Today’s New York Times gets it right in the lead story of the Real Estate section.
The piece catches up with the times in noting how much opportunity there currently exists for buyers, especially those interested in larger apartments.
It also responsibly–hallelujah!–details the pitfalls of buying a three-bedroom apartment that doesn’t cost an arm and a leg: the amount of space, the size of the rooms, high maintenance and the building location.
(The piece doesn’t go into obstructed exposures, street noise, awkward layouts and other common minuses, but I do so in the Out and About section of the free biweekly e-newsletter that I write every two weeks.)
About one of the profiled units, the Times had this to say:
“There is, for example, a three-bedroom apartment for sale for $950,000 on the 15th floor of a doorman building at 444 East 75th Street and York Avenue. The apartment, 15DE — a combination of two units, a studio and a two-bedroom — is about 1,440 square feet, with lots of closet space, a small office and views of the East River.
“The building does have drawbacks. Buses stop nearby, but it’s a hike from the subway, and the maintenance is high, almost $3,000 a month.”
Acknowledging how easy it continues to be to spend $3 million or $4 million on a three-bedroom apartment, the article quotes appraisal executive Jonathan J. Miller on recent prices. He says the the median for a three-bedroom in Manhattan fell 42.0 percent, from $4.05 million the fourth quarter of 2008 to $2.35 million in the fourth quarter of 2009. In that same period, two-bedrooms fell 23.3 percent, one-bedrooms, 7.6 percent and studios, 10.7 percent.
One explanation for the big decrease is size. The average three-bedroom unit that closed in the fourth quarter of 2008 in Manhattan was about 2,650 square feet. A year later, it was about 2,100 square feet, a 21 percent reduction that, therefore, accounts for half the drop in price.
Ironically, late Friday I showed an approximately 1,800-sf four-bedroom corner co-op to a buyer I represent. The fifth-floor apartment, overlooking a busy intersection with bus stops in two directions, needs serious updating.
At approximately 1,800 square feet, the place on Manhattan’s Upper West Side is ridiculously overpriced at $2.395 million, but the appropriate ask still is many hundreds of thousands dollars beyond $1 million.
Despite my experience the other day, I definitely have seen a trend to much more reasonably priced units along with room for negotiation. “Stability” seems to be the watchword for today’s real estate market in Manhattan.
And as I constantly remind buyers, I have never worked with anyone at any price level who hasn’t had to make compromises. Such has been the case forever and remains so today.
Licensed Associate Real Estate Broker
Senior Vice President
Charles Rutenberg Realty
127 E. 56th Street
New York, NY 10022