Anything for Money

Everyone in real estate seems to have a different forecast for this winter. But whether we’ll get a mild chill or a full-on ice storm, everyone agrees it’s going to be a long, hard winter on Park Avenue. The super-luxury market – property selling for $3 million and up – is frozen solid. And sellers who expect to get pre-September 11 prices are getting a blast of cold air. “Unless you’re in the ballpark,” says one broker, “buyers are going to ignore you or offer half the asking price.”

So sellers are coming up with new ways to generate heat, or at least bundle up until things improve. “There’s definitely an increase in We’ll just rent it out instead and sell in a few years,” says Jed Garfield, of Leslie J. Garfield, a firm specializing in townhouses. Indeed, one broker says more pricey for-sale properties are up for rent – notably downtown – than he’s seen in a decade. At this level, however, renting can be as intimidating as buying: One house is listed at $38,000 a month, to minimal interest. “The asking rents just seem too high,” says Roger Erickson, of William B. May.

Putting a property up for bids is another option. While many brokers dismiss auctions as “circuses,” the auction house Sheldon Good & Company will send ten to fifteen New York-area “trophy homes” under the gavel in the next six months, up from only two a year ago. Indeed, they just offered a seven-story East 68th Street townhouse, listed for months at $12 million. The opening bid fell to $10 million – and still drew no buyers.

The most obvious strategy, of course, is to lower one’s price, but even deep cuts don’t seem to be working. Anne Snee, Corcoran’s director of townhouse sales, ticks off examples: a house marketed at $15 million and then reduced to $10 million; another down from $16 million to $14 million; a third that sold for $12.9 million only last year that’s now on the market for $10.9 million. Another broker has a property that started “at 6.9 and then came down to 4.5. It’s still not sold.”

Still, not everyone in the upper sliver is feeling the chill. One cool-headed seller told his broker, “I’d be delighted if we sell, but if not, I’m happy that my resources are parked in blue-chip real estate on Central Park West.” Anyway, adds Jed Garfield, “it’s not that rich people don’t need the money. They just need it less.”

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Anything for Money