There has been some discussion among buyers and realtors on the recent Olive 8's reset pricing. When the video were announced two weeks ago, many were anticipating that the new pricing will be close to the auction prices. So, I decided to look up the numbers and make some comparisons on the reset prices versus the pre-auction closed homes and auction closed home. Here is a sample on the homes that I used for comparison:
As you can see, the reset pricing is between 13-23% lower than the previous listing prices but are still considerably higher than auction prices. If we look at the reset pricing versus the pre-auction closed homes, the prices are about the same if not slightly lower.
Related posts:
Olive 8's Video & Reset Pricing
Olive 8's New Pricing
Olive 8 Auction Results
Olive 8 & 5th and Madison Update
Olive 8 going Auction
I thought the auction prices looked reasonable but the new pricing not so much. I was getting interested but I’ll let others try to get a mortgage for 450 a sq. ft.
Go ahead and make an offer at a price you think is reasonable. Developers are accepting offers lower than the list price these days. I am sure there is room for negotiation in the listed prices.
Wendy,
I think your missing the point.
Of course the pre-auction prices were all over the place, but the auction sold all remaining homes on floors 18 to 26. Now, Olive 8 is trying to trick buyers into believing that prices are lower…but they are not!
Using your stats above, why would a buyer buy unit 2701 for $455,000 when unit 2601 sold for $389,000 and unit 2201 (carefully not listed in your stats) sold for $328,000?
I am in the market for a condo and the only development that seems to be transparent with pricing is the Escala. The sales team actually gave me a price print out of all the recently sold homes to compare pricing. Olive 8 wants me to believe that one floor higher should cost $66,000 or much more depending on the unit.
Wendy, why do you not see it that way?
I am starting to believe that this statistic twisting by realtors is done to remain subservient to Olive 8’s developer and his lawyer side-kick, and to Sotheby’s sales team? The real concern is why?
Hi Seattle-Buyer:
Thanks for sharing your thoughts. My goal for this post was to provide some interesting data for readers. I’m sorry I gave the impression I was advocating that everyone buy unit #2701 or any particular unit at the asking price. That’s a pretty complex decision and best left to readers and their agents or their own purchasing strategy if they’re buying solo.
With regards to your observation that the new Olive8 list prices are higher than the auction prices, I kind of thought I made that point when I provided the auction prices in the same table as the new listing prices. I also wrote, “As you can see, the reset pricing is between 13-23% lower than the previous listing prices but are still considerably higher than auction prices.”
I’m glad you’re looking at the most recently sold comparable prices as you consider Escala. That’s definitely a good thing to do; you or your agent should be doing that for all the buildings you’re considering as well as comparables for similar resale units in the neighborhood as well.
Hope this helps.
Wendy
Thanks Wendy! I do enjoy reading your website 🙂
When I was considering Olive 8 prior to the Escala really lowering their prices I had such a horrible experience working with the Olive 8 sales team and developer. It makes me furious how sleazy Olive 8 is and the new sales team just RE-WRAPS the old condos and prices and manipulates uneducated buyers with their marketing tricks.
Question for you Wendy (and Olive 8 staff if their reading): Why is the owner of Olive 8 purchasing units in Olive 8 under an LLC? Correct me if I’m wrong, but I believe he is attempting to create a “market value” above what is actually demanded of the current housing market. In buying his own units at unreasonably high prices, it looks as if they’re worth that much and allows his sales team to advertise as such. So, when a buyer comes along and believes comparable units to the one they are buying were purchased at higher prices (unknown to the buyer that it was the owner of the building who purchased them), this buyer would believe his is worth that much as well. Unfortunately, as the owner of Olive 8 cannot occupy the several units he’s purchased under his LLC, he will have to resale them once more units of Olive 8 are sold. Essentially then, pulling the rug from under those individuals who bought comparable units. Unfortunately for the general public, they cannot fact check this as the buyers are listed under the MLS. It would take an agent and a simple matching of the LLC’s office location with that of the building’s owner.
The developer has set up a LLC to develop this project. They own it through the LLC. When a unit is sold, it’s transferred from the LLC to an individual buyer.
Another important FACT is that some buyers “that I know” were able to purchase units at Olive 8 at a higher price and then the developer returned “Cash” to them at closing which gave the impression of a higher price sale.
Wendy,
Isn’t this illegal?
It’s not uncommon for seller to credit a small portion of the purchase price to the buyer at closing. It rarely exceeds a few percents and as long as the lender is fine with it, it’s not considered illegal. In the case of a cash buyer, i have seen bigger credit. As long as it doesn’t involve a lender, this is an arrangement solely between the buyer and seller.