« Last Week's Biggest Sales House of the Day: 45 Park Place »

April 7, 2009

Co-op of the Day: 32 8th Avenue

This floor-through co-op apartment at 32 8th Avenue in Park Slope is the best deal we've seen in a while. The 900-square-foot one-bedroom has all of the exquisite detail one would hope to find in a Park Slope brownstone, from the beautiful wood moldings to the inlaid parquet floor. A small extension on the rear of the building also means that they layout works much better than your standard floor-through conversion. We're going to go out on a limb and say that we wouldn't be surprised to see this go for more than the asking price of $599,000, which would be quite an achievement in this market!
32 8th Avenue [Corcoran] GMAP P*Shark

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Comments

That is a really nice apartment. Definitely one that might hit ask in this crazy market.

Posted by: wasder at April 7, 2009 12:54 PM

It'll probably go somewhere between $550 and ask ... both of which are more money than a 1 BR should rightfully cost, but the location's killer and the interior's nice.

Posted by: cwbuecheler at April 7, 2009 12:55 PM

665 a foot, why not. the meier building is still going for 1100 a foot right across the traffic circle. they should ask a little more.

Posted by: joe_the_bummer at April 7, 2009 12:59 PM

Absolutely lovely apartment. And large for a 1 bedroom.

I hope they get close to their asking price on this one.

Posted by: 11217 at April 7, 2009 1:00 PM

Interesting reconfiguration. But it is at best a compromise for a single person.

There's something sad about making what was once someone's parlors into your whole house, especially if they had to rip out the fireplace and put a bathroom into the middle of it. I'd rather live in an original apartment or a whole house.

Posted by: mopar at April 7, 2009 1:01 PM

I mean, if I were buying. As a renter, it's OK.

Posted by: mopar at April 7, 2009 1:01 PM

Very close to ask, if not at ask.

Posted by: daveinbedstuy at April 7, 2009 1:03 PM

Why would corco omit pics of the kithchen? Some of the original details are lovely but overall, I'm not too impressed.

Posted by: cggirl at April 7, 2009 1:14 PM

"Small extension"s can often mean a drafty place, as the extended part has three outside walls.

Posted by: infinitejester at April 7, 2009 1:16 PM

I shudder when I see a price this high for a 1-bed. Particularly since 1-beds seem so transitional. Even confirmed singles usually want an extra bedroom for an office, storage or just for guests.

That said, I haven't seen a 1-bed this beautiful in a long, long, time. I can't think of one improvement I'd make (although we haven't seen the kitchen have we?).

Posted by: TownhouseLady at April 7, 2009 1:18 PM

Depends upon whether it was properly insulated and the windows are thermalpane. It gives more light for one thing.

Corcoran are idiots for not including two extra pics...bathroom & kitchen.

Posted by: daveinbedstuy at April 7, 2009 1:20 PM

Great Location, Great building - lots of space
very close to asking - 550K
but again - I will never be in the market for a 1 BR so I still think the asking price is steep - but again, great location

Posted by: gemini10 at April 7, 2009 1:24 PM

THL -- agreed. I've been running the numbers on the buy/rent decision, and I'm shocked to see how long you have to stay in a place for the transaction costs to amortize to the point that you're better off buying.

I have a spreadsheet. what would you guess for rent on the same place 2250/mo? -- also prop tax? I'm guessing about .25%/yr? closing costs 30K, selling costs 6% + 5000?

I'll tell you what I get for the break-even time for various price appreciation scenarios if you want to help me with the inputs.

Posted by: joe_the_bummer at April 7, 2009 1:29 PM

525K gets it sold. Since it's a coop, closing costs about 4K, prop tax $1,500, rent 2250 sounds about right.

Posted by: DeLepp at April 7, 2009 1:37 PM

nice pied-a-terre. Very attractive and with an excellent location. Perfect for a confirmed bachelor/ette or as a love pad for a mistress. Not so good for an older person due to the lack of elevator.
Properties like this one will sell even in this climate. Although not for ask. I guess it will go for $525,000 or so.

Posted by: sam at April 7, 2009 1:41 PM

This is the most perfect 1-bedroom in the most perfect street in the most perfect neighborhood.

Posted by: bayridgegirl at April 7, 2009 1:42 PM

I think you might be underestimating the rent a bit.

