Nov. 20, 2007 - predicting next price drop at 135 Hudson Street
see a pattern here?
#6F at 135 Hudson Street has been on the market since July 2006 (less about ten weeks in two Temporarily Off The Market sets). It is said to be "1,400 sq ft" with tongue and groove original pine flooring and hints of work to be done ("current configuration is as an open space with three sleeping niches"; "rare original classic artist loft"). It also has five flights of stairs ("presently a walk up").
Here's the price history:
$1.65mm July 11, 2006
$1.6mm April 27, 2007
$1.55mm Oct 2, 2007
$1.5mm Nov 19, 2007 (interesting that BHS website does not have the new price yet)
Can you see where this is going?
bullets are hard to bite
As I have suggested before the conversations about price adjustments between agent and seller can be very difficult. Each situation depends on the specific facts, of course (how many people have visited, any bids, etc), but everything becomes more clear as retrospect gets longer and longer. The slow death of small increments is a painful process, which can be hard to recognize in the emotion of selling -- until it is too late.
price should help sell (d'oh!)
Which leads me to wonder "why drop a price?" The chorus will answer "to sell the apartment!!" but I was thinking on a different level. Or, on that level, but with emphasis on selling the apartment. The question-within-a-question then becomes "what price change will help sell the apartment?"
As I tell people to whom I pitch a listing, the asking price is the single most important element in setting buyer's expectations about a listing. Does a $75k price change increase the likelihood of selling the apparent? I don't think so, but others may have different opinions.
Many sellers view price drops as talking money out of their pockets, notwithstanding the fact that at that point they have no money in their pockets.
Sellers hate to 'give away' money - even money that they never had in their pockets (like the $125k that the 8A seller has "lost" by dropping the price to $1.225mm). As a result, many sellers are tempted to drop the price by a minimal amount - if at all.
Which leads to death by small increments.
Most agents have stories about an apartment that finally sold well below where they thought it should have sold for. Often, these stories feature price histories with many small changes. (E.g., the 2 BR that went from $1.2mm to $900k in increments of $50,000.) In retrospect, the agents say that a larger intermediate price change (say, from $1.2mm to $1mm) would have resulted in a higher and quicker sale.
#6F looks to me like a candidate for death-by-small increments. Not to mention that I don't think that The Market has demonstrated that even the new price is the right value.
$1,000+/ft ain't easy at this height + location
The last sale in this building was one floor down, in the back (west). #5R traded in July at $1.65mm (N.B., just over $1,000/ft for the "1,640 sq ft") and was profiled while in contract on June 7 (Tribeca tunnel & stairs discount / 135 Hudson in contract).
Here was my comment about that one then, contrasting it to 100 Hudson Street #5A, which was offered at $1,300/ft (Olde Tribeca for $1,300/ft at 100 Hudson):
The kitchen here has all the proper proper nouns, the bathrooms look appropriately sleek, it is at least as sun-filled as 100Hudson's #5A, and it has a "unique hybrid timber and cast iron structure" that I can't figure out from the pix for the life of me. The layout is an unusual Long-and-Narrow, as the windows are on the two long sides.
I think it is one of the most handsome small old loft buildings in TriBeCa.
But it is just enough north of the central Tribeca part ofHudson Streetto be on the spillway from the Holland Tunnel and it has those four flights of stairs. (I love the optimism implied by Siim's description of the building as "currently a walk-up".) So the (successful in two months) asking price is just under $1,000/ft.
#5R vs. #6F
Compared to that description of #5R, #6F says nothing about the kitchen or (single) bath, neither of which is pictured. I have to assume that they are more functional than stylish (after all, this is a "rare original classic artist loft"), i.e., that they will require an investment to upgrade.
Compared to #5R, I don't see #6F as commanding a higher value at a higher floor (more stairs) and lower level of finishes. So far (at least), The Market agrees. (The last sale before #5R in July, by the way, was #6R, which closed in October 2005 for $1.225mm.)
Let's see what The Market does to this one.
© Sandy Mattingly 2007
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