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July 17, 2009

Open House Picks: Six Months Later

Comment: Reality finally setting in for sellers?
Open House Picks 1/16/09 [Brownstoner]
Previous Six Months Later Posts [Brownstoner]

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Comments

448 6th is actually listed at $2.149 million now. The price was reduced last week.

Don't understand why they bothered switching from BHS to Corcoran. Switching agencies doesn't sell the house--reducing the price sells a house.

Posted by: bk14 at July 17, 2009 12:43 PM

Wow. $630,000 (so far) is quite a reduction for 6th Street. But there are still plenty of houses - particularly BHS listings it seems - that have been sitting for months at ridiculous asking prices (as posters here have noted).

Posted by: CarrollGardened at July 17, 2009 12:48 PM

agreed wtih CG
it seems that many agencies (Warren Lewis & BHS) more than the others can't seem to face reality and reduce the prices. Corcoran seems a bit more agressive

Posted by: gemini10 at July 17, 2009 12:51 PM

how much was that place rented for?

Posted by: Santa at July 17, 2009 12:53 PM

And 448 6th is actually a really beautiful house. I'm sure that in the bubble in would have sold in the mid-$2 million range. It's very unique. The only real negative I can think of is the living room wall that was removed to make it more open and spacious (since it's a 17-footer). It just doesn't really look right (although it's a common modification in many narrow brownstones). The rest of the house is gorgeous. It needs some updating, of course, but nothing major.

Posted by: bk14 at July 17, 2009 12:57 PM

I feel bad for the owners of 14th street
am sure something happened that they were forced to leave after just buying the place hence the rental
I wonder how much they were able to get in rent....

Posted by: gemini10 at July 17, 2009 1:02 PM

g10, the pace of the price chops means you should plan to rent for more than a yr b4 even thinking about buying something (ie prices likely to still be dripping away).

unless someone was tracking that 6th st house, the 50k reduction is hardly noticeable when you're talking about a 2M+ house. I think the biggest obstacle on that 6th st house is it's a 1 family (ie cuts off some buyers who need that rental income to carry mortgage)

Posted by: more4less at July 17, 2009 1:07 PM

M4L - yeah, am noticing that too. Unfortunately we aren't in the market for 2million dollar homes(more like under 1 mill)

I think the 16th house was a total coup for the sellers. The house has good bones, but needed a lot of renovating and reconfiguring as it seems the 4th BR was tiny and you had to walk through one bedroom to get to it!

Posted by: gemini10 at July 17, 2009 1:13 PM

One weird thing about the 9th Street house is that it came out of the gate at 1.895 about a week or so ago and then almost immediately INCREASED the price by $50K - what on earth were they thinking?

Posted by: Miss Muffett at July 17, 2009 1:13 PM

Comments (mine included) break down less along bull/bear than a.) a lot of macro pseudo-arcana about interest rates, GDP, Case-Shiller, Baltic Dry, etc etc., in an attempt to call what no one in the history of markets has been able to call, bottoms and tops (people get lucky and win a coin flip, so what); or b.) a lot of affective descriptions of how great a house, neighborhood, borough, wine bar, block, public school is. But isn't the truth staring us in the face? No one I know is obsessed with RE anymore; no one I know sees it as a credible asset class above and beyond its consumption value; everyone I know is worried about asset depreciation and job security. With that as a background, and with price appreciation uncertain, who is going to take on staggering debt load to own a house in an iffy neighborhood? I'll call it: massive price reductions in the next six to eight months , or I will happily admit to being wrong, and buy DIBS a beer, armagnac, prosecco, his call.

Posted by: Whuh at July 17, 2009 1:14 PM

"I think the biggest obstacle on that 6th st house is it's a 1 family (ie cuts off some buyers who need that rental income to carry mortgage)"

If you HAVE to rely on the rental income to pay the mortgage you can't afford it. Too many people get themselves in trouble that way. Rental income should be gravy.

Posted by: TownhouseLady at July 17, 2009 1:15 PM

woops, meant my 9th St post for open house picks thread. busy day - back to work...

Posted by: Miss Muffett at July 17, 2009 1:16 PM

If I was a seller (and I was last year) I would definitely go with Corcoran over BHS. They definitely are more aggressive about moving their inventory.