Here's a very similarly sized 1 bedroom in Park Slope renting for $2500.

http://newyork.craigslist.org/brk/abo/1111316475.html

And another for $2700

http://newyork.craigslist.org/brk/fee/1111054400.html

Posted by: 11217 at April 7, 2009 1:43 PM

Joe, add on moving costs to that as well.

Posted by: TownhouseLady at April 7, 2009 1:50 PM

I bought my place FSBO. No reason to use a broker. Take that 6% off. Most of us here know more about real estate than half the brokers in the area, anyway... ;-)

Posted by: 11217 at April 7, 2009 1:53 PM

OK -- here's what I did. Using deLepps #s, and the following assumptions: 10% down, 4.75% 30yr fixd, 40% total income tax rate (incl. fed, state, city), tax deductable mtg interest, 0.25% property tax (=1246/yr initially), maintenance cost never increasing

I took the after tax monthy cost after amortizing the profit and the transaction costs from selling the place.

A: property value flat, rent flat over time: you never break even. round-trip ownership costs get down to about 3000/month after about 10 years

B: property value down 1% a month for 1 year, and then resuming 2% growth per year, 2% rent increase every year: you break even after 12 years.

C: property value up 5% a year. after about 1 1/2 years you're doing better than renting, and after 12 years you turn a profit.

D: same as B, only resuming 5% price growth per year. You break even vs renting after 5 years, but don't turn a profit until you hold it for 24 years.

I realize that I am seriously lacking a life. whatever; this question always bugged be, and I finally did the work. It gets more complicated when you consider the foregone gains from investing your downpayment in the market, but I can elaborate on that later.

Posted by: joe_the_bummer at April 7, 2009 1:58 PM

I'm curious to see what others think places around this area should go for in $/sf. At the height of the market I'd read they were averaging about $800/sf.

Apartments in my building, a nearby brownstone, went for over $900/sf in early 2008.

11217 is right about the rent rates.

Also, how deep do you think this building is? Is there a back yard?

Lovely apartment. Too bad the bedroom is on the front of the building, though.

Posted by: Bessie at April 7, 2009 2:05 PM

beautiful apartment, though $599,000 seems a bit much for a one bedroom in this market. This isn't even something you could pitch as "convertible." I'd say no more than 525, 550 at best.

Posted by: clintonhillbuyer at April 7, 2009 2:05 PM

11217 - that's what always gets me about great apartments in great areas - they sell themselves and there's no way you need to put 6% in to the pocket of a broker. When we sold our Park Slope apartment in 2005, we built a little website, drew up a floor plan and posted pictures of every room and aspect. We heard from our eventual buyer in 14 hours after the ad went up, heard from their spouse 4 hours later (and they didn't know their better half had already emailed) and we had a deal with them in 72 hours. And we ended up getting $75k more than a Corcoran broker had told us we'd get.

Yes, we were lucky in that we found someone who loved our place immediately and never needed to have an open house, however even in a down market, great neighborhoods are still in demand and with a NY Times ad and a website more often than not I think you can do better (and split the 6%) than going with a broker.

Of course borderline areas can be a different story. There it's more likely a broker will earn their commission by bringing buyers who mightn't look in that particular area without some prodding.

Posted by: 99luftballons at April 7, 2009 2:09 PM

If you're willing to spend 600K on a one-bedroom, you're better off spending 600k on a two bedroom.
There's a cute 2-bedroom on Willow Street in for 600K.

Park Slope is not the end all.

Posted by: bayridgegirl at April 7, 2009 2:09 PM

Hey Joe,

So which of those most closely resembles the NYC real estate market, in your opinion? Cause I'd say D. None of the above

C. is technically I think where we're "supposed" to be at, I believe.

But I suppose this time things might be different, but in the past the multi-year busts have been followed by a multi year boom of 150% appreciation. This has happened in each of the last 3 housing cycles.

Down 24% in the 90's bust, up 157% in the following boom...and so on...

Posted by: 11217 at April 7, 2009 2:09 PM

man, this is a nice looking unit, great location, good size, love that parlor flr ceiling height. Even I have to put away some of my gloom and say $575k - predicting someone from Man trades in their pricey studio or small 1-bdrm for this gem.

think bath & kitchen are so so else no reason to not post pic's unless the agent is super dumb.

