other comps were lower.

and that much more than a 2005 sales price for the same unit? i don't get where you're coming from. and this is me, well aware of how overpriced the downtown market is.

aboutready, what would you offer? Tina too? I know you didn't see it but your guys/gals are seasoned...

now that's interesting. let me think about it and get back to you tomorrow.

btw, i'd never bid on tempo.

Cool. Thanks for your input. Anything beyond our brokers input would be a gift. I think this site is amazing and I wish I would have done a post a while ago. Tempo was way too loud on the lower floors which was what we could afford so we passed. It would have been awful.
One thing about 21st is it's back of the building. There is a garage next door that is several flights lower. It allows for really nice light but this is def. one of those places where the potential of a building going up where the garage is could happen and would ruin the light...
other than that. Limited closet space but a nice place with good finishes. Nice prewar/new condo blend.

Why don't you ask the broker who owns the air rights above both garages outside your windows? If I'm not mistaken both buildings are garages? If so imagine waking one morning to find out one if not both have sold to developers to construct a building( s). Good luck trying to unload it then. I agree with your original post/question. No way prices have gone up 20%. Seller should be happy to hit a flat bid and get out at minimal cost.

2005 was not peak market, and you're not paying those initial transfer taxes. I think the neighborhood is actually more desirable than it was in 2005, too. Current owners paid $1.4m - over 12% discount off ask, a successful lowball bid. They are probably not in as desperate straits as the person they bought from, but we don't know that. They could just be floating a high number to see if anyone bites, and if not, they'll stick with it. At any rate, let's say they don't want to lose money on the deal. $1.55m should put them in the black. Anything over that is profit.
What should you offer? I really can't say. But don't be afraid of making a low bid. There are lots of compelling reasons to do so, and almost no reason not to. You can always come up a bit when they counter, and settle at a place you feel comfortable. If you get outbid, so be it. There will be other places. In fact, there are some right in the building!
Tina
(Brooklyn broker)

I would start with a bid similar to the closing price of other units in the same building, around a $1000 a square foot.

http://streeteasy.com/nyc/building/49-east-21-street-new_york

There's a closing for a similar unit in Dec, at $1.4, why do they think that a higher floor is worth that % of markup? Too much.

Bid low, what's the worst that could happen? They say no, you offer higher. Big deal.

Hi Needsadvice: i don't see the 1.4 in december. I see it in 2009 and that happens to be the exact same unit on the market that we went to see that's 300 plus higher

$1.4 puts it at almost exactly the early 2005 price. i'm too lazy to look it up on ACRIS but from the building's sales patterns it looks as though it was one of the early sales, so the 2005 price may reflect an earlier contract date. which means that the '09 purchaser who got it for $1.4m likely did quite well.

the average condo price for this area is definitely above $1k psf, although not much is closing. having said all that, the comp is what it is, and this was a conversion so total monthly costs are higher than for many of the other new developments in the area. i'd start at $1.45, and see what happens. if your offer is scorned do not hesitate to return with the same offer if the apartment languishes on the market for a few months. if you're dying for the space, adjust initial offer accordingly.

The Real comps are what has sold in 49 East 21st in the exact same line - "C" line. And the answer to that is pretty simple when you look at history. Floor differential has some play but in line comps of the same building are your best measuring stick.

A lot of people pull comps from outside buildings which I disagree with because each building has it's own trading environment and varies. I would only use outside of building comps if there is nothing within 1) the same line in that building and 2) there is nothing within the building - that has similar views, reno..etc. And if you go out of building you need to find places that replicate the subject place.

And you should make sure condition of in line comps is similar. If not adjust for variations when coming up with value.

it's a same unit resale. the comps are from two prior sales of the SAME apartment.

I specialize in downtown: we're in a very bifurcated market. There are properties that aren't closing at all, and properties that are causing, for lack of a better word, group gropes.

West 19th had 60 customers at the first OH, and supposedly eight bids in the first round. 108 Reade, a small 2-BR walkdown, just went to best and final a week after listing. Both properties, in the view of my clients, needed work.

My guess is that your broker isn't just pricing off past comps, but that he/she is taking into account the total scrum that certain 2-3BR properties are causing.

Sounds to me like your broker is doing a good job. As others have pointed out, the way to test that is to put in lower bids, and see what happens.

ali r.
DG Neary Realty

It sounds like you're doing fine with your reasoning & pricing; it's YOUR money so don't let the broker tell you how to spend it. Someone mentioned high monthlies. Remember that your purchase price will not change but your monthlies will only increase. Make the bid you're comfortable with & see what happens & don't fall in love with an apartment until after you buy it. Good luck.

The Broker is running comps all over the neighborhood and going back almost a year since there is so little activity. Pointing out to us that if we notice the most recent comps, albeit small, are much higher than the earlier comps. Meaning that pricing is more like 1200 plus per sq. foot. I just have a difficult time with the same unit going up 350k in one year and being adviced that it's in line with market.
It just feels like something is not right.

comps like this one?

http://streeteasy.com/nyc/sale/182543-condo-27-west-19th-street-flatiron-new-york

Hi, No funny that one was left out. This gets me really annoyed.

there are others. some can be explained away (it's a coop) but still should be considered. are you an SE insider?

