New development discounts are at the highest level in years

Developers keep slashing prices amid the glut

TRD New York /
Oct.October 08, 2018 10:00 AM

(Credit: iStock and Pixabay)

Condo discounts are getting deeper.

As sales have slowed and buyers are shopping around, developers are slashing prices at a rate the market hasn’t seen in years, the Wall Street Journal reported.

The market reset, thanks to an abundance of supply, is driving down prices. At the same time, the number of closed deals has also slid. In the third quarter, new development sales were down more than 30 percent compared with the same quarter in the previous three years, the report said.

“Everybody today comes in and expects a discount,” Ziel Feldman, chairman and founder of HFZ Capital Group, told the Journal. He has half a dozen condo and co-op projects on the market.

The share of listings in new buildings with price cuts of at least 5 percent has grown during the past five years — to 8.7 percent, the highest figure since at least 2012, the report said.

Developers increasingly are also agreeing to take on closing costs, including the city and state transfer taxes of 1.825 percent usually paid by new condo buyers, the report said. And, in some cases, brokers who bring in buyers are offered a higher commission of 4 percent.

Some see it as a positive shift for the market. Douglas Elliman’s Frances Katzen said there’s no longer “shock and horror” over price cuts. “It bodes well for the market,” she said. [WSJ] — Meenal Vamburkar

Related Articles


Real estate stocks push up this week as U.S.-China trade tensions ease

416 West 25th Street and Maverick Real Estate Partners principal David Aviram (Credit: Google Maps and LinkedIn)

Chelsea landlord claims “predatory” lender is charging a crippling interest rate as punishment after losing foreclosure case

Brokerage firms are strategizing ways to make up losses after the cost of application fees was capped at $20. (Credit: iStock)

Brokerages on rental application fee cap: “It hurts”

Alex Rodriguez (Photos by Guerin Blask)

A-Rod is coming for NYC and SoFla real estate

Joel Schreiber (Credit: Shir Stein and Wikipedia)

WeWork’s first investor used his stock as collateral. Now his lenders are suing him

There will be 70 agents based at the new office (Credit: iStock)

Compass opens Long Island City office as new-development sales surge

The Daily Digest - Tuesday

New life for Toys “R” Us, Masa Son is “embarrassed” with the Vision Fund: Daily digest

Nooklyn CEO Harley Courts (Credit: iStock)

Brokerage slashes agent commissions, delays payments after rent law change