Posted by: more4less at April 7, 2009 2:10 PM

oh silly me; I haven't learned anything; I forgot to provide the link:

http://www.prudentialelliman.com/Listings.aspx?ListingID=1090217&rentalperiod=&SearchType=apartments&Region=NYC

Posted by: bayridgegirl at April 7, 2009 2:11 PM

11217, huh. if you can do that, you only need a tiny bit of appreciation to beat renting. 2% annual price increase gets you there in a year, and turns a profit in two. but if you jump too early and swallow a 10% price decline in the first year, it takes you 10 years to break even with renting (assuming rents stay flat).

you're right. who needs a realtor? no one deserves 35K for selling a place like that when every possible comp is all over the web.

Posted by: joe_the_bummer at April 7, 2009 2:16 PM

I don't see the comparison to the Brooklyn Heights apartment and the Park Slope apartment at all, regardless of neighborhood.

One is in an apartment house which requires 25% down and $1283 a month maintenance.

The other is in a small brownstone co-op (literally feet from Prospect Park) which requires 10% down and $637 a month maintenance.

I feel that the buyers for each apartment do not overlap.

Posted by: 11217 at April 7, 2009 2:17 PM

This place looks great. It only takes a couple of folks to start bidding against each other to get that price right around the ask. I think this will sell and sell quickly. It's in a great location, looks awesome and is priced to sell IMHO. Would not be suprised by 600+

Posted by: 10thStreetReno at April 7, 2009 2:17 PM

E. Continuing price declines for 2-5 years. Zero growth for 5-10 years thereafter.

Posted by: SnarkSlope at April 7, 2009 2:18 PM

Snark,

Although I guess anything is possible, do we really think that a city like NYC will have zero growth for 10 years?

In a couple years all of the inventory will be bought or rented up, since building has all but come to a halt.

If anything remotely like the predictions about more people moving to NYC come true, there is going to be a serious housing shortage in NYC in the coming decade.

Posted by: 11217 at April 7, 2009 2:21 PM

11217, I'm pretty bearish, which is why I left it view-neutral.

THL BTW i left out moving costs assuming renters have to move too.

Posted by: joe_the_bummer at April 7, 2009 2:21 PM

Question,

In NJ the seller pays the RE Agent fee 6% to the sellers agent and the seller and buyers agent split that fee (3% each). The Buyer does NOT pay any fees to the (buyers) agent.

How does the work in NYS?

Posted by: TownhouseLady at April 7, 2009 2:22 PM

Duh- very true Joe!

Posted by: TownhouseLady at April 7, 2009 2:22 PM

snark, how much down? I'll run it.

Posted by: joe_the_bummer at April 7, 2009 2:23 PM

Usually the same, THL. Except that many greedy brokers in NYC won't split fees at all sometimes.

Posted by: daveinbedstuy at April 7, 2009 2:25 PM

Thanks Dave, I thought so but was getting a different gist after reading some of the comments.

Posted by: TownhouseLady at April 7, 2009 2:26 PM

Who the heck keeps appraising these properties *WAY* higher than a rational price? Mr. B, you really need to insist on one-appraisal-per-user limit, as well as ideally making the appraisers transparent (maybe a link where you can see which user offered which appraisal).

Posted by: Miss Muffett at April 7, 2009 2:30 PM

in NJ, buyer sends seller a contract with the offer vs. NY is other way around. Other than that, dont recall much of a diff btwn the two

Posted by: more4less at April 7, 2009 2:31 PM

Most places in the country the buyer sends the contract to the seller.

Posted by: daveinbedstuy at April 7, 2009 2:33 PM

Miss Muffett, I already asked about the one vote per person limit and there is one.

Posted by: TownhouseLady at April 7, 2009 2:34 PM

there is a one-appraisal limit. 1 or 2 outliers shouldn't make much of a diff if 50 or 100 people are voting. the allowable range is capped at within 40% of the asking price so you can't go too nuts.

Posted by: brownstoner at April 7, 2009 2:34 PM

NJ also requires that the seller use an attorney. I don't think that's the case in NY??

Posted by: TownhouseLady at April 7, 2009 2:35 PM

MM - i actually think there are more irrationally low 'appraisals' on these widgets than high. Looks like there are at least 4-5 below 400K for this. So I assume it evens out.

