Better Negotiating / new develop or Resale?

meant best bet for negotiating...

My experience leads me to believe that new developments are more negotiable. A fellow broker in my office just negotiated a deal on a 1 bed in a new dev for $585K when the asking price was $735K. Developer is also playing all the closing costs up to 5%. With re-sales, it's you & your luck finding a seller that "must" sell for the reasons you mentioned.
sanzaroot@gmail.com

@soph Interesting. I'd have thought the opposite since a highly discounted sale in a new dev. has a greater potential to impact the sales price of the other units in the building...

soph what happened to your elliman e-mail :)

The published prices for new development are likely to have been set circa 2007. A 20-25% discount is therefore not remarkable - it probably just reflects market deterioration. No disrespect, Sophia, but it's possible that a brain-damaged ferret could have negotiated the same deal as your colleague.

Asking prices for resales are all over the map. A wildly overpriced listing with a distressed seller may wind up negotiating 50% off the ask, but that won't necessarily make it a better deal than a property that's priced sensibly to begin with.

In short, ap2492, your question is unanswerable. I suggest that you pay very little attention to asking prices, let alone the possible degree of negotiability built into them.

west81, what do you think average housing stock (of the stuff you follow) is now selling for on a per sq ft basis? not ask, but actual sales. i know that individual properties will vary tremendously on a number of factors, but i'm more asking your perception of the average and how much it has fallen.

it also depends on the particular development, a friend recently had a client put in an offer 20-35% because that was the trend on a new development in the UES and the offer was turned down. The developer said he knew his product well, he financed the project, and he is not going to give it away half off. Really, as agents that's why we have to be careful to promise people things in ways in which we do not really know for sure, that's what creates this inflated sense of entitlement. I am not saying that there are not developers out there either in financial turmoil and need to do whatever they can to sell in our current climate, or that they have a few units left and just want to move on. You never know truly.

I wouldn't want to risk buying into a 50% sold building in this climate. Very likely the developer will convert it to rentals, and that is NOT good for owners, especially at such a high ratio.

Just my $0.02.

I should clarify that sentence: Very likely the developer will convert the remaining units to rentals.

I agree with bmw that it is very building-by-building with new developments; we have seen some buildings tell us that they have up to 20% negotiability off list and other buildings tell new purchases who offered 8%-9% off list to take a hike. In general, remember the developer has to pay off his construction loan, so his hands may be tied by his loan agreeement.

West81st is also right that you shouldn't use asking prices to anchor anything. I have not seen this mythical 50% off sale that you mention, but you're right as rain that some things are priced expecting that you'll come in 15-20% under and some things are priced much closer to actual clearance price.

ali r.
{downtown broker}

Special_K: With my finger in the air, I'd say "reasonably nice" is trading around 900 psf, "really nice" is around 1100, and "not so nice" is getting down into the 750 range. "Really, really nice" and "Special" are so thinly traded that I can't even venture a guess.

i don't know about the rentals. Really depends on the developer and his financial condition.
First, the rental rate will be so high, because if the Developer has a mortgage due, his payment is based off oonstruction loan, not as an investment property (who knows if he can even get that financing), the banks will call the note due, put that aside, think of his costs, with the HOA fees and mortgage, there is no way he can break even, he is better off holding on to the construction loan and either not make payments and let the bank take back the property, or just adjusting the price and selling off the units ASAP