Hi, Yes I am. I guess I'll have to look at my own comps in future. I generally look at the building I'm looking in as I think all places are unique and hard to gauge one against the other sometimes. But I do see overall not much is selling. There also is little inventory. We've been told we have a tall order, downtown, 2 bed 2 bath, light, doorman, reasonable space,condo under 1.6k as we want what many want and there isn't much out there etc.. etc...

I see this listing from December, 2010:
http://streeteasy.com/nyc/sale/553016-condo-49-e-21st-st-flatiron-new-york

No longer available in Dec, probably off the market for the holidays.

Why not contact their broker, and see what the deal is? If it comes back in the spring at $1.4, will you be bothered?

needsadvice, the second floor probably doesn't meet the light requirement.

DTDWIH, it seemed to me that a lot of downtown inventory was pulled this winter. my advice would be to stick to your budget. i actually got an apartment that way once, i lowballed and said, sorry this is as high is it's going to go because it's my budget, and i got the unit.

it's still early in the spring build up. i wouldn't jump because of a lack of inventory just yet.

I will say, though, that prices are going up. My sister bought a 2/1 condo in fall 2009, for $750 sq ft. (1,000 sq ft total) Now the comps in her building are all listing and selling at $1000+ per sq ft. Even a 1 bed closed for $150K more than she paid. How long ago was that? 15-18 months?

Crazy escalation.

She is not seeing a double dip.

Thanks Guys. I did see the 2nd floor unit and it's really dark and depressing. I assumed prices were going up but the 20% escalation is what confuses me. Especially since we're not really out of the woods. If someone could explain that level of escalation I'd be grateful.

I don't understand the escalation either.

I think it's suppressed seller greed as opposed to suppressed consumer demand.

But if you look at Urbandigs, (http://www.urbandigs.com/) they have a lot of useful info. For the amount you're about to spend, it's worth it to subscribe and check neighborhood trends, which seems to be what you're most concerned with.

^^I was just going to recommend Digs too!

Ali

regardless of what you think of your broker, advocate for yourself--it's too easy, on SE and Urban Digs--the UD acris feature simplifies--it'll take you 30 minutes to know all there is to know of what your broker seems to know so little--or maybe knows plenty of, but needs to do a deal

Thanks All. But is it accurate to say that prices are rising?

See Urbandigs, subscribers have that access.

No, it's accurate to say that some properties are selling for more, some for less, some for around the same, as the 2009 lows. many aren't selling at all. some are selling immediately.

This should help with the mechanics. (understanding the value of this place is not rocket science, and in your heart you know what an appropriate range is, I always give a range with explanations. But if someone decided to purchase with more heart than brain, well....)

A bidding strategy on a property like this needs to be well thought out; will the seller even consider $1.450 after such a short time on? IMHO; No. So do you waste your breath or be patient and let the market forces work? If what "we" are thinking (final price willing to pay) is to far from where "they" are, I usually advise some patient watching, this is if the property has been listed less than 30-45 days. If the property has languished for 2+ months, then we bid and lay out our case.

Either way, best of luck!
http://www.urbandigs.com/2009/07/valuing_manhattan_real_estate.html

Keith (broker)
http://ubivoletaudentunicornium.blogspot.com/

The factors for an uptick are there: Wall Streeters didn't lose their jobs, equities didn't tank, and now there's a new round of bonus money (even if it is thinly spread).

But I think we need three more weeks before we can call a pricing trend.

However, I reiterate that I am in direct competition with your broker, whoever he or she is, and from where I'm standing he or she seems to be doing a fine job.

ali r.
DG Neary Realty

"The factors for an uptick are there" = Buy now or be priced out of NYC forever

Ali G., you really must have read Lawerence Yun's playbook closely

DTDWIH -- I am not going to give you advice on bidding here, but I found your question and the responses this morning so interesting that I did a looong blog post dealing with some of the data questions you and others have raised. It will take you some time to read, but you may find it worthwhile.

I have no public opinion on that price, or on how your agent is doing, but I can endorse AR's description of the market: "it's accurate to say that some properties are selling for more, some for less, some for around the same, as the 2009 lows. many aren't selling at all. some are selling immediately."

http://www.realtown.com/sandymattingly/blog/the-process-buying-an-apartme/how-to-read-past-sale-data-one-flatiron-loft-laboratory/

Good luck.

Ali R...

as Ali G once said...

"Is you on crack or somethin'?"

My two cents:
1) Sellers bought at the ultimate low and probably feel they deserve to profit
2) They priced it in line with some comps in the area and below others
3) If the listing languishes, this price gives them room to chop about 10-15% off of the price and still break even after brokers commission
4) If it's any consolation, this flatiron neighbor appears to be doing the same thing on a smaller scale: http://streeteasy.com/nyc/sale/581181-coop-21-east-22nd-street-flatiron-new-york
5) If you buy the place, you should replace those floors - ugh

Thanks SMattingly. Interesting Blog! Apparently the air rights are not owned by building on the garage next door so there is a large risk of one of the best things about the apartment being compromised. That and the price would have me not sleeping at night. You all were very helpful...along with my broker looking into these things.