Posted by: squaredrive at April 7, 2009 2:36 PM

So typical MM. While yes...someone did vote for an absurdly high price on this one and most others (last week I suggested we throw out the highest and lowest bids) but why do you not make a comment about there being an absurdly low one also...370K...?

You continually talk down the market, which in your position is what you need to do, I suppose, but it really makes for a monotonous and sometimes foolish appraisal of where things REALLY stand in the market when you aren't able to articulate both sides.

Posted by: 11217 at April 7, 2009 2:36 PM

Miss Muffett, if you look back you'll also notice that there's always one killjoy that votes the price down to the lowest range as well. It balances.

Posted by: TownhouseLady at April 7, 2009 2:37 PM

> "do we really think that a city like NYC will have zero growth for 10 years?"

I can't speak for "we" but I can speak for me. Why would you expect the population to increase dramatically? Are millions of people going to wake up and say,"Hey I'm unemployed and broke, I'm moving to the most expensive city in the country..."

Posted by: SnarkSlope at April 7, 2009 2:37 PM

LOL Snark!

Posted by: TownhouseLady at April 7, 2009 2:39 PM

F. Continuing price declines for two years, crazy growth again after that, but still takes eight to ten years from now to get back to 2006 prices.

Posted by: mopar at April 7, 2009 2:40 PM

Only someone not well acquainted with NYC history would assume that the City will grow in the next ten years. Most of the latter part of the twentieth century the city shrank. down from its peak in the 1920's. That peak was finally surpassed by 1998 or so. The growth of NYC is inexorably tied to foreign immigration. Without a constant flow of immigrants, the net population would shrink.
So it would not be at all surprising that contrary to Mike Bloomberg's 2030 plan, the city could lose population rather than gain it. And it will shrink if the local economy keeps shedding jobs. No one moves to NYC for the climate or the easy life style.

Posted by: sam at April 7, 2009 2:43 PM

11217, regardless if my link is a true comp or not, 600K for a one-bedroom is ridiculous. There are better / bigger apts in other nabes. I don’t have time to look for listings to post.

While the apartment is nice, someone has to be sooooo in love with the neighborhood to pay this price.

Posted by: bayridgegirl at April 7, 2009 2:45 PM

Or, sam, the next 10 years might not look anything like the "latter part of the twentieth century."

Interesting that the mid 1990s was when the city finally pulled itself out from the burden of debt, mismanagement, inept mayors and high crime...which is where it largely remains today.

Posted by: daveinbedstuy at April 7, 2009 2:47 PM

ok snark, for kicks, I put in 1% per month decline for 36 months, bringing it down from 525 to 366 in 3 years, and then flat for 10 more years, and then up 5% per year for the remainder of the 30 year mortgage, for sale by owner. no increase in maintenance or rent. It takes the whole 30 years to break even.

however, if you let rent (and maintenance, to be fair), go up 2% per year, you break even in 18 years.

Posted by: joe_the_bummer at April 7, 2009 2:47 PM

"Only someone not well acquainted with NYC history would assume that the City will grow in the next ten years. Most of the latter part of the twentieth century the city shrank."

I actually WAS going by NYC history. Notice the period after the Great Depression, and I'm also curious Sam if you could show me precisely where "MOST of the latter part of the twentieth century the city shrank"....

1698 4,937 —
1712 5,840 18.3%
1723 7,248 24.1%
1737 10,664 47.1%
1746 11,717 9.9%
1756 13,046 11.3%
1771 21,863 67.6%
1790 33,131 51.5%
1800 60,515 82.7%
1810 96,373 59.3%
1820 123,706 28.4%
1830 202,589 63.8%
1840 312,710 54.4%
1850 515,547 64.9%
1860 813,669 57.8%
1870 942,292 15.8%
1880 1,206,299 28.0%
1890 1,515,301 25.6%
1900 3,437,202 126.8%
1910 4,766,883 38.7%
1920 5,620,048 17.9%
1930 6,930,446 23.3%
1940 7,454,995 7.6%
1950 7,891,957 5.9%
1960 7,781,984 −1.4%
1970 7,894,862 1.5%
1980 7,071,639 −10.4%
1990 7,322,564 3.5%
2000 8,008,288 9.4%
2007* 8,274,527 3.3%

Posted by: 11217 at April 7, 2009 2:47 PM

I'm going to go along with Mopar's prediction. Sounds very reasonable to me.

