A 1941 co-op building on a corner of Amsterdam Avenue in the low 90s of Manhattan’s Upper West Side has not one or two, but three studio apartments on the market at the same time. And, though they are profoundly similar, two of them went on the market at $50,000 more than the third one .
First, the less expensive one. It is on a high first floor with decent, though hardly bright, light. The kitchen has been attractively modernized, the bath has been updated with re-glazed bath and wall tiles, there is fresh paint, the hardwood floors are pristine, new sliding French doors demarcate the sleeping alcove, and the amount of closet space is extravagant.
The 500-sf unit is listed at $349,900, and it received an adequate offer within a couple of weeks.
Next to be offered was a third floor, 525-sf apartment that is close to the mirror image of the one on the lower floor. It differs in at least six respects: The foyer is bigger; the exposures are mostly unobstructed; the kitchen and baths demand updating; the sleeping alcove is open to the living room and appears to be a bit smaller; closet space is roughly two-thirds the amount in the other unit; and the condition bespeaks longtime neglect.
Price: originally $400,000, recently reduced to $385,000, thereby chasing the market.
With a floorplan identical to the one on the third floor, the fifth-floor studio is shown, mysteriously, as having 550 square feet. On a higher floor and reeking of cigar smoke, it is in much better condition than the apartment on the third floor but not nearly as well updated as the unit on the first floor.
It is offered at $399,000, close enough to $400,000 to justify the headline.
As everyone knows – especially sellers – setting the asking price is as much an art as a science. The science part is comparable sales, though they are woefully out of date in a dynamic market such as Manhattan’s. Aside from trying to worm contract prices out of sellers’ brokers, the next best approach to science is to check the offering prices of similar properties.
Making sense of those numbers is part of the art. Other aspects of the art include balancing the seller’s hopes and expectations against the reality of buyers’ perceptions of value and their ability to pay what is sought.
Should the sellers price above the market to leave room for negotiating down? Should they price on the market to reflect a property’s value and snare as many prospects as possible? Or should they price below the market in the hope of starting a bidding war?
Making that crucial decision is where art merges with strategy.
What prices should the sellers of the three studios have set for their apartments? For the first floor apartment, the price was obviously on target. Since that is the case, the asking price of the third-floor apartment was originally listed too high by $35,000. For the fifth-floor apartment, the price is too high by $25,000.
If details such as those above intrigue you, be sure to check out the e-newsletter that I write every two weeks (except during the holidays) for my critiques of properties I visit, plus a range of information related to real estate and the Big Apple.
Licensed Associate Real Estate Broker
Senior Vice President
Charles Rutenberg Realty
127 E. 56th Street
New York, NY 10022