Sounds to me like you got vast majority of info on here rather than your broker. Shocking! And this cost you $20. You made right decision. Greedy, unrealistic, egotistical seller?.......GFY.

dtwih, all i can recommend here is that aboutready has the least ax to grind here is giving you good advice on comps and how to reconcile your questions. she is a great source of unbias info on the current state of play in the markets but ultimately you need to do what feels right for you after the appropriate due diligence. se insider will give you the access to good comps so ultimately that should drive your decision but my advice is to sprinkle that with ar expertise. will serve you well.

Thank you Rangersfan. I did notice people do seem like they're frustrated when i read some of the blogs....

Ill chime in..few things.

First, and foremost:

1. Look at the Contract Signed date, NOT the sale date. Go to ACRIS and look at the IMG doc to find the RP-5217 (I think thats the form) and it should show the actual contract signed date. You need to know this for a time adjustment> If it closed NOV 2009, it may have signed June-Aug 2009..and that period is right after what I called the bottom and the fear trades (early 2009 up to about April)

2. STAY IN YOUR BLDG for comps...if your broker goes outside, he is looking to ways to make the asking price work. Stay in your same line, minimize the variables! Try to keep adjustments to time adjustment, floor adjustment, and renovation adjustment only. If you have to do a size adjustment, fine, but make sure its the same kind of property..i.e., if its a 2br/2bth, look at other 2br/2bth that are around the same exposures as yours.

3. The TIME adjustment in your case if the deal was signed summer of 2009, in your price point (1-2m), I would say is between +8% to +12% or so. If it was signed in Feb-April 2009, Id up that to +10 to + 15% as fear trades in that period really defined the downturn we had. This price point was prob trading down 20-30% from peak when fear really was high for that small period of time. Now, that market is prob trading down around 12-18% or so from peak.

older post, but I liked this one:

http://www.urbandigs.com/2009/07/so_what_happened_since_lehman.html

I appreciate the input of the skilled observers here, but those on the sidelines are tracking sold comps. I'm getting a fresher sense of the market than that, by being out in it as properties are listed and move into contract.

You can disagree with my interpretation of my information, but it IS fresher information. That's one reason my clients hire me.

I see the latest bidding war in Tribeca as evidence that there's strong demand in the 2/2 space.

ali r.
DG Neary Realty

ali, you really think i don't follow new and current listings as well?

ali, i'm not accusing you of being a cheerleader. but every single damned up season (spring, post Labor Day), at the beginning, the same thing is said: i'm seeing strength, yada, yada, yada. then when comps show up some apartments surprise to the down, some to the up, and the remaining seem consistent with their submarket trend (which may be veering down or up).

at the big shops they have regular meetings with "experts" who regale the brokers with tales of market improvement, etc. and i think there is selection bias as well. just as i tend to focus more (although not exclusively, by any means) on the downside, brokers very much focus on the success stories. inventory is just truly starting to build, i'm in no hurry to call this season in either direction. i think you are much more so inclined.

DTDWIH - do you know if the garage still retains the air rights? They may not have sold them to this building, but it they sold to someone else you may be clear of danger on that front.

UD's realtime data on contract signings is way more interesting than the usual heartfelt agendized current-feel-of-the-market crap from some broker (rarely feels awful, that's for sure)

circa 2011, same and/or better info than any broker can provide is availble to anyone who wants to easily find it--and then, once found, the data can be reviewed objectively, without a broker-who-needs-to-get-deals-done's agenda/filter applied

and ar is spot on--go to UD and subscribe--contracts signed is on seasonal trend at lower levels than last year and higher than 2009

"You can disagree with my interpretation of my information, but it IS fresher information. That's one reason my clients hire me."

Yes, the info is Fresh as a Summers Eve and about as useful.

ar, I'm not denying that my occupation may bias me; that's why I let everyone know on every post that I'm an agent.

But I do get tired of the structural bias of this site, which is that the people who are in synch with the way I think hire me, do their transactions, and then move on,

while there's a perma-population of people who aren't in synch with the way I think who seem to enjoy sticking around and making personal attacks.

As I indicated above, I think the time to call pricing of this market is in three weeks, and it seems like a lot of the responses I got to that comment were not discussing pricing at all, but to immediately start talking about volume.

Thank you ar for being civilized, and at the beginning of March let's do a new thread and have a spirited debate on pricing.

ali r.
DG Neary Realty

shilleroooooo!!

buy a banner!!

how much does a banner cost on this site??

"But I do get tired of the structural bias of this site"

Not tired enough to continually type... "I am more than happy to help you with that purchase"

"which is that the people who are in synch with the way I think hire me, do their transactions, and then move on"

So I guess that people who are willing to overpay for a property are the ones in sync with you