Posted by: TownhouseLady at April 7, 2009 2:54 PM

I went to the open house on Sunday. Absolutely lovely details but the bedroom faces the street which made me uncomfortable and the kitchen needs an update (hence why there's no pics of the kitchen). And I agree with an earlier post - if you're going to spend that money why not buy a two bedroom you can grow into? All that being said, it was lovely.

Posted by: brooklyncurious at April 7, 2009 3:21 PM

"11217, regardless if my link is a true comp or not, 600K for a one-bedroom is ridiculous. There are better / bigger apts in other nabes. I don’t have time to look for listings to post."

I agree with that sentiment. 600K is a lot for a 1 bedroom.
But there are far more expensive 1 bedrooms in this city to be had. There are a whole slew of 1 bedrooms in Manhattan for sale for over a million...some of these are not even 800sf...

http://www.corcoran.com/property/listing.aspx?Region=NYC&ListingID=1409452&ohDat=

http://www.corcoran.com/property/listing.aspx?Region=NYC&ListingID=1186964&ohDat=

http://www.corcoran.com/property/listing.aspx?Region=NYC&ListingID=1453373&ohDat=

Posted by: 11217 at April 7, 2009 3:24 PM

11217: you have a point. I was recalling that the population of Manhattan (not the whole city) peaked in the 1920's. Naturally the outer boros kept growing as more and more development took place dusing the 30's, 40's and 50's.
Still and all, I stick to my premise that people move to NYC for jobs. If the job market shrinks, the population will decline especially as many people who reach retirement age move out to warmer more affordable places. The future is unknowable but if we can learn anything from the patterns of history, it is that conventional wisdom is usually turned on its head every thirty or so years.

Posted by: sam at April 7, 2009 3:30 PM

sam don't give up so easily! the pop in 1990 was less than it was in 1940. it's right there in the numbers.

I also think the population will shrink in the next few years, as more people lose their jobs and re-think NYC.

But the real damage to home prices will come from the change in total city income and wealth, not population. by that measure the city is dramatically shrinking.

Posted by: joe_the_bummer at April 7, 2009 3:37 PM

Yes, the population of Manhattan did seem to peak in the 1920's, although it has increased during the past 2 decades.

In any case, since *generally* it would seem the entirety of NYC is continuing to grow (I attribute the only really substantial decrease from 1970-1980 due to "white flight") it would make sense that this is better news for Brooklyn and the other outer boroughs. Well if one considers more people good news...

There will certainly be older people moving to warmer climates I suppose you have to also factor in that NYC has become kid heaven. The number of children under 5 in NYC has gone through the roof in the last decade. It's my impression that lots of kids who grow up in NYC end up staying or at least coming back after college. More than those raised in other parts of the country, it seems.

So many kids being raised in the city again now will be interesting to track and see what happens...

Posted by: 11217 at April 7, 2009 3:39 PM

"I also think the population will shrink in the next few years, as more people lose their jobs and re-think NYC."

For it to shrink, we'd need to go below 8,008,288 (the 2000 census number).

From all reports I've heard, we are past the 8.3 mark at this point and some say 8.4.

Do you really think that 300,000-400,000 are going to be leaving the city in the next year? You do realize that lots of people who have lost their jobs WILL find new ones, right? Many won't, but to assume that these Finance people who made 10 million a year and are now laid off are going to bolt for Cleveland is odd to me.

I guess we'll find out in the next census.

Posted by: 11217 at April 7, 2009 3:42 PM

> "For it to shrink, we'd need to go below 8,008,288 (the 2000 census number)."

No, for it to shrink, it has to go below the estimate of 8.3 to 8.4.

Posted by: SnarkSlope at April 7, 2009 3:52 PM

11217, I do think some of them will bolt -- if you've made 10MM, and you're faced with making 200K, you quit, and you go open your bookstore in Boca. I'm more worried about the rank and file who were in the 300-500K range. Not rich by NYC standards, but making more than almost any other profession would allow. the "before" picture is a 3-BR and private school for the kids. The "after" is neither of those things. But I don't know, I'm just projecting the situation of myself and everyone I know. The total wealth/income effect is the real point I'm trying to make.

