Showing posts with label views. Show all posts
Showing posts with label views. Show all posts

Apr 7, 2014

Determining Price Differentials for Floors & Views

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A seller recently asked what is the price differential for each floor in a Manhattan apartment building?

In Manhattan there are many variables in determining the price differential for each floor. A beautifully renovated apartment on a lower floor can sell for a higher price than an "original condition" apartment on a high floor.

The parlor floor in a townhouse may be worth more than the 4th floor if it's a walk-up. A 10th floor apartment facing the back will sell for less than the same apartment on the 5th floor directly facing Central Park.

Unless the building owns the air rights over neighboring buildings, views can and will change in Manhattan. A high floor facing an interior courtyard doesn't have as nice a view as the corner apartment on a low floor overlooking the park. Higher floors usually have a premium as do views. Both premiums can be separate. A view can be subjective. However, kitchens and bathrooms can be replaced but there is only one Central Park and Hudson river in Manhattan.

When pricing or determining value of a Manhattan condo or coop it is crucial to compare apples to apples. All coops and condos in Manhattan have an offering plan.

In the original offering plan whether new construction or conversion, the developer/sponsor put a price differential for each floor and unit in the building.

The sponsor determined premiums for each unit. Since all offering plans are from different years and during different market conditions there is a premium percentage for every attribute. In a coop, premiums for attributes are also allocated with more shares in the corporation.

Think in terms of percentages rather than arbitrary dollar amounts.

For example, if you're considering purchasing or selling in a building that was built or converted in the 80's, you can figure out the approximate percent of the premium.

If the same apartment, line, and square footage was selling in the $200,000 range originally and today the same apartments are selling in the $800,000 range, the apartment today is worth 4x more. If they're selling in the million dollar range 5x.

The premium for floor differential is 4x more whatever it was in the offering plan. If it was $2000 per floor in the offering plan, than it would be around $8000 per floor today providing the comparable apartments are otherwise the same. Price per share (in a coop) and price per square foot can also be used as evaluation tools. However, all square footage is not equal.

In today's transparent information age there are many online tools or "gimmicks" designed for automated instant home values. Take them all with a grain of salt. An algorithm looks at data logically. Real estate data isn't always logical. Selling and buying real estate is emotional not logical.

In Manhattan pricing a home is as much an art as a science.

Pricing a home is a marketing function, the price you get is a function of the marketing you choose.


Oct 6, 2010

Price per Floor in Manhattan Condos and Coops

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A buyer and seller recently asked what is the price differential for each floor of the same line in a Manhattan apartment?

In Manhattan there are many variables in determining the price differential for each floor. A beautifully renovated apartment on a lower floor can easily sell for a higher price than an "original condition" apartment on a higher floor. The parlor floor in a townhouse may be worth more than the 4th floor if it's a walk-up.

Views tend to be better on higher floors but that is not always the case. Unless the building owns the air rights over neighboring buildings views change in Manhattan. Higher floors usually have a premium as do views. Both premiums can often be separate. When pricing or determining value in Manhattan it is crucial to compare apples to apples.

All coops and condos in Manhattan have an offering plan. In the original offering plan whether new construction or conversion, the developer/sponsor put a price differential for each floor and unit in the building. The sponsor determined premiums for each unit. Since all offering plans are from different years and during different market conditions, I like to think in terms of percentages rather than an exact number.

For example, if you're considering purchasing or selling in a building that was built or converted in the 80's, you can figure out the approximate percent of the premium. If the same apartment, line, and square footage was selling in the $200,000 range originally and today the same apartments are selling in the $800,000 range, the apartment today is worth 4x more. If they're in the million dollar range 5x.

The premium for floor differential is 4x more whatever it was in the offering plan. If it was $2000 per floor in the offering plan, than it would be around $8000 per floor today providing the comparable apartments are otherwise the same. Million dollar range $10,000 range per floor.

In today's transparent information age there are many online tools designed for automated instant home values. Take them all with a grain of salt.  In Manhattan pricing is as much an art form as a science. Pricing is a function of marketing, the price you get is a function of the marketing you choose.


Sep 8, 2006

How Much Would You Pay For A VIEW?

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View from Apt. 20A at 377 Rector Place BPC

In May 2003 a study was conducted by Michael H. Schill, director of the Furman Center for Real Estate and Urban Policy at New York University; Jonathan Miller, president of Miller Samuel, millersamuel.com a leading Manhattan appraisal company; and Ioan Voicu, a research fellow at the Furman Center. nyu.edu

The study looked at attributes and ammenities in features ranging from the age of building, fireplaces, terraces, condos vs coops, views, financial requirements, square footage, doorman etc. and gave each a premium.

The study found there is a 15% premium for condos over coops. Some say there is a premium for condos because they are easier to get into. A prewar condo has a 30% premium because they are so rare.

The study found old is in - the older the better. I think that is changing as more and more buyers are demanding the ammenities and views in new condo developments.

There is about a 10% premium for a Fireplace a status symbol of old New York. Balconies and terraces a premium of about 9%. Even if never used everybody wants them.

A good view 3.6% and excellent view 7.99%.
I have seen two listings of the same apartment - one facing the back of a building and the one with the view listed for 50% more. Both priced right.

A view is subjective. A good view is subjective. What is a good view? what is an excellent view? a breathtaking view? a spectacular view?More and more buyers seem to want views. How much is it worth to you?
 
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