By Katherine Chang
Fenwick Keats Real Estate
As we left 2013, soaring apartment prices were a prelude of things to come in 2014 for the New York City real estate market. The market has not skipped a beat since then and continues to be a sellers’ market. Manhattan has led the pricing surge; we find sellers have even increased their asking price after the initial listing due to the demand they receive from the market. Inventories have dried up and the tight market exists across the condominium and cooperative property spaces. Bidding wars are leaving many buyers frustrated and empty handed.
To purchase an apartment in Manhattan as well as many other parts of New York City, buyers must learn to follow a few guidelines to stay on the competitive edge.
Be financially prepared. Cash is king.
➢ Over 90% of deals are being swept up by cash-only buyers who are also willing to bid higher than the asking price.
➢ If you’re not an all-cash buyer, make sure to do your homework and have mortgage approval ready. A buyer with all of their financial paperwork organized and ready is much more attractive to a seller.
➢ Know your math. Know what you’re willing to spend and understand that most properties will get at least their asking price.
Time is opportunity lost – know what you want
➢ Many buyers tend to waver on a property they like; by the time they make a decision, there may already be 4 or 5 offers on the table.
Be willing to compromise
➢ Buyers need to understand that they will not get 100% of what they want in a property so they will have to learn to prioritize their needs.
➢ In this market, sometimes willingness to renovate an outdated kitchen or bathroom will put a buyer in a better position to purchase the apartment in a perfect location.
Don’t give up
➢ Many buyers will get frustrated after losing out in a bidding war; understand that you’re not alone and this is part of the process.
➢ Practice makes perfect
Gone are the days of 2012 where listings lasted for many months and closed 2%-5% below asking. In the current market, we frequently see properties lasting no longer than a week before receiving a signed contract. Today’s market is full of serious buyers, either with great finances or cash-only investors, and the market doesn’t seem to be cooling down. Before entering the market, buyers need to educate themselves and partner with a buyer’s agent; someone who can educate them and walk them through the entire stressful process. It takes complete preparation and a little bit of luck but New York City real estate is still a very attainable dream.