Wednesday, November 12, 2014

Closings of Note: A Matter of Perspective

Bedford - Atlantic Intersection in 1896

Brooklyn Chicken Littles, remember the 1890's when all these amazing New York brownstones were built?  Ok, neither do we.  But remember the 1990's when 25' wide houses on the Upper West Side a block from Central Park could be picked up for under $2M?  Well, now those same houses sell for well over $10M.  But, as first reported on BKTTF, it turns out that the Upper West Side is precisely as many express stops from lower Manhattan as Prospect Heights.  So can we really be shocked that Prospect Heights houses have gone from $1.5M to $3M in the past 2-3 years?

And if you can bear the stigma (why'd you even have a stigma again?) of such perceived outer-reaches as ~Harlem~ (a mere 2-3 trains stops further from the Upper West Side) you'll find even TV stars dropping some serious coin for townhomes there.  Like your boy Neil Patrick Harris' "recording setting" $4M house on 126th Street in Harlem.  Listen to him tell ya Harlem's "more bang for your buck".  Crazy, we know...

Remember what $4M looked like in Park Slope 2-3 years ago?  At high profile house 178 Garfield Place, that was purchased for $1.3M back in 2004...

And celebrity homes in Brooklyn are commanding over $7M these days.  Like this one purchased for $3.6M in 2005...

So you don't have to like that 2011-2012's $1.5M's houses in Clinton Hill and Prospect Heights are among the $3M+ houses today, but you can't pretend there isn't a much bigger pond with much bigger fish in it that these numbers are all a part of.  As we've said, nobody promised you Brooklyn could or would stay your personal Discount Shoe Warehouse for brownstones forever.  And those numbers in those Brooklyn neighborhoods are precisely why the $800K-$900K houses from 2011-2012 in Bed-Stuy and Crown Heights are among the $1.6M+ houses today.  And $3M is knocking on Bed-Stuy's door now too. 

As it's always been, it is what it is.  Let's take a case-by-case look at a few of today's Brooklyn prices...

We tried to tolja that 368 Grand Avenue was one of the best buys under $1.5M in 2012, even if it's super narrow.  Owners asked us this year if it's worth over $2M, we said yes, and had 2 off-market Platinum Member examples of why.  The house listed for $2.1M and sold for over $2.3M last month.  This is exactly why all you jokers with $500K down and pre-approved up to $2M - while, god bless ya, that's a lot of money and earnings you've got going on there - can't find a turnkey 20'-wide 2-3 Family with an owner's duplex or triplex and rental income for $2M.  Or even, $2.3M, or even $2.5M.  Heck, 395 Grand is in contract pushing $3M, 102 Gates Avenue has turned down offers well over $3M, and 384 Vanderbilt Avenue is closing for $3.5M cash.  Are you keeping up?  The money simply has nowhere to run, nowhere to hide.  So when a few of the people who can play ball in & around $2M start seeing this activity and can't get in Clinton Hill anymore, that's when you start seeing the $2M+ head to Classon and beyond.  And now $3M is coming up on Classon.

With all this Clinton Hill activity, now even the narrow fixer-uppers can command over $2.3M.  No wonder investors were eager to pick up 331 Washington Avenue for $1.9M in June and try to flip it for some $2.5M.  The off-market flip didn't work, but the Corcoran approach did.  Closed for $2.55M to Manhattan buyers last month.  17' wide fixer-upper pricing is no joke!

What does $1M look like in Brooklyn these days?  How about an apartment by the highway on the edge of south Slope at 166 16th Street last month.  Manhattan buyers got #9A for almost $1,000/sqft.  556 State Street condos had another closing just under $1M last month too.

Since $1M condos in Park Slope are such slim pickings, you're seeing them make their way towards Bed-Stuy.  Take this sweet lil' loft at 317 Greene Avenue, #4B between Classon and Franklin.  Closed last month for $925K.  $700/sqft in Bed-Stuy, here we come!  No wonder larger condo conversion opportunities in Bed-Stuy are outpacing even those in Prospect Heights sometimes on the right blocks in the $300/sqft range.

All this makes 145 Jackson Street, #2B in Williamsburg - even at $1,000/sqft - sound tame.  Closed in September for $750K.  In 2008, these were all under $500/sqft.

What does $1.6M look like in Brooklyn these days?  How about a condo at 52 Dean Street, #2C?  Closed last month for $1.6M and available to rent for $6,500!

When $1.6M is consistently merely a condo in Boerum Hill, no wonder peeps are heading "deep" into Bed-Stuy for a townhouse like 178 Macdonough Street for $1.53M last month.  Buyers from downtown Brooklyn pulled it off with some ~$300K down.  Nobody's saying 178 Macdonough is the next 178 Garfield, but does it even have to be?

1 comment:

  1. Nice insight, but I have ADD and your writing style truly makes my head hurt.