Moved to post because I saw an example of a Corcoran agent's doing this at Worldwide Plaza -- moving the price of an existing apartment UP instead of DOWN. I can't speak for him, but I did this too, downtown. I did it (after consultation with my seller) for two reasons: 1) I feel in this market, to an absolutely ridiculous extent, buyers are anchoring off listing price. So many buyers and buyers'... [more]
Moved to post because I saw an example of a Corcoran agent's doing this at Worldwide Plaza -- moving the price of an existing apartment UP instead of DOWN.
I can't speak for him, but I did this too, downtown. I did it (after consultation with my seller) for two reasons:
1) I feel in this market, to an absolutely ridiculous extent, buyers are anchoring off listing price. So many buyers and buyers' agents were saying to me, "you've listed at a fair price compared to last year/everything else out there, but c'mon, I want a little discount" that it seemed the way to play the psychology was to raise the anchor price and then be able to offer wiggle room.
2) As new devs have mounting C of O problems, existing inventory is worth more because you know what? You can move into it in 30 days.
I'd be interested to see more examples of this, and I'm happy to answer buyer questions that are phrased in a non-abusive manner.
ali r.
{downtown broker}
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Response by october
about 18 years ago
Posts: 145
Member since: Mar 2008
I've seen this done before. I'd be curious to see how this turns out. As a buyer - I have a few general comments - (1) if you put it up by too much you might just cut yourself out from search-engine searches under a certain price; (2) buyers who see prices going up in this market don't believe it and think that you are playing games; and (3) when buyers look at comps. your apt. is going to stick out like a sore thumb. Thanks for the report.
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Response by Trompiloco
about 18 years ago
Posts: 585
Member since: Jul 2008
I agree with October. I think in this market, especially if the listing has been listed for more than 30 days, any arrow pointing up looks absurd for the informed buyer. Is like: what, really, a bidding war? hahaha.
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Response by eric_cartman
about 18 years ago
Posts: 300
Member since: Jun 2007
IN addition to what has been said here, one additional risk of moving it up will be, that if you go up, and don't have much interest, going down will make you look like you are playing games. If I remember right, there's one particular broker who moves price up and down $5K every other week to refresh in search results - this is just the kind of game playing serious buyers dislike most.
The best strategy, in my opinion, is to price slightly below market, and hope for a bidding war. Yes, this happens if priced low enough, even in this market.
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Response by front_porch
about 18 years ago
Posts: 5325
Member since: Mar 2008
cartman -- we did initially follow your strategy. This tactic is being used a lot downtown, most recently successfully by another broker on a Prince Street property.
We too, got our bidding war. Unfortunately, that contract did not get signed, and then our second-place bidders' circumstances changed.
However, in my seller's mind, the bidding war had proved some valuable information as to the "true" price of the apartment. The question was then how to signal buyers what we thought that 'clearance' price should be. There's a certain amount of lowball noise out in this market, and we wanted to filter that out. (We just turned down an under-asking price offer three weeks ago).
We're not talking a $5K movement -- I'm not that kind of "gaming the system" broker. Also, in some systems that are not StreetEasy, any attempt to move price, whether up or down, jams up the system, so adjusting the price isn't something I would ever do lightly.
Am still getting interest at the new price (which is under an NY Times breakpoint). Will let you all know how the saga turns out.
ali r.
{downtown broker}
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Response by alpine292
about 18 years ago
Posts: 2771
Member since: Jun 2008
An old friend of mine is selling on the LES. When she dumped her agent and got one from Elliman, they raised the price. Guess what? When the apartment did not sell, they lowered it right back to where it originally was!
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Response by starfish
about 18 years ago
Posts: 249
Member since: Jul 2007
We live next to an UWS condo conversion of a pre-war building that just increased prices about 20% on the 3 remaining apartments listed even though they have been on the market for at least a few months. I saw all three a month ago and thought they were under-priced, but not by 20%. Do developers increase prices after they attain enough sold units to convert or something?
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Response by alpine292
about 18 years ago
Posts: 2771
Member since: Jun 2008
Most of the time, anytime you raise the price, you will end up lowering it right back to where it was in the first place. Unless you accidentally significantly underpriced your apartment or your apartment is really special, raising the price is not going to work. And if the apartment is underpriced, a bidding war should break out so there should be no need to raise the price.
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Response by billshiers
about 18 years ago
Posts: 77
Member since: Aug 2007
I understand where front porch is coming from because I do think a lot of buyers (such as myself) currently think that the actual price of any property is around 10% below the listing price (regardless of the fairness of the listing price). There is also the accompanying belief though that NYC real estate is currently a stagnant or depreciating asset so I think a price increase in this market generally causes a buyer to think "Really? Good luck with that."
I've seen this done before. I'd be curious to see how this turns out. As a buyer - I have a few general comments - (1) if you put it up by too much you might just cut yourself out from search-engine searches under a certain price; (2) buyers who see prices going up in this market don't believe it and think that you are playing games; and (3) when buyers look at comps. your apt. is going to stick out like a sore thumb. Thanks for the report.
I agree with October. I think in this market, especially if the listing has been listed for more than 30 days, any arrow pointing up looks absurd for the informed buyer. Is like: what, really, a bidding war? hahaha.
IN addition to what has been said here, one additional risk of moving it up will be, that if you go up, and don't have much interest, going down will make you look like you are playing games. If I remember right, there's one particular broker who moves price up and down $5K every other week to refresh in search results - this is just the kind of game playing serious buyers dislike most.
The best strategy, in my opinion, is to price slightly below market, and hope for a bidding war. Yes, this happens if priced low enough, even in this market.
cartman -- we did initially follow your strategy. This tactic is being used a lot downtown, most recently successfully by another broker on a Prince Street property.
We too, got our bidding war. Unfortunately, that contract did not get signed, and then our second-place bidders' circumstances changed.
However, in my seller's mind, the bidding war had proved some valuable information as to the "true" price of the apartment. The question was then how to signal buyers what we thought that 'clearance' price should be. There's a certain amount of lowball noise out in this market, and we wanted to filter that out. (We just turned down an under-asking price offer three weeks ago).
We're not talking a $5K movement -- I'm not that kind of "gaming the system" broker. Also, in some systems that are not StreetEasy, any attempt to move price, whether up or down, jams up the system, so adjusting the price isn't something I would ever do lightly.
Am still getting interest at the new price (which is under an NY Times breakpoint). Will let you all know how the saga turns out.
ali r.
{downtown broker}
An old friend of mine is selling on the LES. When she dumped her agent and got one from Elliman, they raised the price. Guess what? When the apartment did not sell, they lowered it right back to where it originally was!
We live next to an UWS condo conversion of a pre-war building that just increased prices about 20% on the 3 remaining apartments listed even though they have been on the market for at least a few months. I saw all three a month ago and thought they were under-priced, but not by 20%. Do developers increase prices after they attain enough sold units to convert or something?
Most of the time, anytime you raise the price, you will end up lowering it right back to where it was in the first place. Unless you accidentally significantly underpriced your apartment or your apartment is really special, raising the price is not going to work. And if the apartment is underpriced, a bidding war should break out so there should be no need to raise the price.
I understand where front porch is coming from because I do think a lot of buyers (such as myself) currently think that the actual price of any property is around 10% below the listing price (regardless of the fairness of the listing price). There is also the accompanying belief though that NYC real estate is currently a stagnant or depreciating asset so I think a price increase in this market generally causes a buyer to think "Really? Good luck with that."