6 Expert Tips for Winning a Bidding War in NYC
It’s no surprise that NYC real estate is one of the most competitive markets in the world, particularly for homebuyers. It happens all the time – you think you’ve found your dream home only to be informed that you’re in competition with other buyers. This may seem daunting, but not to worry.Below, the team from Prevu Real Estate highlights the key things you need to know to give yourself an advantage during a bidding war in NYC.How to win a bidding war in NYCOperate within your budgetEvaluate comparable salesBe flexible with non-financial termsPersonalize your offer with a letterBenefit from a commission rebateBuy all cash, take a mortgage laterOperate within your budgetBy the time you’re making an offer, you probably have a good idea of your budget. However, when encountering a bidding war NYC buyers can sometimes easily get carried away by their desire to win and lose sight of the bigger picture. Draw a line in the sand with your budget so that you don’t overextend yourself financially. There are plenty of homes in NYC. There will be other opportunities. Evaluate comparable salesMake sure your buyer's agent runs comps to justify the approximate value of the condo or co-op you are hoping to buy and evaluate that relative to the asking price for the apartment. It is important that you make an informed decision. As with any investment, you want to have a clear, well-research strategy to ensure you don’t let your emotions get the better of you during a negotiation.Be flexible with non-financial termsPrice and value are not the only points to consider when preparing your offer. Non-financial terms are a great way to make your offer stand out without having to dig deeper in to your pocket. A few examples of non-financial terms include timing of possession, flexibility on target closing date, and the option for a short-term lease-back. For sellers that want to sell their apartment but haven’t lined up their relocation, offering a short-term lease back can remove a lot of stress during the home sale process. In some cases, you will find that sellers prioritize flexibility with timing over a higher price.Personalize your offer with a letterWhether you have strong ties to a community, are a first-time buyer, or are experiencing a life event, telling your story can help create a personal connection with the seller. Writing a heartfelt personal offer letter about yourself and what buying that property means to you can position you favorably in a bidding war. Benefit from a commission rebateReceiving a commission rebate can provide additional buying power relative to your competition. At Prevu, we are a technology-driven, full-service brokerage in NYC, passes a significant rebate along to our customers. With Prevu’s Smart Buyer™ Rebate, you receive a commission rebate up to half of the commission Prevu receives for representing you as a buyer's broker. For example, if you buy a $2 million condo or co-op with a 6% commission (3% paid to seller’s broker and 3% to the buyer’s broker), your buyer commission rebate totals 1.5% of the purchase price. That’s a savings of $30,000 that you can use to help offset your closing costs or increase your buying power.Buy all cash, take a mortgage laterBeing an all-cash buyer allows you to seem like the better, safer option for a seller looking for a smooth transaction. If you are fortunate to have enough liquid assets sitting around to purchase the apartment all cash, its is not uncommon for wealthy buyers to purchase the property all cash and take out a mortgage after closing. This is sometimes referred to as delayed financing or a cash-out refinancing.For those buyers that are in the financial position to pursue such a strategy, it is best to speak to your mortgage professional and accountant to understand how much you'd be approved for in a delayed financing as well as any timing requirements to complete such a financing after closing.Interested in buying an apartment in NYC? Browse listings and see how much you can save with Prevu's Smart Buyer Rebate.
