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12Apr

[Press] Leftover lowballing: Brokers counsel against too-low offers

Posted by gerwin /
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With the spring selling season kicking into high gear, brokers are up against an unwelcome obstacle: uninformed buyers who insist on submitting lowball offers.

Last month, brokers said they struggled to educate buyers accustomed to controlling the market — some of whom made bargain bids on reasonably priced properties — that the spring season is a different beast. New apartment hunters are in the mix, and inventory is still down in most parts of Manhattan.

“Buyers still think they have the power going back to when the market crashed —more if they have all cash,” said Jennifer Zucher, a senior vice president at Plaza Real Estate Group, who added that dealing with buyers who continue to offer 20 percent below asking price was the biggest impediment to closing a sale last month.

“In reality,” she said, “the owners are getting back more power, especially if they are in desirable locations.”

The numbers reflect some — but not all — of that sentiment. In the first quarter of 2012, the number of Manhattan co-op and condo sales increased 14.9 percent compared to the previous quarter, rising to 2,311 sales from 2,011, according to Prudential Douglas Elliman data compiled by appraisal firm Miller Samuel. But year-over-year sales have dropped 3.5 percent.

On the whole, average and median sale prices have budged less than 1 percent compared to the same time last year. Last quarter, the average sale price was $1.34 million, a 7.2 percent drop over the previous quarter. The median sale price was $775,000, a 9.4 percent quarterly drop.

…..Still, not everyone encountered uneducated buyers. Sandy Edry, a senior vice president with Keller Williams NYC, said he has encountered buyers who are adjusting to the current market, even if they are still on the lookout for deals.

He said that the biggest challenge of the past month has been dealing with renters who were considering buying, but then reevaluated.

“In other words,” he said, “they are tempted to make the leap into homeownership and they even go as far as putting in offers, but then the nerves set in and I get the call that they’ve decided to rent for another year. Oh, well.”

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