Saturday, May 5, 2012

What a Difference 6 Months Makes: 208 Lefferts Place

Boy, if you were flustered that $2M is the new $1.5M (or worse) in Park Slope, then you REALLY don't wanna hear that $1.45M is the new $849K in Bed-Stuy. Back in October, we were screaming from the mountain tops to Platinum Members that 208 Lefferts Place was a great shell for only $235/sqft. That's in a neighborhood that some people might still think is questionable, but one top broker tells us the recent average of $550/sqft for condos there in Bed-Stuy is competitive with the price per square foot in all the other top urban markets in the country like Chicago and Los Angeles. That's right - what passes as "too ghetto" for some in Brooklyn, New York is actually aspirational in other cities across the country. If there's an earthquake of high prices in Park Slope, the aftershocks will inevitably ripple out east. We saw how "the Minsk Man" tried to single-handedly bring the new price point of $1.5M across Classon into Bedford-Stuyvesant. Now this shell at 208 Lefferts Place, midway through renovation, wants $1.45M.

Yes, so conveniently close to the C train and the S shuttle at Franklin Avenue, that you can actually see the above-ground shuttle out your front window...

So the owners got this bad boy for $600K back in August 2011, figured they'd do a quick flip. And when the flipping wasn't quick enough as a shell, they decided to go the renovation route. (Unless someone else bought it in the meantime and we're not seeing it yet...) Now they're in the middle of the renovation and are urging, "Hurry Up So You Can Choose Your Own Kitchen, Bathrooms, Tiles Etc." All that to accompany the "Original Details Such As Marble Fireplaces And More." Hmmm... what say ye?

Who wants to pay top dollar for a project that isn't even finished yet? Well, this proposal actually isn't too sketchy. It goes on all the time further into Bed-Stuy at price points right around half this amount for Home Depot renovations of quick 90-day flips. In fact, they tried it in Prospect Heights at 580 Carlton Ave for $2M. We can't blame anybody for trying. In this all-out seller's market, anything's worth a shot. Many will hate on this listing purely because they know how much the sellers paid and what they were listed for before. But that's just sour grapes. In reality, these developers could be doing folks a favor who didn't have that kind of money to do the renovations out of pocket. Now anybody with a six-figure income and a 3.5% downpayment (and, trust me, there are thousands of you out there...) can go after this thing FHA-style once the renovations are done. That is, if they keep it as a legal 4-Family and do a decent-enough job on the renovation. And, in the meantime, it can't hurt to try & fetch a contract for more. But people who underestimate the role lending plays in the huge ebbs & flows of the housing market are the same people wondering why Park Slope prices can effortlessly tick up 5%, and why most of the serious buyers there still don't actually care.

Pro's: close to the train, could be a nice house when it's all said & done, keeping the 4-Family status?, won't have to come out of pocket for the renovation

Con's: pricepoint is tough (especially when we're talking mid-renovation), we liked it better bombed-out for $800K, is the shuttle loud out your window?

Ideally: fascinating for sure, but probably still not the price. We've actually got a way better play on the Clinton Hill side of this street in mind.

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