High-end buyers in New York should expect price concessions or, at the very least, sales and transfer taxes to be paid for by developers thanks to a glut of luxury properties on the market.
Don’t get too excited, Mansion Global found that price concessions are small, but these little cuts are the norm right now.
“These aren’t the dramatic price reductions that people might think are happening, but there is some negotiation on price,” said Douglas Elliman Development Marketing’s Susan de França to Mansion Global. According to her, 3 to 8 percent concessions can be expected at the moment.
Though some developers with a starchitect design or a premium location are unmoved by buyers’ efforts to negotiate, most developers recognize the high-end market has shifted in favor of the buyer. De Franca noted a larger concession was more likely on a $10 million price tag than a $1 to $3 million deal.
Other concessions to look out for include some developers being willing to pay sales and transfer taxes for buyers — usually around 3 percent of total purchase — and, on the brokers’ side, some developers are increasing commissions to up to 4 percent to incentivize brokers to bring in their clients. De Franca also pointed out a growing trend where developers pay progress payments to brokers ahead of the closing.
“Over the years, I’ve seen this sort of thing happen, but when the market gets stronger, it immediately goes away,” she told Mansion Global. So, seize the day — and concessions — while the getting is good.
[Mansion Global] — E.K. Hudson