"Straight Cash, Homie": 331 8th Street

Unicorn Hunters, take heed.  How did this beautiful single-family fixer-upper in Park Slope, on a lovely block between 5th & 6th Avenues fall from $1.795M ("PRICED BELOW APPRAISED VALUE") in early March, to $1.67M 3 weeks later, to closing for $1.55M last month?  You heard that right, a Corcoran listing at 331 8th Street going for $245K under (not over) asking price?

The answer?  "Straight cash, homie."

Which was Randy Moss' explanation for how he paid a $10K fine the NFL slapped on him for mock-mooning the Packers fans in Lambeau Field in 2005.

Moss claimed to not use checks, and some buyers simply don't use financing.  Cash gets the job done.  Jay-Z said, "If money talks, the whole world 'bout to hear me out."  Nice gig, if you can get it.  Cash is quicker and more decisive than banks and appraisers, which are the #1 reason that contracts fall through.  Which is exactly what happened on great buys that should've closed last year, that Platinum Members got a 2nd stab at when the properties were momentarily back on the market.  Great properties at great prices like 270 Sterling Place, 71 Irving Place, and 1142 Dean Street.  Few have the time to nag absentee brokers who were barely there the first time around, but BK to the Fullest doesn't stop 'til the deal is dead, because contracts do fall through.  Which, incidentally, is exactly why brokers rarely reveal their actual contract price when a building is in contract (for all of you Nosey Nancy's who simply must know what every last comp is before you put in a bid) because they don't want to diminish their leverage by revealing what price the seller will accept, in the event that they're ever back out on the market.  Which is why even last week's NYTimes typo article couldn't deliver a firm contract price on the flagship property in their cover story:

"The building is in contract for an amount higher than the asking price.  Mr. Gennaway would not reveal the sales price before the deal closed."

Those who don't understand this process claim to be "shooting in the dark", even though there is an absurd amount of public information in this industry already.

But back to the matter at hand... cash got it done on this fixer-upper with tons of original details and updated mechanicals.  Besides, who wants to update the mechanicals anyways?  That's the boring part.  The fun part is the rest of the interior.  And this 18.5' x 45' is a healthy-enough floorplate to put the finishing touches on.

Get that roof deck going and you're really cookin' with gas.  (While no pun intended, note, "the fuel system has been converted to gas, and the oil tank has been removed")

Many will see this sale and this beautiful exterior and think, "How'd I miss that great buy just a touch above $1.5M?  I would've put $300K down on that!" without realizing that only cash made it happen at that low of a price, there's no rental income to be had as-is, and that the place may undergo another $500K in renovation yet.

Pro's:  curb appeal, location, original details, updated mechanicals, keep as a single family or convert to a 2-Family for more income

Con's:  gone already, takes a HEFTY bunch of cash upfront, still work to be done, most won't understand the nuances on the sale, no rental income as-is

Ideally:  if you don't have this kind of cash, at least realize the power of financing and apply it accordingly

Projects: 397 1st Street

 
If Curbed and Brownstoner can get into the act, we figured why not get a peak at the condo conversion at 397 1st Street ourselves?  If you want PS 321, it doesn't get more point-blank range than this bow-front 8-Family on the same block between 6th & 7th Avenue as everyone's favorite Park Slope school.  Picked up last April, the condos in this building should be finished this month and coming to market soon.

Originals like stained-glass windows and mantles were retained where appropriate...

 
But this gut-renovation was extensive in its upgrades.  Besides some of the standard basics like reconfigured floorplans, modern kitchens with Caesarstone & stainless appliances, and washer/dryers in each unit, the developers took input from families in the community and made a few nifty touches of their own.  Basement storage for each unit, common space for bikes & strollers, as well as a kid-friendly bathtub in the 2nd bathrooms are some of the family-centric details.  From the high ceilings to the sound-proofing foam under the solid oak floors, you've got some solid condos that make the most of an otherwise-narrow floorplate.  What might be a small 2nd bedroom to some makes a good kid's room for young couples.  Individually-controlled heat and air conditioning in every room?  Check!

