Tweet
Hi there, a friend of mine shared the below methodology with me for a potential offer on a new construction apartment located in Manhattan. Numbers and names have been changed around, but has anyone else seen offers being priced in this manner? I think this may be too precise for what is an imprecise and illiquid market:
I did some research on the offer price. I used two approaches to analysis the price:
Based on this analysis, I would like to put two offers: 879k for 10D and 875k for 9D. If it sounds reasonable to you, please let me know the next steps.
I did some research on the offer price. I used two approaches to analysis the price:
- Check the Zillow Price Index for Manhattan at the point of last sale and Oct 2018 (say we get number A1 for last sale and A2 for Oct 2018). Calculate A2/A1 and we get a correction factor F1. Repeat the same thing for StreetEasy Price Index for Manhattan and we can get another correction factor F2. The offer price is calculated by (F1+F2)*Price of last sale. With this approach, I got $875,048 for 9D and $879,221 for 10D.
- I pulled all sales data for D line from 5D to 14D . From their last sale price, I get a comparable price by multiplying a factor (The factor is derived from Zillow and StreetEasy Index). With this approach, I got $879,874.
Based on this analysis, I would like to put two offers: 879k for 10D and 875k for 9D. If it sounds reasonable to you, please let me know the next steps.