FP's decoration discussion

Aww, Nada, you're the best!

I saw this listing:

https://streeteasy.com/building/34-west-13-street-new_york/4th-fl
and , in addition to thinking "I love the molded Eames chairs around the dining table in the different colors, I have to steal that" I was thinking, "wow, some people must have redecorated during the Pandemic."

and indeed, they did, a bit. Here's that loft a year ago:
https://www.architecturaldigest.com/story/step-inside-this-eclectic-manhattan-loft

and here it is in a rawer state, when, presumably, the sellers bought it:
https://streeteasy.com/building/34-west-13-street-new_york/fl-4

Bottom line: I dig their taste.

ali r.
{upstairs realty}

I will say that the bathroom is big let down at this price point.

due to cheap looking small white tiles with dark/dirty grout.

@ 300-- Personally I prefer using dark grout with white bathroom tiles. Love the contrast and the grout doesn't show the inevitable water staining. While I am not a fan of this space's particular 'mod' aesthetic, I'll take traditional white hex and subway tiles with dark grout rather than over-designed 'designer' finishes any day.

Ambitious pricing

I like mid-century furniture, mostly vintage. Although when we renovated our house recently and redecorated we did mix in a few new pieces. In my opinion this is just too much...

Keith, it is A LOT but I admire the strut.

Just dissecting for fun. Reno itself is nice except for master bath cheapish bathroom tiles. The decor is very nice except for the clutter of artwork. Couch with blue accent pillows and matching shades are very nice. The light fixture on top of dining table is adding to the clutter due to too many support wires. If you thin out the artwork or replace it with fewer bigger pieces, it will appeal to larger percentage of gawkers.

Ali will kill me when she sees me next but I will take the risk and continue criticism as she is too nice. What is with the love of white subways tiles in the huge kitchen backsplash too? I wouldn’t use the same cheap material in bathroom and kitchen and ask for $4.8mm.

$4.95m

I can get behind the vibe on this one. When I first moved to NYC, I shared a loft of this sort with a friend for a couple of months. Literally on the corner two blocks north of the corner of where I am now. Railroad, exposed everything, whimsical, funky, and fun. Old NYC. This apt reminds me of that, gussied up of course.

What I have a hard time doing, however, is getting my mind around who will pay for it. Putting 30% down and financing at 3% gets you to a $20K/mo monthly nut. Alternatively, cost of ownership, using 3% for blended cost of capital, works out to ~$80 ppsf/yr. That’s a lot of lolly for a funky railroad apt with exposed pipes. Especially when I compare it to what I’m getting for my ~$80 ppsf/yr.

I like the art collection (Albers, Warhol, Indiana, Haring, Lichtenstein, etc.), and they did a good job with the layout. Some of the finishes aren't my taste, and the color schemes are a little matchy-matchy, but it's a place that looks comfortable and fun. I don't mind a crowded wall if the artwork is interesting.

Nada, People are willing to pay the moment it is in the village. Rental choices for large foot-prints are limited in the village.

https://streeteasy.com/building/27-great-jones-street-new_york/phw

https://streeteasy.com/building/37-east-12-street-new_york/6

So you can get something decent for $20k in the village but for people who do not want to move there may be an ownership premium of 10%-20% in this segment of the market.

300, I point out that we are overdue to see each other -- I have been in hiding from the cold, frankly -- and I won't kill you when we do.

For the broader world -- I think for "posh-slash-$20K/month" in GV to heat up is going to need FB and Google, whatever they call them now, to RTO, and maybe for Broadway to feel it's up and can stay up.

Those aren't the only possible inhabitants, but that catches a swath of the usual suspects, I think.

(Side point: A couple of weeks ago I did talk to a Googler who was going back, but they were a subsidiary-campus person, and so wanted to live further downtown.)

13th St between 5th and 6th has long been the red headed stepchild of Greenwich Village.

30, What will it sell for? I say $4.2-4.5mm.

