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July 18, 2008
"Winning" HPD Lottery for the Toren
I "won" the lottery for an income restricted apt. at 150 Myrtle Ave in Brooklyn.
http://www.torencondo.com/
We have a letter saying we can set up an appiontment for an interview and to bring in all of our paperwork etc. At first we were excited as I was hoping that this was going to be an opportunity to buy a great apartment at a good price, but the available apartments are all studios and one bedrooms which range in price from 420,000 to 330,000 and 720 sf to 400sf. All of the apartments are on lower floors and they have lower quality fixtures. When I look at the Toren/Halstead listings there are quite a few apartments that are listed as SOLD, but the sales price for the open market apts. is only ten percent more than for the lottery apts. I also think that the actual sales prices for the open market apts. is lower than is published.
http://www.halstead.com/developments_other.aspx?numb=65857
So I am very confused why I am expected to feel like I have a great opportunity here?
Is something wrong with this system, we were so excited at the prospect of winning the lottery, but now feel like it is a scam, with pressure to buy without seeing the apartment and at prices that appear very close to the market rate.
There are also restrictions on selling the apartments, you have to live in them for a certain number of years.
Am I missing something?
I'm also not crazy about the location or the prospect of living on a third floor facing Flatbush Ave.
Hopefully Real Estate will stay flat if not drop more, our savings will increase and we can actually buy something we (wife and 1.5 year old)love in a nice neighborhood in the next couple of years...Or am I missing a great opportunity here??
Comments
If it smells like a fish..... not that I know any details, but it sounds like you have the right instincts about the situation. Trust yourself -- go ahead and check it out without making any commitments and see if you gain any other insights. Good luck!
Posted by: Schultz at July 18, 2008 11:50 AM
Congratulations but remember "beggars can't be choosers".
Posted by: pierre de taille at July 18, 2008 11:51 AM
I'm not sure you can really call it a scam. The developer is likely following the letter of the law here, but not trying to go above and beyond that, and I'm not really sure you can expect that private developer should do any more than that.
It's worth checking out- and there's no one forcing you to buy. Part of this also probably has to do with their needing to set the lottery prices early on in the legal process, and that they typically hold off on the retail prices as long as possible to feel out the market. In this case, the market moved towards the affordable side, instead of the other way, as it had happened in past years, so there is a smaller difference between them. That's just a guess, though.
Posted by: Park Place at July 18, 2008 12:10 PM
Thanks for the comments, We were thinking of checking it out...But the way the have the process set-up is you have to give your deposit way before the building is finished. So what if you don't like the apartment? You can't sell it until you have lived there for 15 years!
I think we will pass.
We really wanted to win the Classon Ave PACC lottery though!
I have been calling and emailing the Halstead agent that is handling the HPD lottery, but he has not returned my calls..
Posted by: Dan76 at July 18, 2008 12:26 PM
With all the unsold units in buildings all over Brooklyn, you will be able to find something that is better suited for you at the market. I would stay put, scope out new buildings with units that you might like and keep an eye on them. It will nto be long before the developers start playing "let's make a deal." And someof those that were sold at preconstruciton may never close.... people may walk away from them (happens when they can't get a mortgage).
Posted by: BH76 at July 18, 2008 12:37 PM
I think that the lottery for Toren is probably not as good of a deal as other lotteries, because I've heard sales there have been robust. You can oftentimes also count on market rate prices rising as more units sell (even in a declining market). If you don't feel comfortable, I wouldn't do it, but I do think Toren is probably the nicest new building being built in Brooklyn right now, aside for the Richard Meier one on Prospect Park.
Posted by: 11217 at July 18, 2008 12:53 PM
I know a little about this building ...
The resale restriction is realted to income, not an absolute ban on sale. Prospective buyers must meet the same income eligibility guidelines you had to meet. The lottery units are on the first five floors, market rate units are in the tower portion. Kitchen appliance packages are different, othewise all units will feature same fixtures, floors, countertops, etc.
