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January 12, 2006

House of the Day: Vinegar Hill Four Family

houseDespite the proximity to the Farragut Houses, we have a soft spot for the small number of brick townhouses that populate the historic district of Vinegar Hill and always keep an eye out for ones hitting the market. Corcoran's got a recent listing for a 4-story 1829 house at 73 Gold Street, just a few lots over from another recent HOTD. We're initially a little suspicious of the lack of interior photos and the emphasis given to scenic neighborhood shots. Plus, if the interior were in good shape, we'd imagine the price would be quite a bit higher, so maybe it's a good fixer-upper opportunity. But what do we know. The curious can take a look this Sunday and next from 12 to 2 at the open house.
73 Gold Street [Corcoran] GMAP




Posted by Brownstoner at 11:41 AM | Comments (40)
Categories: Properties

Comments

over a million for a shack near the projects???
Geez

Posted by: Anonymous at January 12, 2006 11:53 AM

I need someone to help me understand the relationship between Vinegar Hill and DUMBO.

Seriously.

Thanks

Posted by: Hal at January 12, 2006 12:25 PM

It is my understanding that Vinegar Hill is the small, quaint neighborhood between the Navy Yard and DUMBO. From what I gather it is a tiny, secluded enclave--cut off from the rest of Brooklyn during the Robert Moses crusade (there is some interesting history along with many cool photos posted by a VH resident during brownstoners vacay).

I always drive through VH on my way to DUMBO from CH and it is like stepping back through time -- cobblestone streets, lovely old brick townhouses. It reminds me a bit of Red Hook, especially since it's very near the water.

My main misgiving about Vinegar Hill is the massive Con Ed plant, but I can also see why people would want to live there. It seems very enchanted and remote. There have been several new high-end condo develoments built there recently.

I believe people who live there use the York Street subway stop, but I'm not sure.

Well that's what I know about it, I'm sure there are others far more enlightened. Whaddya say guys?

Posted by: clinton hillbilly at January 12, 2006 12:51 PM

well the problem with this house is the proximity to the farragut houses which will never go away, never ever ever. the other problem is putting yourself at risk of cancer with the con ed power plant that throws off fiber radiation particales into the area. other than the cancer and the shootings and drug dealing the house is nice. the rents are really low all under $1000 a month.

Posted by: Anonymous at January 12, 2006 12:56 PM

If the rents are under a G, price seems high. It seems that most other b-stone hoods have values proportional to rent command, all in a similar way. 1 and change is a CH price but apts there barely start as low as a G.

Posted by: Anonymous at January 12, 2006 2:02 PM

Clinton Hillbilly, thanks for the reply, but I still don't get it. Is DUMBO only the area between the bridges? I'm not sure if the Manhattan bridge is the boundary. Or maybe it's not so clearly defined.

Posted by: Hal at January 12, 2006 2:07 PM

rents are very low the highest is $975 but there are no leases so i guess if you repair the place you can ask for more. Just this is not a place for a family let alone a normal mind.

Posted by: Anonymous at January 12, 2006 2:09 PM

while the place is only a couple blocks away from the projects and the power plant, so is the J-Condo where prices exceed $1000/sq ft.

Posted by: Ben at January 12, 2006 2:21 PM

As far as relationship Dumbo/Vinegar Hill - essentially same area (using same subway stop of F train to York Street) - but Vinegar Hill describing a handful of square blocks closest to Navy Yard where some old brick homes still exist.
Both 'areas' are north of the BQE along the east river - and altogether comprise not a very large area.

Sounds like very interesting price - probably needs work - current rents are very below market. As far as closeness to projects - no closer than much more expensive properties in Fort Greene and Boerum Hill that are closer to their respective 'hoods projects.
I think its closeness to very expenive Dumbo development and growing amenities would make attractive buy- but not for someone looking for pristine Bklyn Hts or stroller invested Pk Slope.

Posted by: Anonymous at January 12, 2006 2:31 PM

Thanks all. I found a map which seems to indicate that DUMBO is straddled by the bridge and squeezed in between Vinegar Hill and Fulton Ferry.

Now I'm wondering about "fiber radiation particles" mentioned above. I've never heard about that, but I would be interested to know more.

Posted by: Hal at January 12, 2006 2:58 PM

not sure of the boundry for the area. sorry

Posted by: Anonymous at January 12, 2006 2:58 PM

The land where the Con Edison plant currently stands is slated to become part of Brooklyln Bridge Park. So the plant will be gone in 2-3 years.

Posted by: Anonymous at January 12, 2006 3:01 PM

if this is true (con Edison is changing to park)
This area can improve a lot. Park with water and view could be great, it could totally change real estate value in VH.

