65 West 13 Street loft sales shows the trick about being patient

it’s the price, stupid!
I’ve been on a bit of a jag lately, noting Manhattan loft sales that defy Conventional Wisdom by holding firm at a price for a (relatively) long time, then getting a deal done within reasonable negotiating range of that price. (5 in the last two months;  below.) The latest example if the Manhattan loft #2B at 65 West 13 Street (The Greenwich), which sold on May 25 for $3.625mm off a single asking price of $3.95mm from coming to market on September 18 and finding a contract on March 2.

That Conventional Wisdom, of course, is that a loft professionally exposed to the Manhattan residential real estate market for more than a few months needs a price change to sell (not just lofts in Manhattan, of course, but that is my interest, and that is why you are here). I don’t know that I have made the obvious comment about why some stubborn sellers succeed:  stubborn sellers that sell are at the right price; stubborn sellers who do not sell are not at the right price.

One other obvious-in-retrospect point: the only way to tell whether a stubborn seller has the right price is whether it sells without a price drop, so there is no rule here that can easily be applied prospectively by sellers inclined to be stubborn. Let me put this another way, it pays to be stubborn if being stubborn gets you a deal near your asking price; it does not pay to be stubborn if you have to drop the price. (Glad that’s clear!)

the stubborn seller and the right buyer
If one is inclined to be a stubborn seller (i.e., to reject The Market’s ‘advice’ that a 3 month old price is too high), it probably helps if you have a special listing, a property that has some significant plus-factors for The Market, plus-factors that will appeal to a slice of The Market. In the case of #2B, that would be the patio (“516 sq ft”) and the volume; possibly the level of finishes.

I have said before that some people will overpay for outdoor space, and often cite my May 6, 2010 post about The Miller’s rubrics for measuring their value. This patio is especially nice as easily accessible from the loft (though accessed only through a bedroom), a very usable size and shape that is much smaller than the interior space, and relatively private (for a mid-block 2nd floor patio).

The “volume” here is both functional (3 bedrooms, plus various ‘spaces’ within the main spaces, such as the home office, the dining area, the media area) and geometric (14 foot ceilings, and 19 feet of width at the most narrow public area). All in all, this is a pretty terrific floor plan, with a lot of flexibility for buyers who need multiple rooms / spaces.

The location is Prime Village, as proven by the main downside: that lovely arched front window looks out on West 14 Street … from only the 2nd floor. That is the kind of drawback that is fatal for the buyers for whom that is an issue (meaning: they would not consider it any any price, no matter the other positive factors). But for people who come back a second or third time to visit … that is the kind of negative that can be talked around, or over-weighed.

SO the right buyer for this space (it could be anyone, but this is the ideal) is someone not turned off by 14th Street down below the front (and master) windows, who wants a lot of space, who needs more than 2 bedrooms, and for whom nice outdoor space is significant premium. There will not be many premium choices for such a loft buyer at any time, so that buyer might be forced by a stubborn seller to negotiating a mature asking price.

reasonable price, on recent-ish comp
The last sale in the building at a similar scale was #7A on June 28, 2010. Compared to #2B, #7A is larger on the inside (“2,802 sq ft”) and no worse in finishes or functionality. In exchange for the #2B patio, #7A has the quiet of a high floor. It may have gotten bruised by The Market in not selling in 2008 and 2009, but it sold quickly at full ask when it came out on March 6, 2010 at $3.85mm (contract, April 1).

#7A got $1,374/ft a year ago. #2B got $1,369/ft ignoring the outdoor space; adjusting for the patio at 50% of the interior value, #2B got an adjusted $1,248/ft. The 10% premium for #7A over an adjusted #2B seems reasonable based on the difference in floor value for #7A compared to bus-top views of 14th Street in #2B.

Using that 50% adjustment for the patio, #2B started asking $1,360/ft, essentially flat to #7A, which had closed only 3 months before #2B launched. They needed only a negotiation discount of 8% to get their deal, and they waited (stubbornly!) for almost 6 months to get it.

Sometimes you get the bear; sometimes the bear gets you.

CW bashing, all in good fun
Other posts on defying the Conventional Wisdom (Successful Stubborn Seller Edition, of which there have been many):

© Sandy Mattingly 2011

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