Other nifty touches include the finished basement & landscaped backyard for the duplex apartment, plus separate roof access & roof space for the top apartments.  Manhattan views, anyone?

You can literally watch your kids play basketball in the courtyard of PS 321 while you sit on your roof reading BK to the Fullest on your iPad.  Even the bulkhead on top will have a slanted skylight, in addition to the side exposures on the top floor apartments.

As comments on Curbed pointed out, the bathrooms aren't quite everyone's taste, but we respect game.  What this project lacks in some respects, it more than makes up for in others.  While some drink Hater-ade in the Comments section on Brownstoner in blind angst against developers, presuming that "there had to be at least a few RS tenants left in this building," the building in fact was a 6.6% cap with 6 of 8 units free market and/or vacant.  It's actually a bold move by developers Jody Kriss and Joe Cohen of East River Partners to take a great buy & hold investment and make it a full-on gut project.  Bold, and smart.  All & all, not a bad way to bring some nice product to a market hungry for affordable condos with sensible upgrades that aren't in glass-box buildings.

Pro's:  location, curb appeal, modern upgrades, neat touches, working fireplaces in some units, family-friendly approach, variety of spaces, a chance to own in PS 321 in a bite more people can chew than $2M+ fixer-uppers

Con's:  narrow, not everyone's taste, no secret bargain to be had here with Corcoran on the case

Ideally:  a nifty project for sure that's bound to make for happy buyers and sellers

Flip-a-Roo Accepts Offer in a Week: 1332 Bergen Street

Picked up for $330K just 2 months ago, 1332 Bergen Street listed a week and a half ago for $629K and had an accepted offer in a week, no longer showing.  For a 30' x 35' building with a funky extension, unique exterior & layout, on a 40' x 120' lot (with a ton of FAR) - this thing is going to be a neat project for someone.  That is, after you repair the roof, change the 2 old boilers, get a C of O, and remedy the pervasive mold & water damage.  All in a day's work for Crown Heights fixer-uppers.  Even after essentially doubling their money on a 90-day flip, this home still sits at a price that would make some tiny condos blush.  That's how much room to reposition there is left in the neighborhoods not everyone is hip to yet.

The size & look of the semi-attached "One Family Victorian" brick building is unique for sure.  On the facade, the asymmetrical rhythm of the windows and quirky front porch could really go either way.  The extra-deep lot is a plus.  Whether you can, would, or should take advantage of the remaining buildable square footage is another consideration.  There's already a rear extension that's serviceable, but could be upgraded.  The interior photos capture the blend of original, mock original, and dated updates inside...

This photo shows one of the water-damaged ceilings from the roof in disrepair:

This isn't your typical row house, but if you're going single-family anyways, you might as well go all-out.  Rock a decent renovation budget into this, do something interesting to the attic, landscape the backyard... any number of possibilities.  We can see a family really growing into these large spaces and backyard.  This might be a good buy in DC, let alone Brooklyn.

Pro's:  width, original details, versatile & spacious

Con's:  needs lots of work, deep in Crown Heights to some, gone already

Ideally:  anything under $700K with decent bones and original details in Crown Heights is starting to sound like a go

Above-Ask in Crown Heights: 653 St. Johns Place

It's not what the low-ballers want to hear, but it's what's happening.  A 3-story barrel-front single-family in Crown Heights with janky pictures and nothing super-appealing to speak of fetches above its asking price.  653 St. Johns Place has been asking $765K for only a few months, and closed for $800K last month.  It's a narrow-but-deep 16' x 55' house on an extra-deep 152' lot.  With some original stuff, some updates, and a rental unit that's getting over $1,000/month - people probably thought it was time to low-ball this listing.  Nothing doing.  Could it have been the off-center pictures of the interior that sent the sales price $35K over ask?

