We hope that everyone is enjoying the beginning of summer and we, at The LevinKong Team, want to wish everyone a very happy and safe Independence Day holiday weekend. It is amazing to think that we are already halfway through this incredibly eventful year!
New York City just experienced a very active spring market and all indications point to this trend continuing into summer. In years past, the July Fourth holiday marked a predictable slowdown in activity that carried through until after Labor Day. We have been predicting that this summer will be different due to a combination of pent up demand caused by the pre- and post-election slowdown, the heavy reliance on the internet to market and search for properties, and the ever-increasing out-of-town buyer pool that does not seem to adhere to our preconceived notions of market seasonality. We have already seen this borne out as we received multiple new listings and new buyers have decided to work with us in just the last week.
In general, our consultations with buyers have been shaped by the segment of the market within which they are searching for property. Buyers in lower price-points are anxious to find properties that suit their needs and are well aware that they are in a very competitive market. Luxury buyers, in general, do not feel hard-pressed to make decisions and sense that time is on their side. Many high-end buyers had expected the market correction to occur more heavily in their favor but have a general sense that they will find good value with expert guidance. A disconnect is occurring in the middle of the market where buyers’ expectations for deeper discounts have not been accommodated by sellers and incorrectly priced property has found itself sitting for extended periods.
In response, we find that strategic pricing in the middle of the market, $1.5 million to $3.5 million, is so crucial to successfully achieving the highest sales prices possible. This segment of the market is incredibly fluid and price and value are often moving targets based on current inventory. Along these lines, we have been presenting sellers, particularly in this segment, with a price range when we first meet and holding off on a firm asking price, often until the day we list the property. This way we are not committed to a price that is not in line with the market and competitive properties.
Anecdotally, we marketed a property this spring where all conditions suggested a sales price around $1.5 million. After painting and staging the property, we felt that a price of $1.6 million was realistically achievable. However, when we were ready to list the property, we noticed that there was a lack of comparable inventory on the market. We asked if the seller would trust our judgment and list the property for $1.7 million. They agreed and we wound up with multiple offers within a few days on the market and a signed contract above ask.
The LevinKong Team works with many investor and end-user buyer clients that are looking to purchase in new development condo projects. We are seeing a significant uptick in interest in three particular areas. Yorkville, an area that has recently been positively impacted by the arrival of the long-awaited Second Avenue subway line, is on the radar of many of our foreign investors. This is not an area known as a magnet for foreign investment; however, due to the lower than average per square foot pricing and the anticipation of higher rental demand and price appreciation, many well-informed investors are bullish on this neighborhood.
Another neighborhood, newly connected by the addition of a subway line, Hudson Yards is an emerging area that is on the radar for many of our high-end buyers due to the incoming luxury condos, luxury shopping, and fine dining. The area is also attracting those who want urban greenspaces at their front door; The Highline, Hudson River Park and Hudson Park. And, with the new No. 7 Subway extension, open as of fall 2015, Hudson Yards is accessible and convenient to the rest of Manhattan.
Lastly, The Upper West Side’s Waterline Square has become a preferred destination for buyers who literally want it all! Comprised of three condominium towers designed by ‘starchitechts’ Richard Meier, Rafael Vinoly, and KPF, each of the three new buildings features every imaginable amenity, panoramic river views, and the new enclave will feature its own ‘waterline club.’ The Waterline Club, connecting the three buildings of Waterline Square will boast an indoor tennis court, 25-meter lap pool with adjacent children’s pool and spa pool, full court basketball, squash court, indoor soccer field, a rock climbing wall, a state-of-the-art fitness center, children’s room, game room, and even a recording studio.
There are certainly new development condo projects that are selling at a fast pace and selling at or close to their asking price. However, in general, the abundance of inventory and the smaller buyer pool for these new development condos has allowed for more negotiability than we have seen over the last several years. Condo projects are competing for buyers and we are getting a fair amount of inside information on what type of discounts and concessions the sponsors have been giving to other buyers.
We will continue to keep you up to date on recent happenings and trends in the market. We hope that you find this informative and useful and, please, as always, reach out with any questions on how you can take advantage of these current trends or how to protect your real estate assets. Also, feel free to reach out with any questions regarding a specific trend or segment of the market. The LevinKong Team is available to serve all your New York City real estate needs and those of your friends, family and colleagues.
389 East 89th Street
360 East 89th Street
15 Hudson Yards
One Waterline Square
Two Waterline Square
Three Waterline Square