Bidding War at 330 E 75th
A: Perhaps a market trend as we enter bonus season? I was trying to schedule an appointment for one of my clients to view apt 23C at 330 East 75th when the broker told me there was about 20 people at the last open house and a bidding war the next day with the top bid accepted and now contracts out. I was told the bid was significantly over the asking price. The apartment is LESS THAN 3 weeks on the market! I know this is a bit off-topic from my usual stuff, but I feel the need to pass on any abnormal market behaviors that may signal a change in current trends.
Hmm, sounds strikingly similar to a post I did a few days ago on Pricing Right?
FLOORPLAN OF APARTMENT 23C
DETAILS
First Came on Market: 11/26/2006
Asking: $1,050,000
maintenance: $778
RE Taxes: $1,060
Size: 1,025 SFT
PPSF: $1,024/sft
Marketed By: Patti West of Lamb Realty
OTHER 2BR ACTIVES
APT 11G - For Sale By Owner
Size - 1,050 SFT
Asking - $1,080,000
APT 18C - Marketed By James Elise of SHVO Group
Size - 1,000 SFT
Asking - $1,375,000
LAST 2BR COMPARABLE SOLD
The last 2BR that was comparable to this one sold back in July of 2006 by Douglas Heddings, you know him the Elliman broker turned blogger over at True Gotham. Here are details of that sale:
APT 8E - Lower Floor
ASKING - $1.2M
SOLD FOR - $1,090,000
SIZE - 1,100 SFT
PPSF - $991
So, APT 23C that just went into a bidding war started out their pricing BELOW what the last lower floor apartment sold for in the building. Even with a fifteen floor difference giving a clear premium to 23C at resale, they decided to start the unit for sale below 8E's ultimate sales price. This aggressive pricing strategy stimulated activity and resulted in a bidding war.
Quick Tip: A generally accepted principal for calculating the premium of a higher floor apartment is to add $10,000 per floor. However, difference in views (such as a park view instead of a streetside view) must be taken into account as well. For co-ops, usually the premium is already added into the amount of shares allocated to the higher floor apartment. For example, apartment 8E would be issued 400 shares and apartment 23E (assuming exact same line and layout) would be issued 550 shares, or 150 shares MORE (10 shares per floor). This is a very general example so be sure to do your research on co-op apartments when calculating the premium of being on a higher floor and the more desireable light and views that come with that.
UrbanDigs Says: Clearly 23C was a value compared to other 2BR apartment's currently listed for sale at The Saratoga building on 330 East 75th street. I even heard the broker mention something about this being a bankruptcy sale which would mean a great find for the lucky buyer but a few weeks of legal headaches clearing the way towards closing. The permanent features of location, light, and views helped the apartment sell in a very short period of time. Well, that and the fact that it was PRICED CORRECTLY! This just goes to show you that the NYC housing market is still healthy and does have a savvy buyer pool that is willing to go after properties that are asking market value. The strategy of pricing aggressively, stimulating demand, and hoping for a bidding war worked perfectly for Patti West with Apt 23C and should be used as an example for sellers out there having trouble moving their property!
Comments (2)
Hey Noah,
Thanks for the props for sale of 8E. I'm a huge believer in aggressive pricing but I think we have to be careful in a cooler market. It works when there is demand but didn't work well in the early 90's when property was on market for 2 years. That said, I now have multiple offers on one of my properties, just had bidding war on another and just lost an apartment with a buyer who couldn't be convinced to bid ask or better. I'm seeing more traffic at open houses and speculate that many of these "new" buyers will be purchasing in the next 30-90 days with that big bonus money. Time will tell.
Keep up the good work and see you at Inman.
Posted by Douglas Heddings | December 13, 2006 4:15 PM
Hey Doug. No problem, good to see it was your sale when writing this post. Im definately seeing a pickup in business also on the buyer side but still a bit slow for my exclusive at 96th street that is priced at the higher end due to light/views of CP.
I did get a $2M bid that was not responded to. Oh well, what can I say.
But the market is definately not crashing by any means; rather, its pretty healthy find conversations Im having with other colleagues.
Posted by Noah | December 14, 2006 11:26 AM