Posted by: joe_the_bummer at April 7, 2009 3:53 PM

this is a great 1 BR in a great location. However, at this price point of 550-600, i think many people are going to head south to 4th ave or cross nearby flatbush and find 2 BR's for roughly the same price and prob even more sq footage. Who knows though, if you gotta be near the 2/3 and Prospect Park, this one seems perfect.

Posted by: bktycoon at April 7, 2009 4:01 PM

that came out more smug than I meant it

Posted by: joe_the_bummer at April 7, 2009 4:01 PM

to quote the great yogi berra:
"the place is so crowded that nobody goes there any more".

Posted by: sam at April 7, 2009 4:12 PM

from the floorplan, calling that 900 sf is a bit of an exaggeration. Unless you count the common hallway.

Posted by: Frederick Law Homestead at April 7, 2009 4:23 PM

quote:

No one moves to NYC for the climate or the easy life style.

lol. i actually did sam.

*rob*

Posted by: PitbullNYC at April 7, 2009 4:34 PM

Didn't think you were being smug at all Joe.

I like your posts.

Posted by: 11217 at April 7, 2009 4:55 PM

I'm guessing that a lot of real estate agents who read Brownstoner are inflating the prices on the widget. It's in their interest individually and collectively to do so.

I saw the apartment on Sunday, too, and was disappointed, despite some of the nice details.

First, the bedroom on the parlor floor overlooking busy 8th Avenue is absolutely untenable.

Just as bad, there are security bars on every window. It would feel like living in an expensive (and rather gloomy -- not much sunlight) cage.

Posted by: zuleika at April 7, 2009 6:18 PM

Well, so much for this property. $350,000.

Posted by: mopar at April 7, 2009 6:30 PM

You are definitely paying for location with this one. Its a nice apartment, but not $599K nice. Thats close to the highest price for brownstone one-bedrooms even at the top of the market. And the bedroom faces the street and the kitchen and bath need updating. I cannot see anyone sane bidding near ask for this.

Posted by: saminthehood at April 7, 2009 7:31 PM

You real estate agents have nothing better to do while sitting at your office desks than to keep trying to prop up real estate prices do you? The cat is out of the bag. Real estate is going down down down and the people waiting on the sidelines are not going to fall for your bull now just like we didn't fall for it during the housing bubble. There are few suckers left to get scammed into paying half a million dollars for a one bedroom condo, The price for a one bedroom condo is less then 200,000 dollars and I don't care in what part of brooklyn it is in.

Posted by: hannible at April 7, 2009 10:48 PM

Hannible is the voice of reason.

Posted by: mopar at April 7, 2009 11:55 PM

Thank you mopar just trying to put some reason into the heads of people that have ruined this country with their own greed and speculation. They should be ashamed of themselves.

Posted by: hannible at April 8, 2009 5:58 AM

I've seen this apartment and the bathroom really is beautiful. Actually one of the selling points, not sure why they didn't include a picture. And the kitchen is large with two windows and room for a table. I think it is a steal at the asking and will go for higher and so close to the park.

Posted by: pbishop777 at April 9, 2009 8:13 PM

This property was sold back in 2004 for $515k according to PropertyShark.com:
http://propertyshark.com/mason/nyc/Reports2/showsection.html?propkey=144980

We went to this open house today and there's a reason the kitchen isn't one of the pictures on display -- it will need a complete overhaul to make it worthy to sell for $599k.

The bedroom needs some work too -- the closet doors are completely out of character compared to the rest of the apartment's details.

- $15k kitchen renovation.
- $5k to replace all the windows' glass from single pane (huge loss of energy efficiency + noise reduction), which may not even be possible due to the building's landmark status.
- Another $2-4k in wood matching & refinishing & modifications throughout.

$599k - $15k - $5k - $4k = this place should go for $575k tops, and that's inflated considering the previous owners' purchase price (and the fact that they haven't put any work into the place since the previous sale...)

Posted by: mfischer at June 7, 2009 10:35 PM

« Last Week's Biggest Sales House of the Day: 45 Park Place »

April 7, 2009

Co-op of the Day: 32 8th Avenue

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