Posted by: wasder at July 17, 2009 1:16 PM

Speaking of featured houses that have gone rental, I noticed on Corcoran today ("most viewed rental") that the owner of 3 Monroe Place, HOTD on June 15 asking $3.995 million, has already given up and gone the rental route. Top floor, 900sft 1 bedroom, for $2500/mo.

Posted by: NorthHeights at July 17, 2009 1:23 PM

Wasder - AGREED!

Posted by: gemini10 at July 17, 2009 1:24 PM

A Corcoran broker friend of mine once advised me to sell with Corcoran, but don't buy from them - since they indeed are quite aggressive with their prices. That said, the notion that "Corcoran" is a homogenous group is a bit of myth since it's really a bunch of self-employed free agents sharing a website and brand on their business card...

Posted by: Miss Muffett at July 17, 2009 1:28 PM

Agree with Wasder and G10. I've bought and sold with Corcoran and personally had good experiences. I've not been so lucky with BHS in both selling and renting.

Posted by: CarrollGardened at July 17, 2009 1:35 PM

THL, sad but still true. I suspect there's still a ton of people out there who is banking on that rental income to afford the house.

Posted by: more4less at July 17, 2009 1:36 PM

"If you HAVE to rely on the rental income to pay the mortgage you can't afford it. Too many people get themselves in trouble that way. Rental income should be gravy."

Delusive much? Rental income can be & is congenital to an investor, especially now.

Gravy? lets try leaving the aureate aura at log-in.

Thanks.

Posted by: Brooklynchimp at July 17, 2009 3:09 PM

"Reality finally setting in for sellers?"

No, they'd be in contract.

"how much was that place rented for?"

Fundamentals WOULD have it at 2,150,000/(10 x 12) = $17,917/mo. In Southie.

***Bid half off peak comps***

Posted by: Brownstones Half Off at July 17, 2009 3:46 PM

448 6th Street just reduced from $2,149,000 to $2,099,000 in the last hour.

Posted by: bk14 at July 17, 2009 4:47 PM

LOL, real time reductions.

Posted by: mopar at July 17, 2009 10:58 PM

BrooklynChimp,

Let's not kid ourselves. If you buy a two family and are reliant upon that tenant paying on time every month what happens if they stop? They lose their job, they're just being crappy because they don't like something you decided didn't need fixing etc.? Then what? Default on your mortgage payments?

I stand by my original statement, if you HAVE to rely on the rent roll then you can't afford the house.

Have you learned nothing from this economy with everyone stretching themselves too thin? Use the rent to fund your retirement, your kids college fund, or pay down the mortgage early. Just don't get yourself in a situation where if the tenant defaults, you then default. That's just really bad advice.

Posted by: TownhouseLady at July 18, 2009 9:13 AM

Folks buying 2 million dollar homes don't "rely" on their upstairs rental unit to pay the mortgage. That's plain nuts.

But plenty of multifamily apartment building owners sure as heck rely on rents to pay their mortgages, and as more and more big buildings go into foreclosure, or are sold for big losses, the entire Brooklyn housing market (Park Slope brownstones included) will keep tanking.

Posted by: IronBalls at July 18, 2009 9:45 AM

Re: Corcoran vs BHS -- both of them have some good, straight-talking agents and some sharks. But in my sad experience, it is by no means always the brokers pricing things unrealistically. Frequently the sellers are the ones who have a number in their heads and won't change it, no matter how hard the agent tries to talk to them about market realities. We've been looking for ages now and I have seen several properties get taken off the market by owners who wouldn't consider an offer that was more than 5% lower than the (delusional) asking price. The brokers just want to sell.

Posted by: gidgetgoesbrooklyn at July 18, 2009 2:31 PM

Wow, gem, you sold your place really fast, it sounds like.

Posted by: mopar at July 18, 2009 11:22 PM

Oh absolutely IronBalls. We're on the same page.

The initial comment that sparked my response was:

"I think the biggest obstacle on that 6th st house is it's a 1 family (ie cuts off some buyers who need that rental income to carry mortgage)"

I was never talking about multi-unit buildings.

Posted by: TownhouseLady at July 19, 2009 2:52 PM