Wednesday, January 8, 2014

The Million Dollar Condo Hits Clinton Hill: 338 Clinton Avenue, #3

Why, oh, why is it so hard to find that turnkey, 4 story, 20' wide 3-Family in prime Clinton Hill for $1.5M with 20% down anymore?  You know, the one with the rental income that pays for itself??  (Is what they e-mail us every week...)  Well, the answer is simple.  First of all, banks want 25% down now.  Second of all, we live in one of the richest cities in the world.  Now that fixer-uppers in Park Slope, Fort Greene, Prospect Heights, and all of BoCoCa are consistently over $2M, the $1.5M pricing has no where left to go but Bed-Stuy, Crown Heights, Gowanus, and Lefferts Garden.  And poor Clinton Hill is caught in the cross-fire of the gentrification march east.  So even if such a house did list in Clinton Hill for $1.5M in today's market, dozens of people with much more than 25% down would bid it up higher.

So while condos in Fort Greene have begun coasting higher than $1M on a regular basis, it would only be fitting that condos in Clinton Hill start doing the same thing.  As the New York Times reports, "Fort Greene occupies less than one square mile."  Most people can't even tell you exactly where Fort Greene ends and Clinton Hill begins.  And folks who treat them like such different neighborhoods haven't been living in Brooklyn for more than 5 minutes.  So when a floor-thru condo at 338 Clinton Avenue, #3 listed for $1.05M, was it any surprise that buyers from Scarsdale said, "Cha-ching!" and took it down for $1.069M in November of 2013?

The ol' condo conversion blueprint played out here on the 5-story brownstone at 338 Clinton Avenue:  max out the original details and update the kitchen and bath, eh?

The technique has basically moved all 5 apartments out the door for $1M a piece, with just a few weeks or even just days on the market.  Apartment #2 had its own charms...

Apartment #5 got the roof deck...

 The garden apartment got, well, the garden...

You know, the usual division of goodies in these places.  And to think, we were talking about the entire house at 338 Clinton Avenue as "sticker shock" with no interior pictures for $2M back in 2011.  Back then you could afford to be lil' snarky with an under-marketed piece when there were a few deals still lurking that weren't completely bombed-out.  This house was gorgeous all along, but very few took the chance to find out.  We tolja' when they sold it a little below asking price and relisted for $2.6M for the whole place too.  Now they're moving for a million per floor, and it's probably still going to go misunderstood.

What's funny is, handfuls of townhouse buyers on their Rip Van Winkle still wouldn't do this deal today for the $1.9M-ish that it sold for in 2011.  Condo buyers of today may be shocked that these go for a million now.  And developers would still scoff at the upside in this deal if they had it to do all over again.  Condo converters have complained to us about deals that net "only" $700K-$800K, as if that isn't enough to even roll out of bed in the morning for.  Brooklyn's real estate market can't please all the people all the time.

Makes us shake our heads at condo converters still doubting the potential of huge 5-story townhomes and 8-Family buildings in prime Prospect Heights looking to move off-market as we speak.  If Brooklyn's "best of breed" still isn't good enough for you, just what are you holding out for?

Pro's:  restored and renovated 2BR condo, original details and modern upgrades, marketed well, killer curb appeal and great location

Con's:  gone already, barely lasted, may cause sticker shock again, yet it still went over asking price

Ideally:  when the million dollar condo is effortless in prime locations, and as $900/sqft spreads east, you can tell us when & where you think it'll stop.  All signs point to a townhouse anywhere near a million, if you can still find one.

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