With any new construction, you will be going into contract before building completion, and without having seen the finsihed unit. For market rate places, this usually is a risk worth taking if you think the property will have appreciated by close. In this case as a lottery beneficiary, you have built in equity though the subsidy which lowers your risk greatly should prices fail to appreciate.
Regarding available units, some two beds were available but those were snapped up early. Those places had the biggest % of discount relative to the market units. The studios and 1 beds are definitely less of a bargain.
Regarding the "bargain" issue, it's all relative. This isn't a low income project. If it were, you and your family would likely not have qualified and you wouldn't have the opportunity to live in a building of this type, full service, high amenities, etc. So no, the Toren lottery isn't a case where you'll get in the door for half off for for a super low price, what you do get is a discount on a nice building that isn't available to the non lottery buyers.
Like other posters said, trust your instincts but just thought I'd clarify on a few points.
Posted by: brine deez at July 18, 2008 1:41 PM
-Brine,
Thanks for your comments.
There is only one 1 bedroom apartment that is adequete space (706sf) the rest are 600sf.
This still might be too small for three people and no guarantee that it will available.
I did speak to the agent at Halstead who was helpful and honest. He also said that we can sell the apartment as soon as we like.
Agree that the amenities look very nice, but not sure if they are necessary for us. I would prefer space and location.
Still, part of me is tempted as it is a discounted price (albeit a small one). I think we might pursue further in order to make up our minds 100%.
Thanks to everyone who commented and please leave any other thoughts you can.
Dan
Posted by: Dan76 at July 18, 2008 2:05 PM
One bedroom at 600 s.f?? That's a large studio. How is it that the size of the average American house has increased some 40% in the last 20 years and the size of the average apartment in NY has decreased by almost the same amount AND storage is replaced with extra bathrooms and w/d. (I like both, don't get me wrong, but isn't there a way to have both).
Re the resales: the income restriction is one point to consider, but there may also be a penalty (usually fairly modest) if you "have" to sell. Check the prospectus. You should also note how long after the closing date they provide for you that they STILL can close without penalty. It can be fairly long and your money is tied up during that time. It's only after that point that you can break a contract without losing deposit.
Also to consider: by the time the building is finished, your 1.5 year old may be a 2.5 or 3 year old who probably needs a little room of her own. (Rather mommy and daddy need a room of their own, baby stuff doesn't need to take over the remaining space). Good luck!
Posted by: Minmin at July 18, 2008 4:52 PM
600sf would be HUGE for a studio.
Most are in the 300-500 range.
600sf is pretty standard for a 1 bedroom. 750sf is considered spacious.
The average American home size is most likely on the decline for the coming years.
Posted by: 11217 at July 18, 2008 6:20 PM
Hey Dan, let's keep in touch. I also just "won" the lottery and am wondering what to do. Did the Halstead agent mention how many people are waiting in line to buy these apartments? I'm a single woman, so I have less of a problem with the space issue but I still find the liquidity issue a bit hard to swallow.
Posted by: fishie at July 19, 2008 12:35 AM
Hi Dan, My husband and I are in.
We are currently in contract for a 2 bed/2 bath lottery apartment at the Toren. We won too.
Also, to clarify a few things for you. The affordable units are IDENTICAL to the market value units: identical in quality and construction-including all fixtures (sinks, tub, faucets, etc). The only difference is that your appliances will be in the elite stainless steel category instead of the pro line. After reviewing the offering plan, I actually went online and compared all of the appliances (fyi, each unit includes the washer/dryer) which was fun and informative. The only restriction with the Toren is that you can only sell to someone who falls within the income restricion. I've crunched my numbers to death, and my husband and I decided that we could definately make a good chunk of money if we play our cards right (again, we won a 2 bed so our deal is probably better). I also spent a great deal of time speaking with my lawyer (happy to recommend her if you need someone) evaluating the situation and she was super helpful and advised us to move forward. Of course, this is only a decision you guys can make. We also have a 1.5 year old daughter (would love to have lots of parents in the Toren! Pool dates, babysitting exchange!) so I understand the equation is more complicated.
