Rot Starts at the Top End: "Sweet Deal" on $19 Million "Discounted" NY Condo?
The New York Post reports Penthouse's $19 million discounted sale is a sign of a weak market.
A sprawling triplex penthouse at 12 E. 13th St., which once asked as much as $30.5 million, has sold for $11.5 million, according to city records filed Wednesday.
It first listed for $28.5 million in 2013, StreetEasy shows, only to have its price climb to that $30.5 million in the following months.
In 2016, after a year and a half off the market, the penthouse returned with a $20 million ticket price — and subsequently had four price cuts to its most recent $12.95 million ask.
This triplex is an example of the softening condominium sales market at the high end, in which new development does not sell for its aspirational prices.
Despite the hefty discount, the buyer — whose identity is shielded in an LLC — got a sweet deal. The property features two 906-square-foot terraces, as well as a three-story glass wall that lets in natural light, a private internal elevator, four bedroom and a kitchen with professional-grade fixtures.
Sweet Deal? Weak Market?
It's only a "sweet deal" if the buyer can sell it for more at a later date or if it meets some urgent need right now and price does not matter. Someone buying a $10 million condo may not care whether or not they have a future gain or loss.
Stories that list "ask" prices without previous sale history provide no real information. $10 to $30 million homes do not flip that often so we do not know if the previous buyer has a gain or a loss.
That said, I suspect the "weak market" theory is correct.
Real Estate Rot Starts at The Top End
In most markets, rot starts at the periphery and eats its way to the core. With real estate, price discounting starts at the top and works its way lower.
It's highly likely we have seen the peak this cycle at the top end. The stock market is starting to crumble and other asset prices are likely to follow.
Mike "Mish" Shedlock