Latest posts by Gea Elika (see all)
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Despite record days on market for the average apartment in New York in the third quarter “Not Yet A Bottom, But Turning A Corner as Sales Surge“, turns out that not all deals happen below offering price. Residential brokers across the city are finding that bidding wars are coming back, and apartments priced correctly are actually commanding prices above list price, according to the New York Times. Bidding Wars Resume Furthermore, because of the tightness in credit, a lot of the bids are coming in as cash.
Jonathan Miller of the appraisal firm Miller Samuel believes that two-thirds of the estimated 4,000 apartments for sale in Manhattan are overpriced. But those apartments priced 20 to 30 percent the highs of early 2008 are attracting multiple buyers willing to outbid each other, on everything from starter one-bedrooms in Brooklyn to Central Park West luxury enclaves. One two-bedroom on the Upper West Side, for example, sold within two weeks by Halstead Property in October for $1.8 million—at over $200,000 more than the listed price—following a bidding war among nine suitors. Brokers are attributing the phenomenon to pent-up demand and a shift in the confidence of buyers entering the market since Labor Day. The weak dollar also helps, attracting foreign buyers.
According to Halstead’s Amelia Gewirtz, those that are pricing for 2009 or 2010, i.e., “for buyers who think prices might go down another 5 or 10 percent,” are the most likely to attract better bidders. And according to Genifer Lancaster of Prudential Douglas Elliman, pricing below market value can actually result in the apartment being sold far above fair-market price.