Small real estate brokerages are doing well in brownstone neighborhoods in Brooklyn, according to the Times, where buyers seek their local expertise and deep connections. In Bed Stuy, Evans & Nye is becoming known for having sold some of the most beautifully appointed and highest priced brownstones in the neighborhood, many just under $2,000,000. In April, the firm sold a limestone by Magnus Dahlander at 242 Decatur Street, above, for $1,700,000.
Firm co-founder Ban Leow is a long-time resident and owns the furniture and antique store CasaBAN across the street from his real estate office on Tompkins. It also helps that one of the firm’s agents, Morgan Munsey, is a walking encyclopedia of Bed Stuy architecture and seems to know every resident of the area. Over in Victorian Flatbush, the 93-year-old Mary Kay Gallagher has flourished for almost 50 years by charting a similar path. She is famous for her deep knowledge of the area, where she also lives. Her three-person family firm sold a colonial on Westminister Road for $2,000,000 this past fall, a record.
If you are buying or selling, do you look for a big name or a small one?
A New York Times “The Hunt” story trailed a couple as they looked for a house to buy in Bed Stuy. They were renting a studio in Brooklyn Heights and decided to make the jump into home ownership when their rent increased to $1,850.
Two years ago they started hunting in Bed Stuy, with a budget starting at $600,000. They saw a great place for $700,000 but passed because it was located in Crown Heights. Then the market took off.
Prices kept rising, investors were buying at high prices with all cash, a house they liked didn’t appraise — it’s a familiar story.
Eventually, they ended up buying an SRO in Crown Heights for $950,000. They closed in mid-summer. Now they are waiting for a certificate of non-harrassment and plan to move in with their new baby, who is due in January.
A recent post on the Forum asked “Is it even possible to buy a decent home in this market?” The poster is looking in far east Bed Stuy for a non-flipped house in OK condition with a budget of $800,000 and $200,000 set aside for renovations. What do you think?
If you do not already live in Windsor Terrace, perhaps you’ve thought about it. Specifically, you may have noted its proximity to Prospect Park and wondered if there are any secret housing bargains to be found there — if you’ve heard of the neighborhood at all.
A story in The New York Times real estate section looking at what it’s like to live in the area does not entirely clear up this question. The area is relatively small with few transactions, so it’s hard to get a grip on what things cost there, according to the story. However, it appears Windsor Terrace is competitive with if not more expensive than South Slope, with prices for row houses clocking in at “nearly $2,000,000,” according to the Times.
The one large grocery store in the area, Key Food, famously closed, but is expected to open a small outpost in its former home, now a Walgreens, this coming spring. In late November, only 15 properties of any kind were on the market. The F train takes about 40 minutes to get to midtown, according to the story.
If you live there, does the Times writeup ring true? What is your favorite thing about the area?
Brooklyn’s top real estate developers, investors and lenders will gather on Wednesday at the New York Winter Apartment Summit to discuss multifamily real estate issues, with a special focus on investment and development in emerging areas of Brooklyn. The extensive speaker list includes Meir Milgraum, director of acquisitions at the Lightstone Group; Alan Washington, director of real estate and planning at the Downtown Brooklyn Partnership; Melissa R. Burch, executive vice president of Forest City Ratner; and Richard Katzenstein, managing regional director at Freddie Mac.
Marcus & Millichap is sponsoring the event, which will host more than 225 real estate execs at Skylight One Hanson (pictured) in Fort Greene. Panels will cover topics like the future of multifamily development in Brooklyn, what neighborhood will be the “next Williamsburg,” construction loans and eco-friendly construction. Those interested in attending can read the full agenda here and register here. The conference will run from 8 am to 2 pm on Wednesday, December 4.
Brooklyn commercial property sales are still chugging along, with a 14 percent increase in the number of buildings sold in the third quarter vs. the previous one, according to a report from Massey Knakal. The real estate firm notes that this year’s 389 property sales are the most buildings sold since 2007, excluding the “hyperactivity” of the fourth quarter of 2012 when 581 properties changed hands.
Not surprisingly, the most expensive purchases were development properties. The Lightstone Group’s purchase of 363-365 Bond Street and 400 Carroll in Gowanus set the record for the quarter at $33,150,000. That was followed by Sydell Group‘s $17,000,000 purchase of 93-97 Wythe Avenue, which will eventually be the site of a Freehand hotel. You can read the rest of the report here.
The New York Times took a look at Canarsie as a place to live and discovered a close-knit, diverse community with affordable homes. One- and two-family homes range from $350,000 to $600,000. The prices are still off their 2007 highs, when a two-family cost $450,000 to $725,000, thanks to the twin blows of the mortgage crisis and Hurricane Sandy.
“The mortgage crisis is only getting worse in Canarsie, and it’s been exacerbated by Sandy,” Angella Davidson, who manages the foreclosure prevention program of the nonprofit Neighborhood Housing Services of East Flatbush, told the Times. “People who already were struggling to pay their mortgage are now falling further behind, because they’re using money that should be earmarked for their mortgage to replace boilers and Sheetrock. And Sandy has forced people who were not in foreclosure to face potential foreclosure.”
Many residents faced two to three feet of flooding in their basements, and much of the damage isn’t covered by insurance. And to make matters worse, 10 percent of small homes (one- to four-unit properties) were in foreclosure in Canarsie as of June, according to the Federal Reserve Bank of New York.
