14 East 93rd

Another very old listing that I find interesting, and very different then the Sutton Place one. I'd like to hear the board's view on this.

Seems that this has been the home of a stable and successful family for a long time. They bought for ~$3mm in the 1990s and it looks like they've renovated it sometime along the way. It's probably overdue for an updating, it has a small backyard, some people may want a rooftop area and they didn't restore the front stairs, but it's still a livable property. I suspect that whoever buys this is going to want to ~$1mm into updating it.

From the long time on the market and way overshooting on price, it seems to have created a "falling knife" dynamic where I think a buyer will struggle to make a move on this because property because the price just keeps dropping. I suspect they hope that the latest $2mm drop will stir up buyers.

How would people on this board view this? I suspect that these Seller never "have to" sell and can be as patient as they want. Would you keep this strategy of incremental drops, just hang tight with a hope that the market turns or a buyer just has to have this house, put in the money to renovate, etc?

It is still overpriced for that far up.

Also, it does not seem to need $1mm as all the systems such as elevator, hvac are in place. Bathroom pictures are missing. However, people buying at this price point may spend $1mm to redo and redecorate even if it were to be brand new reno. I bought my coop from some one wealthy who bought a high end new development and did a 6 months Reno project.

Could be less but I'm guessing ~$1mm from the pictures and it depends on the preference of the buyer. I would think that many buyers might want to dig out the basement and make it a more usable space (maybe a gym), put on a front stairway (and do the associated changes to the floorplan), recut the garden floor to make the front space more open, deal with the radiators that still seem to be there, new floors and lighting in various places, maybe a roof deck given how small the backyard is, put a bathroom on the parlor floor, etc. My point is that while it is a nice house, it's not going to be ready for many buyers to simply move in and enjoy.

Agreed that it is probably still overpriced at this level. I haven't done the research to at by how much. I think the interesting question is what the sellers should do about it. Their basis in it is probably still quite low, even with the renovations they have done. I personally think that the decision on a house like this depends on where you place for bets for long-term values in Manhattan real estate given the dynamics around new development, different desires/needs, taxes, etc. If you believe we are in a soft period that snaps back, maybe they should rent it for the next several years.

It depends on the need to sell. Many rich people leave their properties unused for a long time. Depends on the alternative uses of capital. If you are worth $50mm and already reasonably invested, you do not care about making a decision even though that is not economically rationale. Each case is unique at this price level.

For someone wanting to do all the things you mention, this is not the right place. You will be much better off looking for a gut in a nicer location.

Good points TeamM but I think that's simply what rich people do, spend a lot of money to personalize their homes even if not needed. I would not think any renovation costs would be deducted from value except for the bathrooms where no pictures say a thousand words. And there are over 6 of those so maybe that's $1,000,000 right there. I don't follow the townhouse market much anymore but this is a 20 footer which is comparatively rare. Also, its got an elevator that goes from the basement to the fifth floor which is awesome. Back yard is maybe a little boring.

I did some research and owner is a successful banker with a large estate in Fairfield County who is at or near retirement age. You never know when someone becomes desperate for money but this does not appear to be the case. Very low mortgage on the townhouse so perhaps lots of equity built-up. But who knows?

But for the wealthy, it is often a matter of personal pride to say what you sold your house for rather than a need to maximize the amount. Same with renovations as few rich people buy a home and not spend a ton of money to personalize it.

Ximon - fair point that it might be a matter of pride, but if its a sophisticated seller then holding out for the impossible isn't going to fulfill that goal.

I hadn't really looked at comps when posting this listing. I just thought it was interesting because of how long it had been on the market + the pricing drops. I just spent a few minutes poking around and while I think it's really hard to figure out comps on a house like that, I now feel stronger that 300 is right that it's still quite overpriced. Looking something like 63 East 82nd, which sold for $13.25 a few months ago (better neighborhood, better street, bigger house, better condition, etc.), it's a head scratcher.

Assuming pride doesn't play into it, what would your strategy be as a seller?