300, people are welcome to blow $500K/yr pre-tax income on housing in any random manner they wish AFAIK (and then complain about how expensive it is to get by, of course). Mostly, I’m trying to say that at ~$2000 ppsf, the market for quirky, semi-finished railroad apts is slim no matter how interesting the current owner has furnished it.

Even the Village has its limits. The 2017 sale on this tried $2000 ppsf for raw space, but that fell flat on its face. The 12th St apt fave a try at $3000 ppsf for finishes mimicking ultra-lux, but $2000 ppsf is about all the market was willing to bear. And the Noho loft also traded at $2000 ppsf, as finished / polished space. I’m not sure the market is going to be there at that price for semi-finished, quirky space with exposed sprinklers & pipes, painted brick, funky bathroom & kitchen finishes, etc.

(N.B.: if an apt has sat at $20K/mo rent over the last 6 months, in as hot a rental market as I’ve ever seen with inventory as low as it’s ever been this past decade, then I’m guess long that’s way off-market. A lot of apts I considered highly-priced seemed to disappear in no time at all.)

Back to the furnishing, I generally can get behind it all except the dining chairs. Color mix is good / fun, but I’ve always had a hard time getting behind plastic dining chairs. A little because they feel hard and cold, but mostly because they are plasticky and therefore look “cheap” (which is simply a material bias I possess, but there it is). Once you pass the age of two, you deserve chairs with cushioning and cloth in my book. Unless you’re a sloppy eater who has trouble reliably moving food from plate to mouth, in which case I guess plastic is better.

Nada, While the sprinklers, and exposed bricks and pipes are plus for many buyers in a loft, the finishes in the 13th street place are clearly on the low-end side (did I mention those cheap subway tiles as an example?). That is why I am curious what this will sell for. Any thoughts? I am thinking $1500 per sq ft is pretty much the floor. After all, it does have central ac, and renovated everything. Technically, rail road apartment is when you have to go through a bedroom to go to another bedroom. But this one works well as a 2 bedroom even though the proportions are little off.

I haven't seen it in person yet -- I take your point about the baths, and the kitchen also doesn't look particularly opulent -- but windows on all four sides are no small thing, and it might be smashing in person. For my clients it would come down to how easy it is to add a third bedroom -- surprised there's not an "alternate floor plan" being shown.

You cut master into two rooms.

The chances to have a proper third bedroom have been ruined as it would have been where the kitchen is.

The angled part of the 'primary suite' becomes a bathroom, the adjacent current bath becomes a bedroom. Or, as 300 mentioned, you turn the kitchen into the 3rd br. In either case, lots of plumbing to move. On the plus side, you'll be able to throw out the freestanding soaking tub thing.

This is a unit, that, for all it's size, is only going to retain it's loft vibe and cool factor if it stays a 2 BR.

At $4mm plus, it will remain a 2 bedroom. There are a lot of buyers in the village who want a large space but do not need 3 bedrooms.

300--what do you have against subway tiles? They may be 'cheap' but they're classic and timeless and won't age out within a year or two like trendier options. There's a reason they've been used for the past 100 years or so and still look fresh today. Just my 2 cents. :-)

I have nothing against subway tiles for a lower end place of $1000-1200 sq ft or in a basic doorman rental, but if I am paying $4mm plus, I expect marble tiles 12x24 (which will cost $15 plus plus retail) or large format high quality porcelain tiles ($8 plus per sq ft retail) vs $1.5/2 per sq. ft subway tiles which also do not need much skill to install. The whole goal is to minimize grout lines. If I am paying $7-8mm+, I expect slab marble in the marble bath.

The same philosophy can be extended to floors. 2 3/4 strip floors will not fly in a $4mm $1500+ per sq ft place. This one has some nice ones which look to be 6-7" wide.

I have to agree with 300 here, as much as I also think subway tile is classic, it has its limitations. We put it in our daughter's bathroom, but went with marble in the guest bathroom and then small marble herringbone pattern in our master bathroom. And we ain't fancy folk, however, my wife has very good taste.

