flipping for fun, not profit, in Soho

is it only ‘triple’ mint if you use more then 3 X’s?
Soho doesn’t much more prime than the location of this new-to-market Manhattan loft that has caught my eye. Nor does a listing description get much more enthusiastic than this one, the relative brevity notwithstanding. The loft is very large, very well appointed, with its guts truly renovated not very long ago. But I am most interested in what this new Manhattan loft listing says about The Market today.

Here’s what it says: asking 4% more than the March 2009 wanna-be-sellers paid last Summer is not a sign of confidence, but is probably more a desire to save some of that oh so precious (over-valued?) negotiating room. In other words, these Summer-2008-buyers-turned-Spring-2009-sellers will not have a capital gains problem if they happen to sell within 12 months of their purchase.

another 1 of 8,000,000
These folks want to get out, and are willing to get less than they paid in order to get out. Perhaps they are caught in the grinding gears of a Wall Street meltdown; whatever the cause, their plans have changed dramatically since AIG and Lehman. They bought a beautiful loft, no question. Their sellers did pretty well in fixing it up (they added all those X’s sometime after buying in 2004), both esthetically and financially. Those 2004-buyers-turned-2008-sellers sold for about 170% of what they paid, so even if that renovation cost them $300/ft in 2004 they cleared over a million bucks.

 

That is how to flip for fun and profit: do a wonderful renovation, then live in it a few years so you can enjoy it before passing it on to people very appreciative of your efforts.

bet the under

The current owners won’t have any profit (transaction costs will do that to even a 100% deal); whether they have any fun depends on how much they will enjoy having to drop their price. (I happen to think that they may have priced over-optimistically, but I should let The Market tell us that.) I’ll not say more for fear that the Discerning Manhattan Loft Guy Readership will identify this loft too easily (I am looking at you, Lofty.)