Asking price dropped before signing contract

What neighborhood is this in?

You can certainly try but rest assured that if they have a competing offer at the same price, they are less likely to work with you. By lowering the price, they are just trying to any other offer around that price.

Apartment is in Riverdale

What neighborhood is this in?

And how quickly do you need to buy?
Riverdale is an aging demo. And plenty of older co-op stock. There will be more inventory.
I'm not saying be cavalier, but look at the supply and overlay it with how strongly and quickly you need to purchase.

Brooks2, are you blind or illiterate?

Hint, Brooks2: it's a yes-or-no question. You can't choose just one.

I dont have to buy it now but I like the apartment and want to buy it at the right price.

im not sure why a seller would mess with you like this. have you been slow to the contract?

You haven't signed... And you clearly are not the perfect buyer a seller would want since you are now second guessing yourself. So thats probay why the seller is trying to protect himself/herself. If I was seller I would not renogtiate and might even drop your contract if an equal app comes in between now and then. Then again he could also be using you as a back up...

>And you clearly are not the perfect buyer a seller would want since you are now second guessing yourself.

huh?

What neighborhood is thiis in?

im with gcondo in questioning why seller would mess around like this, with the exception of trying to expedite things and put pressure on u..its odd they would drop price right to your offer though. My first question would be when was Day 1 of due diligence that your atty received docs from sell side to do his work? how long has seller been waiting after verbal agreement on terms, for your atty to do his thing?

1 week? 2 weeks?

how do you know the seller dropped the price? maybe the broker was just stupid and changed the listing knowing the seller accepted lower - yup there are some idiots working out there...

I was looking at streeteasy and saw that the asking price was dropped about 12% from initial, now it's at the same level as my offer. They accepted my offer last Friday and dropped the price this Monday; today they sent the contract to my attorney. I'm annoyed that my broker didnt tell me about this and now she is rushing me to sign the contract.

Thats what my broker said:

I would not renegotiate this, it is rock bottom. What the seller's agent is doing is trying to find a back up buyer or getting another buyer who will pay more as it's now under priced. This is a strategy they are using to get a higher offer. It would be a good idea to have your attorney review the materials in a timely way and proceed. The long July 4th weekend is here and buyers could come in before the contract is sent out by the seller's attorney. They may or may not find another buyer who will pay more by a few thousand dollars. If they do, they will go with them as until the seller signs the contract they can accept another offer. The offering plan and financials should be with your attorney today.

Typical scare tactics used by typical salesman (ie, your broker). That being said, there is nothing technically WRONG with what he/she said -- indeed, what you just described could be perfectly accurate. Ultimately, you have no way of knowing for sure. Best thing to do is value the apartment for yourself -- if you think it's worth your offer and you'll be satisfied living in it at that price, go for it. Otherwise, if not, or if you feel uncomfortable with the situation as it now stands, perhaps rethink your offer. Remember though, your broker is ultimately working for, and being paid by, the seller.

Did you use a broker or did the seller's broker get you to sign a duel agency form? Once, we had a contract out and the broker called to say another contract had just been sent out to another buyer. I told him I had signed his duel agency form (which I didn't as I hate them) and accused him of being in breach of his duties to me. Of course broker argued he was the sellers agent. I pointed out to silly broker, he made me sign a form saying he also represented me and regardless of his duty to seller, playing me against another buyer is a violation of his duties to me. Anyway, we won the race but I made sure the broker knew he had been caught acting unethically. The lesson here is brokers are scum. They don't know the law and play fast and loose to get a deal.

If you want the apartment, move fast at the agreed price - otherwise walk away.

Wanderer nailed it. You want it, sign it.

You may have negotiating room. And there will be more inventory.

20K for a 300K priced unit is very different than 20K from a 1.5 mil unit.
How much are we talking about?

Tthe apartment is in 300K range. Thanks for all comments

Which brokerage has the listing?

A few years ago one of the big firms was accused of dropping asking prices to the contract prices, apparently to make their listing-discount statistics look better. I.e., "Look how well I can price!" (See SE's Find a Broker query, where listing-discount from initial and final ask is a factor.)

I don't remember which firm it was.

personally, I would walk away from a seller that acted on an assumption that I was a loser who negotiated in good faith and agreed to a price, who would then walk away.

but, maybe it was the selling broker's idea.

I would walk just to see if they come running back. If they didnt run back, I would buy someone who does not assume I am a dirtbag's apartment

---If they didnt run back, I would buy someone who does not assume I am a dirtbag's apartment---

Am I the only one who is completely baffled by the syntax of this sentence??

No you are not.

I dont understand it as well

Also, and brokers on the site please correct me if I'm wrong, but I understand some brokers will drop the ask before a sale so that their "discount to ask" stats look better when the sale is reported to data providers, streeteasy, etc. If they know what the closing price is going to be, by dropping pre-contract they can make it look like a sale at ask...

(Sorry for duplicate comment - I see that NWT also raised the same point)

NWT and Freebird are dead on. Seller did same with my purchase.

Though if the broker schedules an open house this weekend, you may give a little room for paranoia.

freebirdnyc -- i honestly dont think that is the agenda for such a move. Not sure why the broker will care what list disc is from last ask down the road when sale ultimately closes and gets published by acris. The check at closing is the goal.

Anyway, urbandigs is in final stages of site relaunch, manhattan charts/data relaunch, and we will have listing discount from orig ask trends. We engineered this metric to get that original ask accurate so the chart displayed better jives with whats happening out there. Trickier than we thought given all the data issues out there and weird things the broker status updates do in RLS

Noah, still would like to see a failed in contract rate.
I think it would be a great metric for a variety things.
Sure it's a lagging metric but it would still partially tighten up margin of error statistics for in contracts to closings.
Should be fairly easy to track these days too.

i dont think its lagging either, it would be realtime. So listing goes:

actve --> csgn state (pending) --> back to actv

Except there are data issues in rls where a listing goes actv--csgn--actv---csgn..so engineering would need to be done to make sure the listing is truly back on mkt, and not just an embedded data integrity issue. I dont miss those days in 2009-2010 when we cleansed the data!

yes, i agree fairly easy to track. I think SE has one dont they in their quarterly reports?

http://docs.streeteasy.com/market_reports/2013Q1_Report.pdf

broken contracts on page 5. Although with the scale of the other 2 items in that chart, its hard to read. Seems non-eventful though. Im sure this metric was biased in 2009-2010 for any new dev sales signed in 2007-2008 yet to close but gave the buyer an out in some way in the contract.

Oh awesome never seen it anywhere.
Yes it was biased in those years for a couple reasons, but it looks like a range of 5% to 6% failure rate.
If that is relatively steady yearly, what that now does is reduce the margin of error for "future" closings derived from in contracts info to less than 1% if you now deduct 5.5% from in contract figures.

true, but whats the wait period for defining a broken contract? if its less than 2-3 months, it might be misleading as the ultimate closing may file in later. I think if u look at a 90 day lag, your pretty much close to covered though.

Agreed 90 days probably covers 98% of in contracts.
That is also why I initially considered it a lagging metric.