If you're not impressed, you're not the only one.  Heck, we thought the price on 10 St. Charles Place (around the corner) was a touch high until we saw this.  Granted, as "Crown Heights" goes, this location is about as clutch as you can ask for.  Around the corner from the Franklin 2/3/4/5 trains, and the best stretches of Franklin Ave - the neighborhood's most mature & rapidly-improving commercial blocks - this is hardly the Crown Heights most people had in mind even a few years ago.  In fact, if you go back to 1943, this profile of Park Slope had that neighborhood ending at Franklin Ave (and the majority of people paying $30-49 in rent).  Now that's really a frame-shift by modern standards!

There's still a 3-Family brownstone down the hill for this price that has more value, but if you can swing a single-family for $765K, what's another $7,000 down and $165/month to get it at $800K?  Still beats a condo most every day of the week.

Pro's:  as good a location as Crown Heights gets, single-family easily used as a 2, extra deep lot, plenty of FAR, turnkey

Con's:  narrow, mediocre renovations, janky interior pics, went for above ask

Ideally:  as they say, "price is truth"

Next Shoe to Drop (Pt. II): 44 Rutland Road

If you the missed the House Tour yesterday in Prospect Lefferts Gardens, don't miss the next-best buy in the neighborhood. 44 Rutland Road is a single family barrel-front brick & brownstone building on a great block in Lefferts Manor for $1.4M.  If you want to live on a great block just off the park, and you don't want to spend $2M-$3M to do it, this is your chance.  Despite signs posted on these blocks that are zoned for "one family only", with two entrances, it's easy to use this 1-Fam as a 2.

The interior has the original wood details like parquet floors and pocket doors galore that people gush about - perhaps almost to a fault.

The shiny, waxy finish on the floors might be one of the first things to go, which isn't hard at all to remedy.  Stained-glass windows, a huge master bath with a skylight on the top floor, a finished basement, an updated (if generic) kitchen, puts the finishing touches on this 4,000 sqft historic house on a 100' lot.  Greenify the backyard affordably, and you're really cookin'!  Use the money you don't waste on the next-best houses that are $500K more than this to fine-tune all the features of this home for your purposes.  The kitchen is "meh" in our book, but at these prices, who's counting?

After you see what wants $1.8M over here, and the next-best place at this pricepoint in Windsor Terrace, you'll know why we're so bullish on 44 Rutland Road.  When you're bar-b-q'ing in the backyard of your museum-like home with modern upgrades, and your buddies go, "Now, how'd you snatch this thing up for under a millie and a half again?"

You'll go, "BK to the Fullest!"

Pro's: original details, great block, close to the park, totally turnkey, pricepoint, easy to use as a 2-Family

Con's: not everyone's hip to this neighborhood yet, museum-like interior may be too gaudy, updates and details not everyone's taste, single-fam status

Ideally: simply one of the best houses left at this pricepoint Brooklyn-wide

Topics: New York Times' Million Dollar Typo

For many people, when it hits the New York Times, it's gospel. Yet even the cherished Times isn't infallible. In this weekend's Real Estate section headline, they've slapped a $1 Million dollar misprint on their online and printed cover article about - ironically - "Brooklyn's Gold Rush". You'd think in an article about rising prices, they'd take the time to get the price right... right?

We told you back in April that 124 Park Place listed for $2.7M and closed quickly for $2.91M. Yet the New York Times has the property listing for "$1,270,000" and closing for "$1,291,000". You'd think they'd have some kind of background check on this stuff before they ran such large numbers on the cover. Don't despair, though. BK to the Fullest always keeps it 100. While Corcoran's whisking multi-million dollar properties out the door for above ask, and the NYTimes is misprinting about it, Platinum Members had over 6 months to take a stab at a 5 story brownstone shell 1 block away for 20-30% less than its current list price.

