Buying real estate in NYC can be a high-stakes game. With property values and buyer preferences in a constant state of flux, it takes some careful research to arrive at the right price to set for your apartment. Whether it’s a condo, co-op or townhouse, you’ll eventually have to settle on a price before putting it on the market. Here are the factors you need to consider when deciding on your asking price in NYC.
Research your neighborhoods selling points
If you plan to list your apartment soon then now is the time to start looking at other listings in your building and the surrounding neighborhood. The quality of life in the neighborhood is just as important as the property itself. A great resource for researching your neighborhood it AddressReport. It provides data on everything from demographics to crime to even the air quality and a number of street trees. See what other sellers are asking for and how your apartment stacks up against theirs.
Compare your building type with similar buildings
NYC has a lot of different categories for the types of buildings that can be found there. Pre-war, post-war, new developments, full-service buildings and so on. When researching other listings in your building and neighborhood it’s important that they are compatible with your own apartment. Don’t try and compare an apartment in a full-service building with one in a low service one. Or an apartment in a pre-war building with a post-war one. The same goes for comparing a condo and a co-op apartment as the pricing between them can vary widely.
Check the price per square foot in your building
Once you have a list of comparable properties based on your neighborhood and the building type check the price per square foot (PPSF) of your apartment. This is a bit challenging as there are a number of different interpretations of how PPSF is calculated. Start by looking at the average and then look at recent sales that were way above the average and way below. You should start to get a good idea of how your apartment compares. Don’t make the mistake of comparing the PPSF of your older condo to a luxury new development condo whose starting prices are way above yours.
Compare the layout of your apartment
This is hardly groundbreaking but it’s important that you compare your apartment with properties that have a similar bed/bath count and overall layout. Optionality is always more valuable. Even if your apartment is in a similar building with similar square footage but the other one has an extra bathroom or a balcony it wouldn’t be appropriate to compare the two. Making a valuation based on layout adjustments is obviously a little subjective but it goes by common sense.
Compare the difference in the condition
Obviously, it wouldn’t be right to compare a newly renovated apartment with one that it is getting on in years. If property A has a newly renovated kitchen or bathroom (generally the most expensive renovations) while property B does not, a price adjustment would be needed. In general, the price difference between a property with a newly renovated kitchen and one without can be $20-30K. For one with both a newly renovated kitchen and the bathroom can be as much as $60k. Another important factor in condition is flooring. In NYC, a typical hardwood floor can cost $2-6 per square foot for materials along with $2-4 per square foot for installation.
Coming up with the right asking price is crucial if you expect to have a fast and easy sell. If you’re not getting multiple offers within the first three weeks then you’ve probably priced too high. Hiring a good listing broker will give you a better chance of coming up with the right price. They have the market knowledge, insider information, and experience from previous sales of what makes a competitive price. All the same, though you should have a good idea of what goes into an asking price. It will make you savvier when it comes to negotiations and deciding on multiple offers.