TeamM, I really don't think you can take pride out of the equation in cases where neither price nor timing is necessarily an issue. Obviously, people put property on the market for a reason. In the case of 14E93 let's assume it's for simply for estate planning purposes.

I would love to hear from a townhouse expert but 63E82 indeed appears superior to to 14E93 especially its location. It's also a 20 footer with an elevator but it's got an extra floor (or two if cellar is not included in listed SF).

But take a look at the price history of 63E82. It was listed in Sept. 2016 for $23.75 million and sold 5.5 months later for $13.25 milion, a 44% drop. Also, it was offered post-2008 for $25 million and sold in 2010 for $13.9 million, another 44% drop. So it seems there is little stigma for aspirational pricing. If 14E93 sells for a 10% discount to current asking price, say $10 million, it would represent a 45% drop from original asking. Again, I am not a townhouse expert but I would recommend that seller hold out for a minimum of $10 million which is a very prideful number.

Interesting article on 63E82 which includes a somewhat distressed ownership history:
https://ny.curbed.com/2016/9/16/12941620/upper-east-side-scandalous-past-townhouse-for-sale

Fair that maybe pride can't be removed from it. I don't know that $10mm will be a feasible number within the next few years for that house.

I might be misreading the sales history, but I think that 63E82nd bounced among brokers for a couple years (with a lot of price cuts) before selling earlier in 2018 for that amount.

I think $10mm is the right price for that far up. That includes a $2mm premium for the park block. They may take it if offered. I do not think it will trade at $7mm unless there is 2009 again and the seller has to sell. It is a little overbuilt (say 5-10 feet) as well in terms of depth leaving less of a back yard. Fundamental issue is that there is oversupply in that $ segment and while the taxes for this one are not in the listing, townhouse taxes in Manhattan are not low any more. In the 60s or 70s it would be $ 15mm or more. Some one may even pay $20mm. Village could be $15mm too but not higher. Who wants to live on 93rd for that price?

Ys 300. Location is everything in this market - Not sure how to adjust for Carnegie Hill vs. UES but it has to be 10% or more park block or not. But I also think the SF may exclude the basement level which is fair but not always done.

Agree with 300 that $7mm seems low. Tough to tell if $10mm is the right number because there's not enough volume in comparable properties. Looks like a townhouse on the same block with similar width, slightly closer to the park and maybe better condition (really tough to tell - 13E93 might have a better kitchen) but maybe no basement (tough to tell) and no elevator sold for $8.9mm last year.

In many ways I think the most interesting question is one that Ximon is posing - is the seller really motivated for $$ maximization (considered holistically, including TMV, etc.) or does the headline price play a factor in it that would cause the seller to allow it to languish for so long? And to what degree does the dynamic of broker competition for listings play into it. That sort of pontification is why I find some of these multi-year listings so interesting, particularly when it's properties like this that could presumably be sold if the price was adjusted within reason (i.e., if they put this property at $8mm, it would probably sell fairly quickly) - it's a less interesting conversation for the extremely expensive properties for all sorts of reasons (i.e., the listing itself can be a marketing exercise).

TeamM, Elevator mean that highly likely there is no structure or mechanical work - hvac, plumbing updates, electrical updates - and the property is in a significantly better condition overall. Worth at least $500k if not $1mm to some one who does not want to rip out every thing and start over.

300 - maybe that's right. I'm just guessing based upon pics. My sense is that $10mm still feels high compared to what else is available at that price, but the townhouse market is small.

Regardless, I still find the listing itself and its history interesting. It's been on the market for a bit over 3 years, with the price dropping about $2mm each year. At this trend it will be at ~$10mm next year...

I think part of the issue is that the house doesn't fit the neighborhood. what I mean is that many of the houses off of 5th Avenue, going down all the way into the 60s are built "Mansion Style" in that they are on wider lots (this one is only 20') and built almost full to the lot with no rear yards. So I think as such most of the people who are looking to be in a house off Fifth Avenue are looking for that style / size house and this one doesn't fit in with that.