Specific price points definitely dictate material expectations.

I have to agree with 300 here, as much as I also think subway tile is classic, it has its limitations. We put it in our daughter's bathroom, but went with marble in the guest bathroom and then small marble herringbone pattern in our master bathroom. And we ain't fancy folk, however, my wife has very good taste.

Specific price points definitely dictate material expectations.

300, I’m not sure what it’ll go for. This is outside my wheelhouse, and you’d know better.

I’ll say this, though. The owner bought the place for $2.66M in 2017. Since then, prices are down ~10% according to SE’s same-home resales index. I don’t think the Village has been immune. The owner is effectively asking for a $2.5M markup, about $900 ppsf, for the renovation. That’s a tall order for exposed ductwork w/ gaps, painted brick, subway tiles, IKEA kitchen cabinetry, and a curtain in place of an elevator door.

At this price point, buyer is probably not someone who wants to change over every finish, or split the unit into two as the other floors have been (I'm sure at a different price point 300 would have thought about it). Buyer is probably also not someone who wants to move plumbing to create a third bedroom -- they are working so hard to make their millions and who has the time? -- so we are indeed left with a narrow slice of loft buyers.

However, for those shoppers, it's giant and column-free, and has Central Air now. It does beg questions of details (how many zones?) that aren't in the listing, and I think we all fear that if the details aren't set out, then they're not boastable. But it's possible that they are, and that someone else with an art collection will appreciate the lighting upgrades.

I guess I'm working my way around to saying no, the reno is not worth $900/sf, but I hypothesize that the raw space value has gone up and not down -- the market is a river with many currents -- and that the reno is worth something.

Nada, I think they got a good deal going in. Say $200k. Plus $500 per sq ft. $1.4mm - includes carry plus trouble. It also gets to my $4.2-$4.5 estimate. Village market for this type of place is pretty hot as there are very few of them.

FP, I agree with the potential buyer here taking the apt as-is. People who want to renovate and do things their way tend to start with a blank slate. Sometimes you see people buy a place in perfectly fine condition and renovate their way anyway, extra cost be damned. But this space doesn't strike me as attracting that sort of buyer.

300, why do you think they got a good deal going in at $2.66M / the "right" price should have been $2.86M? The place was on the market for 2 years. This included a full 4 months at $2.9M with no takers. After they dropped it to $2.6M, (presumably) competitive bidding led to $2.66M. The market was at its peak in 2017, and whatever you think about the rarity of such space in the Village in 2022, I'm guessing it was the same in 2017.

#Kylewest

Right up his alley. Sorely missed.

Nada, Previous un-renovated sale was destroyed by the initial overpricing of $5mm plus.

https://streeteasy.com/building/34-west-13-street-new_york/4th-floor

I was tracking it for fun that time.

You destroy the listing by overpricing it initially as people start to think that there must be a lot of issues.

Do the Warhols come with the apartment? I think it is way way overpriced, but no clues what it could sell for.

Nope. But if you pay me the difference between $4.95M and where it closes, I’ll come over and hang a soup can from the ceiling.

So what goes thru people's heads when they buy a place, and then mark it up like this within 2-3 years? Otherwise reasonable people, clearly smart and successful.

Are you saying that’s what happened here? I don’t see it that way on this one. I think a significant mark-up is justified, because they bought it as essentially raw space and are selling it in renovated form. Granted, the aesthetic they went for was off the beaten path (epitome of 1990’s loft-iness, I’ll call it) and therefore less costly than renovations more typically undertaken these days. But a renovation nevertheless.

If I were to pick between the round numbers of $3M, $4M, or $5M, I think $4M is probably the right price. I don’t know enough to argue between $4M and the $4.2M that was in 300’s range, but this seems more like a case of typical overpricing that a few months / chops / negotiations will deal with.

