Defending the Eight-Figure Price Tag
We’ve already covered the record-setting price of Brooklyn Height’s 70 Willow Street (above), the $25 million asking price of the Dumbo Clocktower, and the $12 million price tag on Bay Ridge’s Gingerbread House in recent months. As the New York Observer notes this week, these are the only three residential props on the market in…
We’ve already covered the record-setting price of Brooklyn Height’s 70 Willow Street (above), the $25 million asking price of the Dumbo Clocktower, and the $12 million price tag on Bay Ridge’s Gingerbread House in recent months. As the New York Observer notes this week, these are the only three residential props on the market in the borough with eight-figure price tags; by comparison, Manhattan has 288 (and another 54 already in contract). Is Brooklyn really ready for this price strata? Well, the brokers with the $10-million listings certainly think so–if you’ve got something unique. “It would be almost physically impossible to have anything like the Gingerbread House in Manhattan,” said BHS broker Bill Radtke. Of course, a little old-fashioned chutzpah doesn’t hurt either. As Asher Abehsera of Two Trees who’s the pitchman for the Clocktower says, “It’s ballsy to come out in Brooklyn and say, ‘I’m going to price this at $25 million,’ but we were confident about it because there’s just nothing like it.
Why Three Brooklyn Listings Dare to Ask $10 Mil [Observer]
70 Willow Street Hits the Market [Brownstoner]
All About the Clocktower [Brownstoner]
The Gingerbread House Hits the Market [Brownstoner]
DIBS – EVERYONE cares if their RE goes up or down – EVERYONE
as for ISNH “Before Manhattan got to the prices it commands/demands now, there must have been a point when there were only a handful of high priced properties”
Yes but this isnt a case where 3 properties are priced at 12, 18 and 25 million respectively and their are a whole bunch more at 5-12M, there isnt – there is a huge gap – looking at the big 3 RE brokerages aside from these 3 there are only TWO OTHER listings above 6M (A 3ksf apt in Dumbo and a Cobble Hill Brownstone).
As for the comparison to art – it isnt art, its RE, and they arent even all that unique pieces of RE either. Rationalizations like this are always made when people are OVER paying – only 3 years ago, idiots were buying office buildings in Manhattan for 1B on the premise – ‘well they are never going to build another _____ Building’ –
those buildings are now worth approximately 60-70% less than the highs.
First of all, the buyer imagined in the gingerbread listing and imagined in some of the posts here has to actually exist. At that price level the competition is stiff. You’re competing with lovely townhouses in Manhattan and the best neighborhoods in Brooklyn. Would somebody who can afford a $12mm house really choose Bay Ridge? People with that kind of money don’t want their residence in the city to be a total hike for their friends from Manhattan. Their far-located house is their Summer house out of the city, not their in-town residence. That house should priced much lower, as much as half, at $6 or 7 million so a wealthy longtime old-school resident of Bay Ridge who has always coveted the house can buy it. That’s who their buyer is. The newer arrivals buy in Bay Ridge because they can’t afford Park Slope or Carroll Gardens, etc. They’re not $12mm-house types.
buyer dont give a shit. others think buyer is a sucker. both are very probably and not mutually exclusive
Investors who buy Van Goghs and Picassos are not suckers but they are taking a significant financial risk. The value of fine art goes up and it goes down. Flemish masters were much more highly valued a hundred years ago then today. Ditto Italian renaissance art. Romantic art was once very highly valued, then went to near zero, then went back up. Who knows where it will go next?
It is a gamble to pay a huge amount for something that everyone knows is over valued but that nonetheless could become even more so.
“Sucker” is a very subjective term. For example, a lot of the country looks at all of us as suckers for paying the rents we pay the sales prices we pay to live in small boxes and cartwheel up and down Flatbush Ave just because we’ve scored a dishwasher and a closet we can hang 12 shirts in. Plenty of people on this board consider many residents of Crown Heights and Bed Stuy to be suckers for living where they do. Plenty of people on this board consider many residents of Brooklyn Heights and Park Slope to be suckers for paying what they pay for what turns out to be less space for the money that what you’d get in other neighborhoods. If the people who eventually buy these 8 figure properties (assuming someone buys at said prices) are happy with their purchases, I say the bigger odds are that they don’t give a rat’s patootie about our armchair quarterbacking and definition of ‘sucker.’
Usually, those that buy properties at these prices don’t really give a shit whether the price goes up or down.
Sellers/brokers price like this also to get attention. Space is worth what someone will pay for it but pricing super high gets great attention and press. Key part of decision.
sucker or not will be determined much much later in the future. at the time of purchase, bigger odds one is appropriately viewed as a sucker
Sally, great analogy about buying a Picasso or Van Gogh.