July 23, 2017

Sellers Are No Longer Anchored To Irrelevant Pricing

A report from Realtor.com on California. “Stephen Curry isn’t used to losing—at least, on a basketball court. But in the realm of real estate, this Golden State Warriors point guard proved that not all he touches turns to gold when he recently sold his home in Walnut Creek, CA, at a loss. In November 2015, Curry and his wife bought the mansion for $3.2 million. Then the couple poured an additional half-million into renovations. A year later, they put it back on the market for $3.7 million. But apparently they’d set their sights too high, because it sat warming the bench with no takers. Finally in July of this year, the home sold for the lowball sum of $3,195,000—more than a half-million less than what Curry was hoping for and less than what he paid for it almost two years earlier.”

“The luxe market had begun to level off right when Curry made his purchase—and then move downward by the time he was ready to sell a year later. ‘Curry paid top-of-market prices in 2015, as that’s when the market really peaked,’ says Cara Ameer, a Realtor in Florida who often handles property for professional athletes. ‘It has taken a bit of a downward trend since then, and the luxury market has been more challenging to sell since some of the foreign money has dried up.’”

The Real Deal on Florida. “Sellers are finally getting realistic about pricing, and the result is a far more robust residential market. In Miami Beach, for example, sales were up for the second consecutive quarter after three years of declines. ‘Sellers of high-end real estate are more in sync with reality than they have been in the past,’ said Jonathan Miller, who authors the Elliman reports, either reducing their prices or letting some listings expire.”

“In Miami Beach, the median sale price fell by 5.9 percent to nearly $409,500 for all residential properties, compared to $435,000 a year ago. The median condo sale price fell by 4.9 percent to nearly $365,000, and the median sale price of a single-family home price dropped year-over-year by 12.5 percent to $1.4 million. The median price of a house dropped 7.1 percent to $405,000 in Delray. Across the board, the median price of a single-family home in Palm Beach was $4.2 million for the second quarter of this year, down 6.7 percent from the previous year.”

From Greenwich Time in Connecticut. “Greenwich home sellers are getting more realistic about their pricing, according to Jonathan Miller of Miller Samuel Real Estate Appraisers and Consultants, and that’s a big positive for the market, he said. These statistics stem partially from sellers who are no longer ‘anchored to the value of their homes from what they paid for it before the financial crisis,’ he said, adding home values from before 2008 should be considered ‘irrelevant’ to pricing now.”

“Sellers are changing their tune with pricing mostly because of time, Miller said. Many of last quarter’s luxury sales, which began at above $4 million, ‘have been on the market for a number of years,’ he said.”

From Realtor.com on New York. “A prime location overlooking Manhattan’s Central Park.A 7,000-square-foot apartment with 15 rooms, 11-foot-high ceilings, and a private elevator. A place with such features practically sells itself, right? Well, there is another not-so-small detail: the price. When it landed on the market in April 2016, the luxury apartment in the prewar building at 1060 Fifth Avenue on the Upper East Side was priced at $65 million.”

“With no buyer committing to the 10th-floor, six-bedroom, six-bathroom condo at that high price, co-listing agents Jenny Lenz and Dolly Lenz have drastically cut the price to $38 million, reigniting interest in the luxe home. Lenz explains the reasoning for the price drop with the recent sale of actress Demi Moore’s New York City penthouse after a few years on the market. ‘She started out at $75 million and ended up at $45 million,’ Lenz explains. ‘One number is a nice idea and maybe could work—and the other is the number that actually does.’”