The Miller found 9.2% of deals above ask; Manhattan Loft Guy, not so much

playing with numbers (he wins)
This week my favorite numbers geek for the Manhattan residential real estate coop and condo market weighed in with his (semi) regular Curbed feature, Three Cents Worth, with A Look at Overpaying in Manhattan on February 15. The text contains The Miller’s analysis of sales above the last asking price since July 2008, but the monthly numbers and trends are easier to see in The Big Chart .

This category of the market became a conversation piece for him recently (“It’s come up as a topic in a number of conversations I’ve had with real estate agents recently so I thought I’d look further into it”), as it has for me. Maybe it is simply that above-ask sales are bright shiny objects that naturally draw attention; maybe they really are rare things that have meaning.

I have noted a few above-ask Manhattan loft deals in recent blog posts (e.g., February 15, 18 Leonard Street penthouse (not really a) loft fits a bidding war into 3 weeks, January 26, gut job loft at 395 Broadway provokes war, gets $1,000/ft, January 11, 53 N. Moore Street loft flies (yes) off the shelf, above ask) and have been tempted to look at my loft data more systematically. The Miller’s inspiration (and base line), plus the weekend, give me all the prompting I need.

The Miller’s key take-away:

While the market share for sales above list price has been rising since mid 2009, the premium being paid above list has generally fallen over the past 2 years until recently

His January 2011 data shows the highest ‘market share’ for ask+ deals in about the last 30 months:

– 9.2% of Manhattan apartment sales exceeded the list price at time of sale in January 2011.

– Of those 9.2%, the purchase price was 5.3% higher than list price at the time of sale

the guy is a tease
Sometimes I wish I had more excuses for stuff in (or not in) Manhattan Loft Guy posts that did not directly implicate … me. For example, The Miller is comfortable blaming “the insanely overbearing Curbed staff” for only taking the data back to July 2008; I generally have only myself to blame if I cut off a blog post with a Note To Self for further review. (As I did yesterday with the pregnant mention that there were 13 other 2010 sales that could test an apparent trend: recent Grand Madison sale shows 225 Fifth Avenue lofts still treading water.) Note To Self: start blaming the Curbed staff.

After blaming the Curbed Folk, The Miller drops this confident-but-not-yet-proven nugget, with his bolding:

I plan to build more historical data and I am fairly certain the market share for sales above list price was at least a third of all sales, probably more, during the housing/credit boom

Manhattan loft data is different (weaker)
Obviously, breaking up sales data into small pieces is awkward, as there is a lot of noise is small numbers. If that is a problem for month-by-month segments of the overall Manhattan market problem, it is significantly exacerbated for a niche like loft sales. But in the spirit of having fun with numbers, let’s see what the quarterly loft data looks like, taken from my Master List of Manhattan Lofts Sold Since November 2008 (raw number of loft closings above ask, then as a percentage of loft sales):

1Q09 0 0%
2Q 0 0%
3Q 2 1.5%
4Q 2 1.5%
1Q10 7 5%
2Q 11 6.6%
3Q 11 8.1%
4Q 9 6.8%

If there is any validity to these small numbers at all, the take-away is that there were very. very, very few above-ask loft sales in Manhattan in 2009: only 4 all year. Each quarter of 2010 had more than all of 2009, representing from 5% to 8.1% of the total loft sales by quarter.

Hardly surprising data. And very weak at these levels, but kinda fun, no? Sorta??

Even The Miller’s data is subject to … errr … unnatural volatility (did I just make up a concept in Statistics?). His February 2009 spike shows the perils of slicing and dicing finely: in retrospect, that was a clearly out-of-trend month.

more fun?
Because this was so much fun, even with small numbers, I also counted Manhattan loft sales AT the asking price. (Again, first the raw number of loft closings at ask, then as a percentage of loft sales): 

1Q09 4 0.67%
2Q 2 0.25%
3Q 9 6.67%
4Q 5 3.8%
1Q10 10 8.5%
2Q 10 6%
3Q 12 8.8%
4Q 7 5.3%

Again, not surprising data, but still weak. Counting At-Ask loft sales shows a change after the first half of 2009, and a (very rough) stability after that.

I went back and edited Master List of Manhattan Lofts Sold Since November 2008 to show Above Ask deals in green in the closed column and At Ask deals in yellow in the ask column. Perhaps this will prove useful (or, at least interesting) going forward.

Stay warm, and hold onto your hats today!

© Sandy Mattingly 2011

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