But Canarsie brokers feel like the market is beginning to pick up there, based on the number of sales. “Canarsie has not recovered much from the mortgage crisis,” Jean-Paul Ho, broker-owner of Brooklyn Real Property, said, “but you can feel it in the volume of transactions. Nothing was selling last year, but now the activity is there.”
We’ve noticed several signs recently that the quickly rising prices for Brooklyn town houses may begin to slow soon. Nationally, growth of home prices is slowing down, according to the Case Shiller index. Mortgage interest rates have finally begun to rise. And, finally, equity-backed investment firms — which have purchased at least an estimated third of homes across the U.S. and buoyed prices nationally as well as in Brooklyn in recent years — are beginning to falter. Last week, the U.S.’s second biggest owner of single-family rentals, American Homes 4 Rent, laid off employees after going public. Early mover Carrington Holding has stopped buying single-family homes to rent and has started to sell, reported Businessweek.
“We just don’t see the returns there,” said the company’s chief executive officer in the story. “There’s a lot of — bluntly — stupid money that jumped into the trade without any infrastructure, without any real capabilities and a kind of build-it-as-you-go mentality that we think is somewhat irresponsible.” At least three companies have reported losses in their single-family rental investment businesses because they snapped up houses faster than they could fix them up and fill them with tenants. “Colony American Homes, a division of Thomas Barrack Jr.’s Colony Capital, has found tenants for only 51 percent of the 9,931 homes it bought for $1.4 billion, according to a May 28 regulatory filing. American Residential Properties (ARPI) and Silver Bay Realty Trust (SBY) reported losses in the quarter ended March 31,” the story said.
Closer to home, we hear even more inventory is about to come on the market in Bed Stuy — so much inventory that prices are expected to slow or even plateau there. What do you think? Could sale prices for town houses slow across the borough? What about apartments and rentals?
We spotted a construction fence up at 291 Metropolitan Avenue in Williamsburg, where a garage was demolished in June. DOB records show the owners are planning a five-story apartment building with 27 units. They’ve been approved to build 19,196 square feet of residential space with a little bit of commercial space on the 7,251-square-foot lot. The permits haven’t been issued yet.
Over the weekend, The New York Times ran a profile of Morgan Munsey, ardent preservationist and walking encyclopedia of Bed Stuy history, architecture, houses and the people who live in them. You may know him as Brownstoner commenter Amzi Hill, who also gives walking tours with our own Montrose Morris. (Above, a favorite block often featured on the tours and one of the Gold Coasts of Bed Stuy, the stretch of Hancock Street between Tompkins and Marcy.) As regular readers of this blog know, Munsey recently put his many contacts in the area to good use and became an agent with Evans & Nye, where he specializes in digging up some of Bed Stuy’s best-preserved and most impressive properties. Also, with his Rolodex of top-notch tradespeople, he is able to guide clients who want to preserve and restore their purchases rather than gut them. We hear 242 Decatur Street, which Munsey co-brokered, is in the process of being restored to its original glory from top to bottom, including the kitchens and bathrooms. The story is sprinkled with Munsey’s delightful bons mots; we could see and hear him walking and talking as we read.
The group of 75 Bushwick artists who are trying to collectively find affordable work space in the neighborhood are considering two options, The Wall Street Journal reported. One scenario is to raise donations from investors, ideally art collectors and gallery owners, to create a trust and buy a large loft building to house artist studios. The other scenario is that the artists themselves will pool down payment money and buy buildings in smaller groups. For example, ten artists could each contribute $40,000 toward a $400,000 down payment on a $2,000,0000 loft building with enough space for 10 studios. One sticking point is how to keep the buildings affordable and whether or not artists would be able to sell at a profit. The story didn’t specify if the artists are looking for live/work space or just work space alone. Painter Jules de Balincourt got the group going with a Facebook post in June in which he suggested pooling resources to secure studio space. The group has had one meeting since then, with two more scheduled this month. Balincourt, who has shown at the Whitney Biennial, has owned a building on Starr Street since 2006. Rents have risen dramatically in the area in the last year or so, as a huge number of new bars, restaurants and other businesses catering to recent college graduates have also opened there. Above, a sculpture outside a house on Wilson Avenue.
Over the weekend, the New York Times examined that phenomenon familiar to Brooklyn house hunters during boom times: the “shift the goalpost” home sale, as they termed it. A buyer makes an offer, it is accepted and then, before the contract is signed, the sellers say they have another offer on the table and would the buyer like to increase his or her offer? Or one bidder wins a “best and final” match, only for the seller to turn around and ask for more later.
Is there any way to know if the seller really has another offer on the table or is just trying to get more? Not really. Even brokers decried the tactic. “It’s surprising how ugly it’s getting,” said a real estate lawyer who said now he sees about one deal like this a week, and said attorneys are complaining about having to draw up multiple contracts for some deals. “If you don’t hear back about a contract in two days,” he said, “there are usually some shenanigans going on.”
A story in the Post yesterday confirmed what regular readers of this blog have known for some time: Home prices in Bed Stuy are rising quickly — as are prices in other neighborhoods outside the traditional Brooklyn brownstone belt. Average condo prices are up 12 percent and two- to four-family townhouses up 36 percent this year vs. last year in Bed Stuy, Crown Heights, Bushwick and Prospect Lefferts Gardens, based on data from the Corcoran Group, the story said (presumably it meant as of May, the end of the second quarter, but the story didn’t specify). The reasons given were many: Brooklyn has become a top-tier destination, rising interest rates, not much newly built inventory, and improving retail and amenities — as typified by Franklin Avenue. What do you think the reasons are — and will the prices last?