The $5M for it as raw space, now that’s another matter altogether…

Why and how people overprice?
1. Brokers are competing for listing. So a broker may suggest a high price to get the listing.
2. Owners may see a comparable sale at $100 and think that their property is better by 10%, where as in reality it be worse by 5%.
3. There are people with a lot of money (think bit-coin, tech company sale, really fat bonus of say $5mm as they did a deal, trust fund etc) for who overpayment of $500k (10-20% may not mean much. So who knows that one of these buyers may like it. We see over and under valuation of individual stocks in stock market all the time relative to traditional metrics.
4. We on this board may be wrong about overpricing of this listing.

I had some one buy in my building recently with 5x++ liquid net worth of purchase price - all 100% self-earned money over time without windfalls and under the age of 50. Not sure whether 5-10% difference mattered to that person as long as they like the place and location (this is where limited supply in the village comes into play). Weekly fluctuations in their stock portfolio are probably more than that.

I'll take a stab at how this one might have worked:

1) I paid $2.66M for the space.
2) I paid $1M for the renovation.
3) I paid $0.5M to carry the property empty for ~2 years.
4) I'll pay $0.4M in transaction costs.
5) I should get $0.5M for my time and impeccable taste.

Add that up, and you get to $4.96M.

In the sideways market of the past ~15 years, I've anecdotally seen a lot of properties priced at some notion of "Well, at least I won't lose money" rather than the market. I don't really blame the brokers for having a tough time telling the clients "Well, the market couldn't give a rat's ass about whether or not you're going to lose money."

FWIW, I think a "professional" would have got it done as follows:

1) Pay $2.25M for the raw space.
2) Spend $0.75M for a better renovation. I.e., cheaper sourcing but better quality / finishes / etc.
3) Get it done in a fraction of the time => $0.25M carry costs.
4) Insider / low-comm pricing => $0.25M in transaction costs.
5) Get paid $0.5M for my time, capital, and understanding of conventional taste.

Adds up to $4M. List at $4.5M in hopes of doing better, maybe drop to $4.25M. Hit the bid at $4M and call it day. Move onto the next project.

Not sure a "professional" would have been able to get a better price that the current seller paid.

Perhaps buying commission savings on purchase.

I agree, a professional wouldn't have gotten a better price on this one. However, a professional would only take on projects where they would have gotten a better price.

I'm mostly saying a professional is sensitive to what the market wants and will bear. As such, they will find a project with a better entry price (by $0.4M in my example) and be more efficient w.r.t. renovation costs ($0.25M), carry costs ($0.25M), and transaction costs ($0.15M). They'll get the job done cheaper/faster than a civilian And on this one, they'd have really step it up a few notches on finishes (spend another $0.75M, say) and charge accordingly (another $1M, say), because that's where the market is.

The civilian may be adding up costs similarly to determine a sales price, but the lack of efficiency / cost sensitivity leads to an above market final price. They think "Well, if a buyer did everything I did, that's what it'd end up costing them" but forget that the market is the market, and professionals can/will do it more efficiently than randos.

Think about it -- nearly 2 years to do that renovation??? I've watched an 800' tower with an initial $700M projected sellout go from nothing to foundation to tower to living residents in ~2.5 years. All that from a base floorplate not much bigger than this apt. The market doesn't care about someone's weeks-long dithering over the exact shade of white for subway tiles.

Ha. You nailed it about how it is so inefficient for individuals to do a gut reno.

"The market doesn't care about someone's weeks-long dithering over the exact shade of white for subway tiles."

Here is an example of bathroom finishes more suited to $4mm plus price range.

https://streeteasy.com/building/49-chambers/8e

300, do you think your paid market-ish or above-market like this one at $4.95m?

300, do you think your *neighbor* paid market-ish or above-market like this one at $4.95m?

Here is the listing they probably used for comp but it has much better finishes.
https://streeteasy.com/building/54-east-11-street-new_york/3

Nada, About my neighbor, I will text you.

On 54 East 11th, if you want a finished 3 bed'ish loft space in the Village, you will pay through your nose. Chelsea is at 25% discount but some people want these lofts and in the village where there are so few of them.

So $550k price cut in 34 West 13th Street listing.

