Friday, October 16, 2009

What Does a Doorman Cost?

The north east end of Hoboken is punctuated with luxury buildings. Are the amenities, such as doormen, worth it to you as you assess where to invest for you and your families future? Let’s see what historic sales data can tell us.

What does a doorman REALLY cost? Two bedroom units that sold in 2008 and 2009 with a doorman sold for 75% MORE than units without doormen, translating to a greater than $100 per square foot differential. One bedroom units with a doorman are actually seeing a better premium in price in 2009 versus 2008, with a lift of 62% higher sale price than non-doorman buildings in 2009, versus 51% in 2008. Are the units bigger? Sure you are getting on average an extra 400 and 125 square feet for two and one bedroom units, respectively. That translates, on average, to $325,000 more for a two bedroom unit and $200,000 more for a one bedroom unit in buildings with a doorman.

Will my property be worth more or depreciate less in a doorman building? For a one bedroom unit, the extra amenity may help your relative market position. The PERCENT change in value two bedroom units is about the same, at 7% less for each of the last two years. One bedroom doormen units did slightly better in terms of holding onto more value a 7% decline versus 13% for non-doorman units.

So what else is your money buying? It’s not just the doorman that drives the value. Buildings with doormen almost always also have elevators, many have exercise rooms and laundry in each unit, and for two bedroom units, an additional second bathroom.

Clearly lifestyle and overall amenities are key factors in making a decision to purchase in a luxury building and only you can determine if they are worth that investment. Whatever your needs, we can help you find the ideal unit for you.

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