From Co-op to Condo: Working With NYC Property Types
Disclaimer: The contents of this article are industry best practices which were sourced from StreetEasy data and interviews with our Agent Advisory Board, unless noted otherwise. Any scripts provided are only meant to act as examples and are not required. Nothing in this presentation is intended to be legal advice. For specific questions about any duties or obligations arising out of a real estate transaction, check your local and state licensing laws and regulations, contact your broker, or an attorney.As an agent, you get to help people fulfill their dream of owning a home - and in NYC, that typically means a co-op, condo, or townhouse. To help your clients achieve their real estate goals, it's a good idea to understand these three property types, their unique markets, and how their differences impact the buying and selling process.What is a co-op?When a buyer purchases a co-op, short for "cooperative," they're actually purchasing shares of a corporation that owns the building. Typically, the bigger the unit, the more shares the buyer will own.What is a condo?Unlike with co-ops, a condo buyer purchases the unit outright and receives a deed of ownership. They also co-own the building's shared spaces, such as parking lots, elevators, pools, and hallways.What is a townhouse?A townhouse is a home that's attached on one or both sides to another townhouse or building. They are typically one- or two-family homes, and the owner is responsible for the entire structure.Market differencesCo-op marketAt any given time, the majority of homes for sale in New York City - around 75% - are co-ops. They're typically less expensive than condos, but buying one requires getting approved by the co-op board, which can be a challenge. Therefore, co-ops can be more difficult to buy and sell.Condo marketCondos tend to be more expensive than co-ops, but the approval process is less arduous. As a result, they're often easier to buy and sell. There are fewer of them in NYC, but whenever a new development is built, it's more likely to be a condo building.Townhouse marketTownhouses are one of the most sought-after property types, but there are few of them on the market and not all neighborhoods have them. This makes them highly expensive and competitive. There are also several different types of townhouses found in NYC, and the market can vary for each.Stay up to date on the latest market trends using StreetEasy's Data Dashboard, where you can filter metrics by property type (use "Single Family" for townhouses), borough, neighborhood, and more. Read our market reports, too, to get in-depth insights from our experts.Differences in the application processBuying a townhouse is like buying a traditional house in that there's no application or approval process. Co-ops and condos, on the other hand, do require applications - although there are major differences between the two.Co-op applicationsCo-op buyers have to go through a strict application and approval process. To start, they must submit an application and all required documentation, such as financial information, reference letters, and employment verification. This may be referred to as a co-op board package.Buyers then undergo an interview with the co-op board. A board may choose to reject a buyer for any number of reasons - from unsatisfactory financials to job history to simply "not the right fit." The entire process can take as long as several months.Condo applicationsThe application process for condos is far less demanding. Most buyers simply need to submit an application along with financial documents if they're financing. Condo boards do have what's called the "right of first refusal," which means they can override a purchase and choose to buy the condo at the same price, but few exercise this right.Maintenance fees vs. common chargesEach month, co-op owners pay maintenance fees, which go toward the building's operating costs such as insurance, staff, trash removal, and more. It also covers property taxes and any underlying mortgage payments. These fees are in addition to an owner's monthly mortgage payments.Condo owners pay monthly fees called common charges. They cover building operating costs, but they don't include property taxes; each condo owner pays taxes for their own unit.Subletting and pied-à-terre rulesCo-ops tend to have strict rules about whether owners can rent out their units or use them as a pied-à-terre (secondary residence). Some co-op boards ban subletting entirely, while others impose a fee or limit on how long a buyer can rent the unit out. Some co-ops allow pied-à-terres, but they may restrict owners from allowing others to live in their unit when they're not there.Condos, on the other hand, tend to be more relaxed on whether you can use your unit as a rental or pied-à-terre. However, they typically don't allow rentals shorter than six months.Closing costsFor co-op closing costs, buyers generally pay around 2-6% of the purchase price. Condo and townhouse closing costs tend to be higher due to mortgage recording taxes and title insurance. For any sale over $1 million, buyers must also pay a mansion tax, and the rate increases with the purchase price.What to expect when selling a co-op, condo, or townhouseSelling a co-op can be more complicated and take longer due to the approval process. They also tend to have strict open house rules, and some ban them entirely.Selling a condo is usually less complicated. But bear in mind that a deal can fall through if the condo association feels the accepted offer is too far below market value. Selling a townhouse is the least complicated since there are no boards to answer to, but fewer buyers can afford them.Whether you're selling a co-op, condo, or townhouse, be sure to take advantage of StreetEasy's Listing Insights tool. You can track your listing's activity over time, compare the property to others that have sold recently, and share the insights with your seller.NYC's fast-paced, ever-changing market can be tough to navigate, and your clients need your expertise to buy or sell successfully. By understanding the city's property types and their differences, you're better equipped to advise your clients and position yourself as their go-to agent.
