persistence pays for Chelsea House loft (that, and the right price)

and a willingness to take a hit
A quick look at the listing history of the Manhattan loft #7B at 130 West 19 Street (the newly-built-in 2006 Chelsea House) suggests a theme of price right to sell quickly, as it came to market at $1.25mm on November 8 and found a contract by December 23 at $1.231mm (the January 25 deed was filed yesterday). A slightly deeper look into the deeper listing history suggests a theme of persistence pays off, as this loft had been offered for sale from October 2009 into May 2010. And … from November 2008 into March 2009. Suggesting a theme of the chills of the nuclear winter, or the difficulty in pricing in a thin market, or the pain of over-pricing.

So many themes, so little time. SIgh.

Here’s the full history. If you can’t remember the important context of what happened to the overall Manhattan residential real estate market in the two months before this loft first came up as a resale on November 28, 2008, use The Google (Lehman bankrupcty, or Manhattan Loft Guy and nuclear winter). I’ll wait. 

That’s 18 months of marketing at the demonstrably wrong price (including a 6-month hiatus) followed by another 6-month hiatus and a re-set at the right price, resulting in a “quick” contract and sale.

the disappointed seller’s conundrum, redux
You have to feel for this seller’s unsuccessful attempts at price discovery in the terrible market conditions that followed the Lehman bankruptcy (September 15, 2008; but you knew that) and associated credit-tightening and all around market-going-to-hell stuff. Evidently, he needed to sell (why else come out 6 weeks after Lehman?). Evidently, he observed that The Market was extremely thin in early 2009, so took a significant time out.

The seller was struggling with the same dilemma that other disappointed sellers go through, whether to fight The Market resistance by dropping the price (again, and again, and …), or to flee in response and wait to fight another day. That conundrum I addressed in my November 15, flight or fight? the disappointed seller’s conundrum, 30 East 21 Street and 205 West 19 Street lofts edition.

This seller had bought the loft only 27 months before starting to try to sell (put that August 25, 2006 purchase at $1,454,061 on top of that table up above), so something happened in his life to change his real estate needs or financial picture. He started at what must have seemed to him to be a modest asking price (a 3% premium to his original sponsor purchase, which was a November 2005 contract), much like the seller of #4B at 129 West 20 Street (the Chelsea Quarter), who I profiled in my December 11, 129 West 20 Street hums country tune, times the market perfectly, kinda, sorta. That seller sought a 10% premium to an 18 month old purchase price in July 2008 — that awkward market period between The Peak and The Winter. In that instance, the seller took a long hiatus (April 2009 to August 2010) before coming back a little higher than where he’d left off, and selling quickly (contract in 25 days) at the same price he’d purchased at in January 2007.

Did I mention that The Market is not fair?

The Chelsea House #7B seller was trying to do pretty much the same thing, but to stay off The Market for only 6 months (to October 2009, a market that was definitely showing some signs of a thaw by then) and asking less than he’d paid in August 2006.

No dice.

He fought the market (again) at $1.4mm from October 2009 into May 2010, before fleeing (again). Trust me, there were lots of lofts that sold in this period at a premium to where they had sold for in 2006. I never ran that data to find 2006 paired sales, but the pairs I found starting with a 2007 sale (March 5, 2010, data dump: 27 Manhattan lofts sold in 2007 + recently) should suffice on that point.

proving you really want to sell
So this guy got a deal by starting over 3 months ago $200,000 below where he had bought the loft in 2006. A lot of sellers have trouble overcoming that refusal to take a loss thing. As I said in my October 24, real estate market psychology: about seller refusal to take a loss

In all cases with these psychological barriers, a good agent will help a buyer or seller recognize and compensate for the tricks his or her mind is playing on his or her judgment. It is up to that buyer or seller to decide, of course, if he or she really wants to buy or sell within the confines of the then-current market.

Props to the agent and seller for breaking through the disappointment with The Market to take the deal The Market offered.

© Sandy Mattingly 2011