In Part II of a four-part series on house-hunting in New York City, the doctor looks at the good, the bad (and the ugly) of dealing with real-estate brokers, and the ins and outs of the bidding process.
In Part II of a four-part series on house-hunting in New York City, the Money MD looks at the good, the bad (and the ugly) of dealing with real-estate brokers, and the ins and outs of the bidding process.
Brokers: The Good and the Not So GoodA downside of looking for a home in New York City is not having a lot to choose from. Since some locations are more desirable than others, apartments that are for sale can go fast and inventory is often low. This is especially true of the Upper East Side and Upper West Side.
In addition, some brokers march to their own drummers -- not their clients’. This happened to me when my first broker went out of the city on vacation. Since I am in the city about 10 days a month, this was a problem. I didn’t know how to view available apartments when she was on vacation and the latter always seemed to correlate with my visits. In desperation, I called up brokers myself and saw properties on my own. This worked, but then I wondered why my agent should get a commission if I was doing all the work. I “poofed” her as my agent (as my grand-daughter would say) and found another broker from a different agency to help.
“Do you go to open houses?” was one the first things she asked. And, yes, I had. But at her urging I made a point to attend even more. You can find open house listing at the real-estate website StreetEasy.com.Saturday and Sunday are especially good times for viewings, as so many properties are available to see. This exercise gives comparisons of value for money, and is well worth the time.
The Art of CompromiseAfter looking at 18 or so apartments with the agent -- and 10 or 12 on my own -- it looked as if the ideal home was simply not available in my price range. So, adjustments had to be made. At this point, purchasing now seemed like a good choice.
By investing in real estate, the money is out of the tumultuous stock market. In addition, the apartment can be lived in and enjoyed. If the New York City market falls again, one’s personal financial situation can be reassessed. If the market improves, then our Manhattan upgrade can not only be enjoyed, but also we can rejoice about its increase in value.
The co-op we decided to bid on is in a building with a beautiful lobby, which is important to us. It also has a nice gym -- again a plus. Additionally, the problems in our current location outlined in the first column are solved.
What the home doesn’t have is the space my husband and I would like. Still, it is 333-square-feet larger than our present location. Also, the view from two rooms is excellent, though not all have direct light as our present co-op does. The point here is that unless one is very wealthy, there will be tradeoffs in buying a co-op or condo in New York City.
The Ins and Outs of BiddingWhat if real estate falls in New York and the buyer -- that would be me -- suffers regret? It doesn’t have to happen. Here’s why: I took the asking price, already discounted 10.4% since it has been on the market about three months, and figured in another 20% drop. That would be my starting bid. The seller didn’t go for it.
I decided my absolute highest offer would be what another apartment in the same building stack had sold for recently, though on a much higher floor, usually more expensive than those on the lower. Still, the seller didn’t budge. He said the higher place needed work and his didn’t. He had a point, so I gave in. This was in part because I was tired of spending time looking for properties but much more importantly, I thought it was the most superior co-op we had seen for the money. I offered the owner his asking price (that had already been discounted 10.4%).
Next Week: Part III: A Deal Suddenly Undone