Posted by: malymis at January 12, 2006 3:15 PM

but it looks like brookyn bridge park will not go that far as Con Ed plant.
http://www.brooklyngreenway.org/smap13.htm

Posted by: malymis at January 12, 2006 3:19 PM

People keep looking for and remarking on boundaries for neighborhoods and get so sensitive about them. Neighborhood names tend to descibe a general location and have no 'boundaries' such as a political boundary (like one assembly district to another).
They are not set in stone and meaning has to do with general usage and changes over time.

Posted by: Anonymous at January 12, 2006 3:31 PM

malymis - agreed, I've never seen/heard anything that indicates that plant is going anywhere. The northern border of the park, I believe is the two current park-lets already in Dumbo.

Posted by: Joel at January 12, 2006 3:35 PM

IMHO Vinegar Hill has the distinction of having the coolest house in New York City. This would be the what we called the "Admiral's Mansion" when I was a kid. It's a white house behind a high gate at the edge of Vinegar Hill. I think a real estate mogul owned it once. It has a circular driveway that used to have a bunch of classic cars parked on it.

The whole area is really evocative. You can imagine the workers pouring out of the Navy Yard and into the bars (Vinegar, get it) on pay day, getting good and drunk, and hurling bottles over the Mansion walls. Ah. History.

Posted by: bkborn at January 12, 2006 3:35 PM

There is a very effective way of avoiding the harm of fiber radiation particles. An A.F.D.B. Device renders them harmless, check it out:

http://zapatopi.net/afdb/

Posted by: will at January 12, 2006 3:36 PM

ConEd plant is going nowhere

Posted by: Anonymous at January 12, 2006 6:00 PM


I don't know how anybody can see a house like this for sale for $1.2M and say that Brooklyn Real estate is overpriced. The same house in the West Village would be worth ten times that amount.

Both are areas noted for their cobblestone streets and good amenities. Vinegar hill has better views and a quieter atmosphere. West Village is more centrally located.

Prices in Vinegar Hill really should be much higher than this (or WV prices should be much lower) and anyone looking to buy a home in that price range would be very astute to jump on this one.

Posted by: veggieburger at January 12, 2006 6:05 PM

What amenities are you talking about?
Last time i was around there was no single retail buissnes in VH.

Posted by: malymis at January 12, 2006 6:22 PM

If that ConEd plant is going, y'all better be ready to start cooking over an open fire.

Posted by: Anon at January 12, 2006 6:34 PM

When people use the abbreviation CH are you referring to Cobble Hill, Clinton Hill, Crown Heights, some other heights or hills?

Posted by: Anonymous at January 12, 2006 7:52 PM

For the most part, CH, at least on this blog, refers to Clinton Hill. Nevertheless, the subject matter at hand can easily be inferred from the postings. I guess it depends....

Posted by: BrownBomber at January 12, 2006 8:21 PM

hey bkborn i am wearing a aluminum foil detector right now and i am not even near the con ed plant, but please folks whatever you do , do not take your kids and put them in this home it is not safe cancer wise and crime wise also. You are right about the west village being more expensive but there is nothing in vinger hill except the random gunshots from the farragut houses

Posted by: Anonymous at January 12, 2006 9:46 PM

Considering the post above regarding this New York neighborhood area, it would be such a waste. The brick townhouse looks decent from the outside and I think the cost is affordable enough, even without viewing the interiors.

Posted by: ty at January 13, 2006 12:48 AM

Interesting link...

http://www.forgotten-ny.com/STREET%20SCENES/Vinegar%20Hill%20Page/vinegar.html

I just moved from DUMBO 6-months ago...anyone thinking of paying $1.2MM in Vinegar Hill without a 20-year time horizon needs their head examined...the place is a wasteland...sort of Williamsburg-like but with brownstones that were last taken care of in say 1860 rather than tacky new construction...

What is with this boundary obsession? I just do not get the bizarre snobbery of people who are insistent that only they live in a neighborhood and others better not try and steal their moniker...its probably the same cretins who continually correct peoples spelling..."I can spell and if you buy that house you won't really be living within the boundary of CH/FG/CG/PS"...I moved to Brooklyn to get away from this crap

Posted by: Anonymous at January 13, 2006 7:35 AM

not too mention the muggings in the nabe.

Posted by: Anonymous at January 13, 2006 10:55 AM

Veggie Burger:

Check out the West Village townhouse on Curbed today --

http://www.curbed.com/archives/2006/01/13/curbed_pricechopper_village_green_turns_to_yellow.php

They're asking $4.4 million for a beautiful 4-story place. If houses in the West Village are worth 10 times those in Vinegar Hill (as per your comment), that would suggest that the Gold Street house should be closer to $440,000 (rather than $1.1 million).

Around a half a million sounds about right to me, actually.

Posted by: Sloper at January 13, 2006 12:36 PM

Informal survey:

If you could afford a 4.4MM townhouse, would you rather live in Manhattan or Brooklyn Heights?

Or would you buy the cream of the crop in Fort Greene or Park Slope and pocket the difference?

