eastbloc's Profile
Author's Posts
September 9, 2009
Rental Comps for a 203k?
We're doing a 203k in Crown Heights North, and are having trouble finding reasonable rental comps. It seems there's not a lot of reported listings for rented units, and the ones used by the appraiser put us underwater for the 203k.
The property is at Sterling and Franklin, each unit is a 1000 square foot 3 bedroom, and the ground floor has a large private garden.
The appraiser put us down for $1650 per unit. We'd like to be someplace north of $1800 per unit, but are having trouble finding comps to counter the appraisal.
Our broker has turned out to be not terribly useful in this case. Anyone have any suggestions?
Author's Comments
How/where does one obtain a fire report?
We recently purchased a 3-family townhouse in Crown Heights. During renovation work, the electrician took down part of the ceiling in the basement to reveal the aftermath of what looked like a serious fire.
Fortunately, the damage was repaired (sistered joists) but we're still curious when the fire happened and any other details about it.
Posted by: eastbloc at November 13, 2009 10:03 AM in response to Fire damage to roof
eastbloc wrote a review about Szechuan Delight on October 16, 2009 3:04 PM
Is this an actual Sichuan place, with Sichuan dishes? Dan Dan noodle? Twice cooked pork? Or are they Sichuan the way Frank's Trattoria is Italian?
What if you already know you're getting a pretty good deal, and so does the seller, but the appraiser used some clearly inappropriate comps?
Posted by: eastbloc at September 28, 2009 10:44 PM in response to Appraising the Appraisers
It was similar for us. RELS was only the agent providing the 'Chinese wall' between Wells Fargo and the appraiser. The appraiser they selected was Clark Katz out of Nanuet, and they were evidently clueless with regard to the Brooklyn real estate market.
In their opinion, use of a 1600' outdoor space and a 1000' unfinished basement did not warrant any additional rent over the other units in the building!
I have a suspicion that RELS charges a standard fee for the appraisal and pockets the difference from what it actually costs. This creates incentive for fast, sloppy work in order to be able to undercut bids from more respectable appraisers.
Posted by: eastbloc at September 28, 2009 4:24 PM in response to Appraising the Appraisers
This happened to us just a month ago. The appraiser was from out of town, and used only Property Shark to source his comps.
One was wildly off, bringing down the appraisal by more than $100k. Some research showed this property was a short sale, which shouldn't have been used. The appraiser also got the layout wrong, missing a room on each floor, and while he agreed to update the layout, he refused to adjust the rental comps (3 bedrooms versus 1/2 bedrooms he used on comps).
As a result, we had to adjust our loan from a 30-year to an ARM to reduce the payments in order to qualify. When the loan was finally submitted, the underwriter ordered a second appraisal anyway; this one was done more professionally and came in $100k higher, but too late for us to adjust the loan parameters.
It could have been worse, but it was an unpleasant experience that considerably delayed our closing.
BTW, the company that 'performed' our first 'appraisal' was RELS.
Posted by: eastbloc at September 28, 2009 2:06 PM in response to Appraising the Appraisers
I don't really care if I get that much for the units -- I can afford to carry the mortgage (just barely). I'm actually hoping to rent the units to friends at very preferential prices.
My problem is that the bank needs to see higher comps to give us the loan.
The comps can be within a one-mile radius, so well into Prospect Heights, Fort Greene, and maybe even Park Slope, as long as the property is comparable (two or three family building, about 1000 square feet, etc).
It just seems that no one puts the rental data back into MLS once units are rented. The only listings we find are 'active' and 'expired'.
It's ridiculous that we can't qualify for the loan based on income. There's a chance we won't be able to buy this perfectly reasonable and reasonably-priced property in spite of excellent credit and income just because we can't get comps :(
Posted by: eastbloc at September 9, 2009 4:36 PM in response to Rental Comps for a 203k?
Responses to Author's Forum Comments
For a small search fee, I'm sure your attorney could obtain the fire report for you. Anyhow, we've decided to pull out of this house. The Seller's aren't showing willingness to investigate the fire damage and they're not being particularly cooperative. We don't need to be dealing with shady Sellers and to be honest, the house is nice but it's not that great. Thankyou to everyone for your replies, your help has been invaluable.
Posted by: cmcrossland at November 13, 2009 11:58 AM in response to Fire damage to roof
It's between Bedford and Franklin, not Rogers and Nostrand.
Posted by: eastbloc at November 16, 2009 1:24 PM in response to House of the Day: 685 St. Johns Place