First, as per usual, I would like to thank everybody for helping us become such a tremendous success! I still fondly remember the early days of The Burkhardt Group: quite a few clients were as of then finding the brokerage community as still something to be desired. Many clients were very skeptical of our new open and transparent model that utilized rebates. One client stood up at closing and demanded his check before we went any further 😆. Another told me there was a pool in his office betting on whether or not we would hand over the large six-figure rebate check or not! We've certainly come a long way from those trepidatious times...
As always, I typically put out a synoptic note around the second or third week of January, which is usually when I can get a feel for what's happening for the year. This year, however, I've waited a bit longer. As many of our clients who have purchased over the last six months now know, the market shifted in favor of buyers. Not only has it been easier to transact during that time, but we've seen some pretty sweet deals as well. While the buying momentum has continued into January and to some extent is continuing today, there has been an overall shift to a firmer market. We are coming off one of our busiest late January-February months since I started TBG. In layman's terms: we've been slammed! We have seen some significant discounts in new development deals coupled with concessions. We've also seen some solid deals on re-sales of both co-ops and condos. Brooklyn has remained relatively strong, especially the two bedroom market under $1.5M. Believe it or not, we're still seeing bidding wars on many of these units!
We are especially seeing some good opportunities on units that were initially mis-priced as the market was first starting to decline back in the middle of last year. Many of those sellers were looking at comps from the previous 6 to 12 months and wanted what their neighbors achieved. Buyers were not making any concessions though and made them pay the price. By the time we got to August, we were in a full-blown buyer's market and property that remained overpriced languished for months, so you wound up with stale bread (and no one wants stale bread). We still found some good opportunities in these properties.
In the present moment, I feel like we're dealing with a fairly well-balanced market. Sales are taking place at a measured pace for both buyers and sellers. Properties are selling based on their merits, not on emotional hyperbole. Buyers should continue looking for deals, exercise patience and make decisions based on the assumption that prices are down between 10 to 20% from the peak of 2014 (depending on location and property type). In some recent cases, we've seen properties trade at 2014/2015 purchase prices with sellers 'only’ losing transaction costs. I have been dumbfounded by a few property trades that greatly exceeded my own estimation of value. One was a co-op loft space in Williamsburg that quickly achieved its asking price of $1350 square foot and was in need of a gut renovation. Some sellers are also starting to draw the line on what they're willing to accept. For instance, a recent offer we made on a very nice high-floor one bedroom in downtown Brooklyn was not countered, even though it's been on the market 140 days. We were looking for a 10% discount versus the currently reduced ask, of course we will continue to follow that one.
Our sell-side business has continued to be a success and why shouldn't it? We offer a complete full-service business model with a reduced commission scale. The maximum commission you will pay is 3.75% (2.5% to buyer agent,1.25% to us. 2.5% when there is no buy-side agent). Remember, this pricing is reflective of full-service experience that includes photos etc. We will always provide you with a detailed analysis and valuation of your home based on our market knowledge and all pertinent data. We won't make promises that we know we can't keep regarding achievable sales price-we've sold every listing that we've taken on in less than 30 days at asking price, or very close to it.
When you understand the listing process and how that market works, then you will know that the ‘brand’ you list with is not particularly vital. What is important is getting the price right, getting the home listing-ready and making sure it's in the RLS and Streeteasy. All buy-side brokers look for listings in the same place: the RLS. All consumers look for listings in the same place: Streeteasy. After the basic plans are implemented, all you need is an articulate broker that is willing to put the work in to competently show and handle a negotiation. One of my biggest pet peeves with listing agents is their lack of preparation leading to incorrect information regarding the property they're handling. We go above and beyond to make sure we have all the facts pertaining to the property at our fingertips. Starting with current financials, offering plan with all recent amendments, correct carrying charges and maintenance fees, sublet policies, assessments or planned capital improvements etc. We have seen (and many of our buyer clients will attest to this), the lack of preparation even from some of the biggest names in the brokerage business. For a full explanation of how the listing process works and what we offer, please don't hesitate to call us.
We have a pretty good grasp of the present situation, but what does the future hold? I think we will continue to see a balanced and healthy market for the remainder of 2019. Some financial pundits are saying this will be the year of the stock picker. I think that's a good analogy to apply to the real estate market: choose wisely and be patient. What will be interesting is observing the last quarter's numbers coming out onwww.Urbandigs.com soon. At that point, we will be able to evaluate if what I'm experiencing is matching up with the overall market data.
Thank you again for all your kind referrals! We will do our best to take care of them just as we've taken care of you. After all, we are still a 100% referral driven business! We have had a great year last year, again thanks to all of you! And ideally you're staying in your home for 7+ years, so no reason to stress out over these cyclical ups and downs. Enjoy your home!!
Please feel free to call me to discuss anything real estate.
Best,
Keith
917.770.4951
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