Posted by: clinton hillbilly at January 13, 2006 1:37 PM

This house is a very good deal. If you bought it for $1.1M, with 25% down at 6%, your mortgage would be about $4950/month.
Taxes: $170/mo
Insurance: $150/mo
Utilites: $350/mo
Other Expenses $400/mo (includes repairs and vacancies)
Total: $7020

Potential Rent roll with cheap renovation:
4th floor: $1900
3rd floor: $1900
2nd floor: $2000 (has a nice deck)
1st foor: $2200 (large yard)
Total: $8000

Monthly profit: $980
Annual profit: $11760

Total outlay:
Down Payment: $275,000
Closing Costs: $20,000
Cheap Renovation: $60,000
Total: $355,000

First year annual return: a little above 3%.
You could raise each rent by $50-100 every year.

The potential appreciation of a house like this is astronomical. Its in a gorgeous area near DUMBO where the market will always be very strong. When you decided to sell in a few years, you would convert it into a 1-2 family and do a better renovation. Then you would sell it for $2-3 Million.

Posted by: veggieburger at January 13, 2006 1:48 PM


Just noticing that in the above scenario, if you raise rents an average of $75 annually, your annual return goes up about 1% every year. So you get 3% return the first year, 4% the second, 5% the 3rd and so on. In a few years your annual return gets HUGE, assuming you don't sell the building first. Which, as I stated above, might be tempting if prices in that nabe continue to rise (as I suspect they will).

Posted by: veggieburger at January 13, 2006 2:02 PM

The rents on the 4 units are currently around $900, to assume that the owner could EASILY get $1900 is silly, if he could, he would. When buying rental properties it is best to assume that the rent that you will get is close to the rent that is being paid. If it would be so easy to raise the rents then the current owner should do so before he decideds to sell - you think he does not want an extra $4k a month?

That being said, if this house was $750k, it would have been sold yesterday.

Anyway, the layouts stink, except the top floor which is ok.

Posted by: anon at January 13, 2006 2:24 PM


Sometimes landlords have friends and old tenants in the building that they undercharge to be nice. Other times landlords don't realize that they are undercharging when they are.

A quick search at Craigslist shows 13 listings in Vinegar Hill that range in price from $1800 to $3800.

My estimates of $1900-$2200 are very much on the low end of this range. I think that if anything, I am being conservative with these estimates.

Posted by: veggieburger at January 13, 2006 3:37 PM

I knew Veggie was a broker!! LOL! :-)

Posted by: BronwBomber at January 13, 2006 4:38 PM

For starters the closing costs on the house would be much closer to $40,000. The insurance would be much closer to $300 a month. And $60,000 is a very very small renovation. Furthermore if you put that $375,000 into a good mutual fund you would be getting a $37,500 return on your money in the first year. This is far from a good deal. Like most realestate these days it is only worth it if you love the house and the neighborhood and it will make you happy to live there.

Posted by: samandjoeshow at January 13, 2006 7:09 PM

The floorplan on these apartments is (are?) terrible. Some don't have a living room. People will not pay $1900 for these apartments.

Posted by: DF at January 13, 2006 7:38 PM

Hillbilly, have you ever owned rental property? Your other expenses/repairs category may be correct for some where else, but it's not any where in the ball park for New York City.

Try calling a plumber in the middle of night to repair a leak and see what he charges you.

Posted by: Anonymous at January 14, 2006 8:37 AM

I think Vinegar Hill is a cool, evocative neighborhood, but it is no West Village. It is a big schelp to the subway, it is usually quite deserted, there are no businesses unless you walk to "greater Dumbo". If the residential conversions and some new construction fill in between the Two Trees between-the-bridges stuff and Vinegar Hill, and services improve, then the prices people are asking for today won't seem like reaching. But will that happen? That said, it makes me sad that all the weird, sleepy corners of Brooklyn are becoming un-sleepy!

Posted by: Caledonia at January 14, 2006 11:07 AM

I just realized in the numbers I showed before, I forgot to include the forced "savings" that you do by paying off the mortgage. Although your mortgage payment would be about $4950, initially only about $4150 would go towards interest. $800 of it would be paid off principal. So you would be in effect making an additional $7200 in the first year in income. Additionally, that number goes up a little bit every year. This makes your returns more like 5% for the first year, 6% for the second, 7% for the third, and so on.

Additionally, you get the tax benefits of depreciation.

Most importantly, in 30 years the house is totally paid for, and you start making some REAL income.

The income on this property is decent. You could probably find better income on some other properties, but not any other properties that have the appreciation potential that this one has, being in a nice townhouse in a very desirable location.

I am not saying that this investment is for everyone. I am saying that some investor is going to realize this is a fantastic deal and will buy it. If I had $355,000 lying around, I would definately consider this house.

Posted by: veggieburger at January 14, 2006 12:31 PM

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