My advice is to proceed. Get approved and then get your Offering Plan and have a lawyer check it out. Until you enter into contract and send in a check, you can pull out. Keep in mind too that you can always sell (never with a penalty)-you are not trapped which was a big plus for us.
Anyway, feel free to contact me personally if you want
Posted by: leiteas at July 20, 2008 10:53 AM
Here is my email: leiteashleigh@hotmail.com
Posted by: leiteas at July 20, 2008 10:55 AM
Dan you can also get in touch with me at biggiefish@hotmail.com
Posted by: fishie at July 21, 2008 12:02 AM
The Toren "affordable" apartments are a scam. You get what you pay for. As you said, they're barely cheaper than the market ones, have worse fixtures, and are only a couple floors above Flatbush Extension -- serious noise! I'd pass.
Posted by: zinka at July 21, 2008 12:52 AM
i'm also a lottery winner and i'm surprised they still have the affordable units available. i had heard that all 42 affordable units have been spoken for. at the moment, according to streeteasy.com, there are 62 units in contract for the market rate units. with the affordable units the building is 43% sold/in-contract.
for those who are in contract at the toren, there is a google group set up. go to http://groups.google.com/group/toren to get approved. this may be a good source to get more info from another people who are in contract.
Posted by: 11205waverly at July 21, 2008 11:58 AM
nother "winner" here. I recently received (by accident), a letter from Halstead saying I needed to respond, etc. It's by accident b/c I'm already in contract. The Halstead guys are nice but slightly sloppy. Anyway, the letter showed what units were available - only studios and ones. None seemed appropriate for a family. I think the studios are going to be a tough sell since they aren't outrageously cheap.
My only (major) gripes with the design of these units, particularly for the smaller ones is lack of closets. Some of the studios have one closet! If the building had storage space it would be acceptable but since it doesn't the layouts take a hit in my opinion.
On a different note, don't know about you guys but I'm not too concerned about noise (for some reason). A) this NY and you get used to it, and B) I have faith this is being constructed with noise in mind.
thanks for the tip about the google group.
Posted by: LilBitOfLuck at July 21, 2008 12:26 PM
Affordable housing in NYC is anything but. The formulas used to qualify as affordable housing is biased assisting the developer with tax advantages and giving the rest of us, for the most part, a very small break from market rate.
Posted by: SenatorStreet at July 21, 2008 1:31 PM
For those interested in this discussion, curbed has a new post about the recent cladding activity on the building. And since we're on the subject, I don't have a link handy but on skyscraperpage.com, if you go to the forums section, there's a forum for Toren which has info, pictures and links to other discussions about developments in downtown BK.
Posted by: LilBitOfLuck at July 21, 2008 2:15 PM
I got a letter from Halstead on 7/6 statying that I won and they have 6 units (1 bed) left. I got the pre approval yesterday and will meeting the agent on Monday....not sure though. This is being offered at about $700 per sqft.....
On streeteasy....# 2407, 609 ft² $821per ft²....so it looks like a bit of a deal.
Don't know the area well and plan to check it out this weekedend.
Posted by: asad at August 8, 2008 9:38 AM
After several research and analysis the Toren lottery pick is not worth the price for one bedroom or studio. I look at the availabilities on the Toren website and the one bedrooms and studios are offered at a lower price and they are located on a higher/or the similar floor. The appliances on the lottery pick are of lower qualities than the market value units and there is no restriction in selling the unit. The price per square feet for my unit is $699 and the price on the 15th floor is $665. Please give me an explanation of why the unit on the 15th floor is offered at the lower than the lottery unit.
Posted by: torenhpdscam at September 17, 2008 7:31 PM
After several research and analysis the Toren lottery pick is not worth the price for one bedroom or studio. I look at the availabilities on the Toren website and the one bedrooms and studios are offered at a lower price and they are located on a higher/or the similar floor. The appliances on the lottery pick are of lower qualities than the market value units and there is no restriction in selling the unit. The price per square feet for my unit is $699 and the price on the 15th floor is $665. Please give me an explanation of why the unit on the 15th floor is offered at the lower than the lottery unit.
Posted by: torenhpdscam at September 17, 2008 7:31 PM
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