Responding to a Less Heated Market

By CHRISTINE HAUGHNEY
Published: March 9, 2008

NEW YORK CITY real estate has become a shadow of its frenzied former self in recent months, as buyers and sellers take a more deliberate approach to reaching deals.
Some sellers have pulled their apartments off the market for now, in the hopes that they will have better luck in the traditionally more robust spring season, which typically begins in April. Others have pulled out altogether, thinking it would be better to wait for a year or more to get the price they want. Sellers who really need to sell now are finding that they have to work a lot harder to attract buyers.
Many sellers, it seems, are discovering that they have to spend some money to spruce up their apartments before they can sell them. In fact, the decision on when to sell is often based on how much work needs to be done. Some sellers are tackling long-term plans, like carving an extra bedroom out of existing space, while others are making quick fixes, like replacing light fixtures and switch plates.
In the end, overall prices are stable or even rising, and the properties that are selling are priced just right or have sellers who are willing to negotiate.
“There’s definitely always that sense of fear that we may not sell it or that we may have to drop the price,” said Christopher Lauretani, who, with his wife, Maria, is trying to sell their two-bedroom on the Upper West Side.
The couple want to sell because they are sharing a bedroom with their 10-month-old daughter, Gabriella, and they want to be settled in the suburbs by the time their 3-year-old son, C. J., starts kindergarten.
But they are approaching the process very differently from when they bought their apartment, at 2166 Broadway, at 76th Street, in 2004. As buyers in a boom market, they didn’t worry that the kitchen needed renovations, and they paid more than the asking price just days after the place went on the market.
“It was a frenzy when we bought it three and a half years ago,” Mr. Lauretani said.
This time, as the sellers, they’re giving themselves 18 months to find a buyer. They had already meticulously renovated the space, but they repainted anyway. They believe the apartment, with two bedrooms and two baths and a large terrace, is priced competitively at $1.2 million.
But after more than a month on the market and no offers, their broker, Elaine Clayman of Brown Harris Stevens, advised them that an “active but not frenetic” market requires patience. They’re still adjusting to these new conditions.
Brokers and researchers say the current low inventory in New York City could help the city withstand the problems that have plagued much of the rest of the country, where inventory is high.
In January, Manhattan had just 5,641 apartments for sale, compared with 7,640 at the height of the market in the second quarter of 2006, according to data tracked by the Manhattan appraisal company Miller Samuel Inc.
At the same time, the inventory of for-sale apartments is soaring nationally. There were 4.19 million homes for sale in the United States in January 2008 compared with 3.54 million in January 2007, according to the National Association of Realtors.
Diane M. Ramirez, the president of Halstead Property, said that these conditions are making New York City a healthier market. Sellers are working harder to get buyers, and buyers aren’t distracted by too many choices. Both sides appear willing to make deals.
“The inventory is part of the reason that’s keeping the market so strong,” Ms. Ramirez said. “There’s so little choice. Excess inventory is always going to drag your prices down.”
Sellers who do their homework are finding that their efforts can pay off.
Carolyn Walkin and her husband, Jim, wanted to move to the Long Island suburbs to find better schools for their daughters, Ava, 4, and Veronica, 2. But they were so worried about a potential recession that they did extensive research to ensure they could sell their three-family brownstone on Henry Street in Cobble Hill, Brooklyn, for the price they wanted.
Ms. Walkin spent about five months and had conversations with at least seven brokers before choosing Terry Naini of Prudential Douglas Elliman. Before that, she had also researched auction houses and considered selling the brownstone without a broker.
Even though they finished an extensive renovation two years ago, they added details like art on the walls to attract sellers. Within one hour of their first open house, they received an offer for their asking price of $2.5 million. But Ms. Walkin didn’t relax until the paperwork was signed.
“I wasn’t confident that I was going to get the price I wanted to ask,” she said. “I believe we timed it well.”
Some sellers are looking for ways to get their price, even if it means waiting a year.
In 2005, Justin and Lucia Muntean bought a two-bedroom condominium at 227 East 111th Street for $650,000. Back then, they expected to live in their apartment, in East Harlem, for two years and sell it for $850,000 to $925,000, Mr. Muntean said. When they put it on the market in August, however, they asked $799,000.

FULL ARTICLE:
http://www.nytimes.com/2008/03/09/realestate/09cov.html?_r=1&oref=slogin