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
don’t blame it all on obama years, the ponzi spigot was opened decades ago
It is a sweet deal if you are simply planning on living there, and can afford what you paid for it.
Zero Hedge headline: “Warren Buffett Is Now America’s No. 2 Real-Estate Broker”
“Real Estate Rot Starts at The Top End. In most markets, rot starts at the periphery and eats its way to the core.” In other words, it is not confined to super prime.
Well, during the time it has fallen in price from $20M to $11.5M, a house in Silicon Valley that I was looking at has gone UP from 1.4M to 1.9M
Yes, they may all be overvalued. But it is hard to call the top. Who knows, the SV house could go to 2.0M or even higher in the next year…
@AWC
For you it was an investment. Hard work. Long hours. Make Cash flow work. Etc.
To those in RE today – it is a get rich scheme with little to no thought. Buy, buy, buy. RE always goes up! Everyone wants to live here! Rich Chinese! Leverage, leverage and more leverage. Flip! And flip some more? Positive cash flow – what the heck is that?
And it will end badly and people will cry they are victims.
When it was all greed driven by cheap and easy obama debt.
Except for a few holdouts – those days are over.
Toronto, NYC, Miami, London and many others all have shown some drastic DEpreciation over the last year. Nearly all other major cities are flat.
Yes – a few CA cities still appreciating at the 6-8% rate. Doubt it will last much longer.
So the worst of all worlds. A depreciating asset that you can’t sell to cover your costs and yet has YUGE holding costs (the alligator like to eat every month).
++++++
“Otherwise, the sellers will just sit on the appreciation, running at around 6-8% these last couple years”
They didn’t forget. Cheap and easy obama bucks just made it so it didn’t matter.
+++++
Evidently some people forgot about what happened in 2007 and 2008. History repeats itself.
Evidently some people forgot about what happened in 2007 and 2008. History repeats itself.
I was reading stories about this 4 years ago. if I remember correctly, top priced Manhattan RE prices fell from 2005 to 2010 or 2011, then started to recover, flattened out int 2013 and started falling in 2014 slightly. Harder hit was Emerald Isle, NC, where I spent the winter of 2009 a place where lots of mid management New Yorkers owned vacation properties. Seemed like about 30% of the homes along the ocean were for sale or foreclosed.
Note quite the entire picture
The seller has been trying to sell since 2013.
That is FIVE years of taxes, HOA fees, insurance, utilities, tipping the doorman, etc.
Just guessing – that is easily another million dollars right there.
But it was cheaper than renting!!!!