129 West 20 Street hums country tune, times the market perfectly, kinda, sorta

paging Kenny Rogers
Another way to frame the fight or flight question posed for disappointed sellers (in my November 15 post) is

You got to know when to hold ’em, know when to fold ’em
Know when to walk away, know when to run

Hold ‘em too long (when The Market is resistant) and you will have a stale listing, and the reek of desperation; walk away at the right time, and The Market may reward you when you come back.

The Manhattan loft #4B at 129 West 20 Street (the Chelsea Quarter) should have been sold with a vinyl LP when it raced to a successful sale on November 12, since it took all of 25 days (and a 1.5% ‘discount’) to find a contract when it came (back) to market on August 6. “Back to market” in this case refers to the period July 2008 to April 2009 (from near-Peak, through Lehman, well into the nuclear winter that settled on the Manhattan real estate market), when this loft was being ignored by The Market.

hindsight smiles, this time
I have to say that this one was timed pretty much perfectly.

Something happened in the lives of these sellers between January 2007 and July 2008, because they changed their minds about living in this “2,150 sq ft” “sophisticated and serene” condo loft. They paid $2.3mm on the way in, on January 8, 2007, just about 4 quarters short of The Peak, so when they offered it for sale on July 12, 2008 at $2.55mm, they were not only just post-Peak (but pre-Lehman), but they were within a relatively modest negotiating range of their purchase price (+10% over their 18 month old purchase price; many contemporaneous ‘sellers’ were less modest).

I have no idea if they had offers in the Summer of 2008, but if they had, they were probably kicking themselves later. The Market did not like this loft at $2.55mm in 2008, which the sellers acknowledged by taking it off in November, 6 weeks after the Lehman bankruptcy filing. Sad to say, for these sellers, that The Market did not like this loft at $2.295mm from February 3 to April 19, 2009 … pretty much the coldest months of that nuclear winter. So they folded.

Coming back to market on August 6, 2010, they were again relatively modest, in asking just a tad more than they had paid in January 2007 and just a tad more than The Market had rejected during those oh-so-chilly months of early 2009. As you already know, this time The Market immediately reacted positively, and they signed a contract at $2.3mm by August 31.

To be graphic [table-ic??] about it:

fun facts, past sales history
The Chelsea Quarter was a new condominium conversion in 2000. I can‘t see when the original purchaser signed a contract, but she bought on June 22, 2000 for $1.094mm and flipped almost immediately (October 12, 2000, at $1.325mm). That poor soul evidently needed to sell into a weak market, and got out on December 4, 2003 for $1.285mm, after 38 months. That owner had more luck (in the only way I can see: real estate), selling in January 2007 to these recent sellers. That lucky owner’s 37 month tenure showed a nearly 80% appreciation.

Sometimes life dictates when you buy, and when you sell.

The original owner flipped for a 21% gain (gross, not net) after 4 months. The next owner took a slight hit (3%) after 38 months. The next owner enjoyed an early century boom of 80%, gross. And the recent sellers sold flat, January 2007 to October 2010. Although they tried to sell pretty quickly, they ended up breaking the house record for longevity, with a tenure of 45 months. Talk about small beer….

fun fact, music edition
Rogers was the third guy to record that song, per that Wiki link in the first sub-head. Indeed, he was the second to record it in 1978.

Note to self: there’s a blog post, if not an entire treatise, based on the Don Schlitz lyrics. Something like I Learned Everything I Know About Selling Manhattan Lofts From A Country Music Song.

You got to know when to hold ’em, know when to fold ’em

Know when to walk away, know when to run

You never count your money, when you’re sittin’ at the table

There’ll be time enough for countin’, when the dealin’s done.

Those last two lines pretty directly address the fear that some sellers have to price it right, if that means selling for less than they paid (aka The Anchor Effect), doesn’t it? Or maybe they are most apt describing a seller reluctant to drop the price a second time, who thinks I can’t afford it; I have already lost $xxxx in dropping the first time.

© Sandy Mattingly 2010