Last Week's Biggest Sales

I manage musicians.

Re: 14th Street Warren Lewis house – I noticed that too. Does seem like perhaps a distressed seller? It can’t be a flip since the new owner will barely recoup costs even if they were to sell at that vastly inflated price (to cover closing costs when they bought, and brokers commission when/if they sell). Perhaps they went into contract and regretted it, but then figured they were worse off losing the 10% down (almost 200K) than whatever the loss is they will sustain now? Very strange.

And 11217 – are you a lawyer? If not, what kind of work do you do? Just curious.

I think there’s some truth to both those who point to continuing deterioration since these went into contract, and those who say some properties will do better than others. That said, even in prime areas, there is a lot of variation between blocks and even properties. Sure, there is the occasional grand mansion by the park, but there are also lots of much less desirable properties and that is where bargains are increasingly to be found. We saw Berkeley which had several price cuts and at one point we were told that the owner was willing to accept an offer of about 2 mil – more power to them if someone came along willing to pay more. But such buyers may be fewer these days, and the low inventory of today may change, and the increasing price cuts, even in prime areas, will have a ripple effect. When Corcoran cuts 400K off a 4 story “beauty” in prime PS i.e. from 2.5 to 2,1, then the lesser house priced at 2.1 suddenly looks overpriced, and when they cut to 1.8, suddenly the even lesser house priced at that point looks overpriced, and so on down the line. Real estate historically moves slowly, so it’s not surprising that there is still strength showing so close to what I think is widely agreed these days to have been the peak in the prime areas (not the statistical peak of the whole NYC area, which was earlier). I have yet to hear even the bullest of the bulls predict any price increases in the year to come, so I think I personally am in a good position, since we will keep looking now til we find the right thing at an affordable price. There *are* price cuts now, undeniably, even in prime areas, and the trend, if anything is for those to continue, not reverse. How steep those cuts will get is anyone’s guess. This is certainly not the end of the world but it is a major economic downturn and indeed even the prime areas of NYC will not be immune.

i disagree…there is no evidence of an actual or likely “25%-50% drop” in any of these properties. So the 10% downpayment is still very relevant and I would bet money that none of these properties saw further price negotiation at the closing. You’ve got no basis in (current) reality for that logic.

poley, this argument for the “basic irrelevance” of properties that went into contract pre-crash is largely bs. let’s review: buyers, especially those rich enough to be paying $2 or $4 million in cash, do not become deaf, dumb and blind to the realities of the marketplace the moment they sign a contract. nor do sellers at that level. if the market was so evidently tanking the 25-50% people talk about and doing it at the speed with which you suggest, any non-idiotic buyer would demand concessions or walk away, and any non-idiotic seller would come to the table and you’d see lower closing prices. owners and buyers of places are rich, and the majority of rich people don’t get that way by being stupid, or timid, or emotional about business dealings. obviously, a 10% deposit skews the assessment slightly, but not enough to cover a 25%-50% drop, and not enough to make the closing prices irrelevant.