Second homes, referred to as pied-a-terres are quite common in Manhattan. One just sold for $238M at 220 Central Park South. Many pied-a-terres are located in midtown; however they can be on the east side or west side. They are also popular downtown in areas such as the West Village and Tribeca. Location is key to the pied-a-terre buyer; however, size matters too. The trend these days tend to be smaller apartments $2M and less. Two bedrooms are most common because the second bedroom can double as an office/ guest room.
Amenities are great but of lesser importance to pied-a-terre buyers. When amenities are a factor, then residential rooftops matter. For international buyers, views are desirable, as are buildings with pools. Another thing that a pied-a-terre buyer looks at is resale value. They want an apartment that is easy to rent out or to resell, so they get a decent return on their investment.
Are buyers concerned about renewed talks about a pied-a-terre tax of homes $5M and over? The pied-a-terre tax proposal will place an annual fee on properties $5M and over at a graduated rate from a few thousand dollars to $370,000 for a home of $25M or more. If a pied-a-terre tax were passed it would dissuade pied-a-terre buyers who feel they don’t use the services of a building or city as much as full-time residents. They think they shouldn’t have to pay a tax for something they use so much less of! If it were to pass the tax would likely get pushed back on to the seller or developer in negotiations.
Do you have questions on buying a pied-a-terre? Contact me anytime!