What You’ll Get in NYC for $900,000
New York City still hosts the country’s fourth least affordable housing market, and buyers must carefully asses their budget and search criteria during the purchasing process. Buyers looking for larger apartments with multiple bedrooms can still find appealing options. The following units under $900,000 include in-unit laundry, private outdoor space, and stainless steel appliances. 120 Riverside Boulevard #4J Manhattan, NYPRICE$899,000BED1BATH1TYPECondoNEIGHBORHOODUpper West SideBOROUGHManhattanUpper West Side buyers can consider this spacious one-bedroom condo with floor-to-ceiling windows. Upon entering the unit, owners will find the galley kitchen with stainless steel appliances, a dishwasher, and light wood cabinetry. The large living room includes a coat closet and a hidden in-unit washer and dryer. Residents will appreciate additional storage in the bedroom and modern finishes, including a full bathtub in the bathroom. The building boasts multiple attractive amenities, including a state-of-the-art fitness center with a steam room and sauna, a media lounge with a projection screen, and a furnished rooftop with sweeping views of the Hudson River. Owners will appreciate their proximity to Lincoln Center, Riverside Park, and Upper West Side restaurants.27 Dodworth Street #4F Brooklyn, NYPRICE$895,000BED2BATH2TYPECondoNEIGHBORHOODBushwickBOROUGHBrooklynCouples and small families will enjoy the natural light and private outdoor space in this two-bedroom, two-bathroom condo. The main floor includes a living room with access to the private balcony and the smaller of the two bedrooms, which could convert into a home office. In the kitchen, stainless steel appliances, including a dishwasher, and a closet with the unit’s washer and dryer. Residents will walk upstairs to the primary suite, complete with a walk-in closet, private bathroom, and access to the private outdoor terrace. This outdoor space fits multiple pieces of furniture and provides city views. The penthouse unit is one of five condos in the building, offering a small and quiet community settled near Bushwick’s vibrant restaurants, nightlife, and entertainment. This unit just dropped in price and is available for under $900,000.110-38 64 Avenue #3635 Queens, NYPRICE$879,000BED3BATH2TYPECo-opNEIGHBORHOODForest HillsBOROUGHQueensFamilies can sprawl out in this two-story townhouse with lofted space. The large living and dining area offers space for plenty of furniture and receives natural light through six windows. Owners will appreciate the features of the contemporary kitchen, including stainless steel appliances, multiple cabinets, and an island with room for seating. The unit’s three bedrooms reside on the first floor, and the primary suite includes a private bathroom and two closets. Upstairs, owners can take advantage of plenty of storage space and use the home’s fourth room as an office, playroom, or other recreational area. This floor also includes a sitting room, three more closets, and a half bathroom. Throughout the home, residents will appreciate in-unit laundry, central air conditioning, and hardwood floors. This unit has a low cap rate of 2.79%.155 E 73rd Street #9B Manhattan, NYPRICE$850,000BED2BATH1TYPECo-opNEIGHBORHOODUpper East SideBOROUGHManhattanThis bright and expansive two-bedroom receives plenty of natural light that shines off the dark hardwood floors. The oversized living room in this unit stands out with plenty of windows, a fireplace, and a full wall of built-in storage. Multiple cooks can make a meal in the kitchen with stainless steel appliances, a dishwasher, and white cabinetry. Each bedroom offers two windows and storage space, with the primary bedroom boasting a walk-in closet. This pet-friendly unit resides in a 34-unit building with a part-time doorman, laundry room, and bike storage. Residents will live near Central Park, Upper East Side shopping opportunities, and restaurants.75 Henry Street #2F Brooklyn, NYPRICE$835,000BED1BATH1TYPECo-opNEIGHBORHOODBrooklyn HeightsBOROUGHBrooklynThe oversized kitchen in this co-op makes it appealing to cooking enthusiasts. When owners enter the unit, they’ll find the kitchen directly on their left, featuring stainless steel appliances, a pantry, and plenty of counter space with room for barstool seats. Off the other side of the foyer rests two closets. The open-concept living area includes large windows and a door onto the private balcony, which includes enough room for chairs and a small table. Owners can place a king-size bed in the bedroom and will appreciate the spacious walk-in closet. Throughout the unit, they’ll see hardwood floors and feel the central air conditioning. This unit resides in 75 Henry, a full-service building with a gym, indoor garage, and a planted terrace.The post What You’ll Get in NYC for $900,000 appeared first on RealtyHop Blog.
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