Will history repeat?

Thanks for the update, 300. I like how the broker copy starts on the listing:

“Everyone needs a fantasy.”

Yes, they do. 300, are you still guessing a $4.2M - $4.5M sale on this one?

I think closer to the lower end of my range given the price cut which must be based on market feedback.

Did I mention Jaws 4 floor tiles in the kitchen before?

Heh. You mentioned the kitchen a couple of times, but the Jaws 4 reference is new.

On pricing, they flubbed it. At their initial listing date, jumbo mortgages (using Optimal Blue) were at 3.5% and obviously lagging / rising toward conforming rates. A $4.4M ask would have garnered a stock-/bonus-flush offer and rate lock in a week or two.

Now they are dealing with buyers facing 5% and/or who smell blood in the water. (It’s Shark Week on SE, no?)

Ha

I think it should be a good week or two for Keith shark buyers with a lot of cash who didn’t want to be in bidding wars.

>>The toilet is set up as a Warholian installation, with a Polaroid camera tempting guests to take a bathroom selfie. <<

Oy vey.

Pine cone, What would you change in the reno (not furnishing) if you had $50k budget? I would tile over half the walls in master bath with light-mid gray marble in 12x24 or bigger, get nice quartz slab backsplash in kitchen and replace the kitchen floor tiles to just light gray porcelain.

I think the problem with that concept is for most people a unit either needs a renovation or it doesn't. If they think it does almost no architect/designer/contractor is going to come in and recommend spending $50k even if that is exactly what is called for.

If you think your average buyer can see that, explain why brokers are all telling sellers to spend $50k on "staging." That industry is one of the biggest wastes of money in Real Estate. I'm not saying that it doesn't "work" in terms of getting buyers interested more quickly and at higher prices. I'm saying someone is paying a lot of money for something which doesn't improve the piece one lick, doesn't come with the sale, etc. It just proves how very little imagination the general pool of buyers has and how little sense goes into a lot of purchases.

30, What you say is generally correct about buyers seeing this as a project or a non-project. I was just trying to have some entertainment which is not trashing the property and its listing price. Let us play. What would you change?

Most New York City apartments are pretty unspectacular in their natural state. Staging can create an illusion of fabulousness.

I'm sure most brokers have had this experience; walk into one apartment with great furniture, artwork and decorative accents, the buyer falls in love (with the decor), is blinded to many of the shortcomings of the actual home.

Walk into another home with the same buyers, I see a much better layout, more space overall better value and potential. The buyers don't have that wow moment, want to talk about the other unit : )

Agree with you 30 years but as you also said , there are some without enough imagination and one buyer is all you need.

>>>Pine cone, What would you change in the reno (not furnishing) if you had $50k budget? I would tile over half the walls in master bath with light-mid gray marble in 12x24 or bigger, get nice quartz slab backsplash in kitchen and replace the kitchen floor tiles to just light gray porcelain.<<<<

I think you'd need more than 50k for what you describe. Keep in mind changing out the kitchen floor tiles may require ripping up and replacing other elements in the kitchen. Bathrooms you'd need to rip out any tiling you wanted to replace with the marble, which might also turn that into a larger job than one would want.

But yeah, I am with you. The kitchen floor tiles are headache-inducing and the bathrooms look like grid graph paper. Not relaxing in the least.

Agreed Keith, just yesterday I had to talk a buyer (who had seen some wonderful staging) down by explaining that the representational staging desk in the property was the size of a post-it, and therefore wasn't big enough to fit their actual computer setup, and THE ENTIRE POINT was more room to WFH. It's tough though; people like flash.
ali r.
{upstairs realty}

Now $3.9mm. They missed the hot early part of the year by aspirational pricing.

28 days till broker change and price increase.

Yeah, they flubbed it. They’ve now dropped the price by 20% to the ballpark of where I thought was appropriate, but it would have worked much better before interest rates shot up 50%.

300, what is your updated estimate of sale price?

It is close to fair value now. But now it is tainted due to initial mispricing.