This "Gold Rush" tale is nothing new. We told you back in November about another property the Times article also covers, Jenna Lyons' $4M sale that Cousin John renovated. They talk Park Slope jumping 20% to a median sales price of $1.45M, while back in January we diagrammed every single sale below $1.5M in Park Slope in the previous 6 months. The Times says, "The biggest price increases have been in Boerum Hill — up 60 percent, to $1.7 million from $1.1 million," while we asked almost a year ago, "$1.6M is the new $1.2M?" in Boerum Hill. Check out the price increases by neighborhood for yourself:

It's easy for people to forget back in the Spring of 2009 when the Dow was mid-7,000's and properties like 132 Underhill and 96 St. Marks would drop from their $1.8M list prices to sell below $1.2M and $1M, respectively. The lull carried into the Fall of 2010 and did a complete 180 after that. In 2009, the doom & gloom was so bad that buy & hold investors were asking us if the glut of new luxury condos in towers along Flatbush (like Oro and Toren) would put pressure on their $2,400/month 3BR apartment rentals in Clinton Hill. They quoted a Park Slope landlord whose 1BR rentals had dropped from $1,850/month to $1,500/month. Now the Times says, "In April, the average rent in Park Slope was up 33 percent from the previous spring." But was that surprising anyone either?

One of the best things the Times finally points out in today's piece, something we were clamoring for in April, is that this is a supply & demand story. "The spiraling prices are being driven, in part, by the lack of supply. Despite the rising demand, no one is building new brownstones." And we've been screaming for months that Park Slope isn't the only place where people built amazing townhouses ~100 years ago, but the Times quotes a Halstead sales director who says, "People have it in their head that they want a specific neighborhood." That's why there's such a feeding frenzy at any decent listing in a good neighborhood, and why so many keep striking out bidding low against the crowds.

In some ways, Brooklyn is no secret at all. And yet in other ways, isn't it a testament to how out-of-touch Manhattan and the greater market at large might still actually be, that a $1M typo can slide by on a cover story so concerned with price? They're trying to make a price $210K above asking seem like a shocker, and they got the price wrong by well over a million?? Just imagine what upside might still be left in prices if more and more of the multi-million dollar condo buyers in Manhattan (for whom 7 figures might just as easily be a rounding error as it was for the NYTimes) decided they'd opt for a townhouse in Brooklyn instead? The gentrification might not be televised, but don't say we didn't warn ya.

Sold in Brooklyn Heights: Joralemon Street

We rarely cover Brooklyn Heights, but this deal has been asking to be swooped since the end of last summer. Listed for $2.85M - $3M for a while, this multi-family house on Joralemon recently closed "at full ask". We wish the agent would indicate that on their website, and in the other various places they're still promoting this listing as "Available!", but we all know how that goes.

While at prices certainly well above our paygrade, we'd been telling Platinum Members since August that this place was a good buy & hold in a prime location pushing a 6 cap, with further upside the market could still bear. While it requires deep pockets, the building also works as a condo conversion, whether now or down the road. With over 8 units, and only 2 of them rent stabilized, it's not the worst way to get into a 25' wide Brooklyn Heights property. Acquisition at $430/sqft ain't bad at all in a neighborhood where over 30+ condos traded in the past 6 months with a median price of $818/sqft. $870K was the median sales price of those condos. No wonder the $700K condo game is so tough in Boerum Hill and beyond.

Granted, the few looks we get of the interior are lame, but the apartments still command top dollar - as much as $2,100/month for a 1BR...

Imagine what they'd rent for if you made them really boutique-y and nice. It's not hard to imagine what they'd sell for either.

Pro's: location, size, mostly free-market, ripe for further repositioning

Con's: 2 of the apartments are rent stabilized, chopped into too many units for now, hefty renovation

Ideally: if you've got the funds to swing it, there's opportunity on blocks where some single-family fixer-uppers can command close to $1,000/sqft.