Off-Market Sale May Be No DealPosted on Thursday, September 1st, 2011 at 8:50pm.
Buyers dissatisfied with the public offerings seem to rush to see the off-market options when they hear about them. Hope springs eternal that there's something better over the horizon, or off the radar.
Here's the thing about an off-market property: You could overpay, maybe by a lot, for the privilege.
|2212 Manhattan Ave.|
If that sounds like a bubble-era price for a not-so-big TH, it should. That's because the same TH traded when new 4 years earlier, in April 2007, for $2.450m.
Who gets a markup these days over April 2007 prices?
The very question seems so absurd, we won't even research it. We'll just answer: No one does. Let's see if someone wants to contradict that.
Looking at recent trades all over MB, you'd expect to see a rewind of 10%-20% or more on a 2007 purchase reselling here in 2011. We provide examples every week.
But somehow, there was no rewind at 2212 Manhattan Ave., a spot magically isolated from the last 4 years' price declines.
Let's look at a more direct comp. That'd be the newly closed sale at 2211 Bayview. This TH, directly attached to 2212 Manhattan Ave. and right up behind it, was built at the same time as part of the same 4-unit set of THs. Style and size are the same – well, it's very slightly bigger (4br/4ba, 2660 sq. ft.).
|Ocean Views from 2211 Bayview|
The layouts of the two attached TH's appear to be identical, or nearly so – they both feature a top level with the same layout. For the record, though, we haven't seen 2212 Manhattan Ave. – and we probably won't be invited over any time soon after this story posts.
Now you're wondering, if Bayview has the bay views, isn't that unit worth extra money?
Not according to the public market.
2211 Bayview originally traded for slightly less than 2212 Manhattan: $2.370m in Sept. 2007, or a (nearly trifling) total of $80k less than the front unit.
When Bayview hit the market this year at $2.299m, they cited the off-market sale in front as evidence for the price. But the market didn't buy it.
2211 Bayview just sold for $2.065m, a drop of $305k (-13%) from 2007, and a full $435k (-17%) less than the front unit sold for off-market just a few months ago.
So next time you're shopping for off-market properties, ask yourself this: Am I getting a deal? Am I overpaying? Am I overpaying by 17%, as if the last 4 years never happened?
Do we need to say it again? Buyer beware.
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