Buying a Rent-Stabilized Bldg
My parents and I were looking at a 6 family building with 4 rent stabilized tenants, 1 vacant, and the owners apartment. My parents would take the owners place and I would take 2 of the other apts to combine for my own growing family. Pleeeeease don’t go all rent-stabilized crazy on me, but would…
My parents and I were looking at a 6 family building with 4 rent stabilized tenants, 1 vacant, and the owners apartment. My parents would take the owners place and I would take 2 of the other apts to combine for my own growing family. Pleeeeease don’t go all rent-stabilized crazy on me, but would I be able to take one of the rent stabilized places over to do this? If so, can I pick any of the stabilized units? I suppose I would pick the one paying the least since the higher income from the others is what is making my mortgage manageable. Does it matter which one I decide to ask to move out? Any thoughts on the matter are appreciated. I’m really not looking to be some evil landlord- just want a place for my family and parents to live with a bit of income.
Well I have to say I’ve been in my apartment for 37 years and 100k would not move me out.
As far as bkhabitant I’ve got a question for you. When no one was willing to either live or rent in your neighborhood. My landlord made me an offer on an apartment and when I took his offer I kept him afloat otherwise the building would have reverted back to the city for non payment of taxes and been abondoned.
My home (apartment) is my castle.
I have no idea why you bought property that you think squaters are on with no recourse.
In my last post, I meant there are no “low income requirements” to qualify for rent regulated housing, so all arguments that the laws are necessary to help low income folks stay in NYC are bogus.
The politicians will never add a low income requirement since so many beneficiaries of rent regulated housing are wealthy and those individuals vote en masse.
bkhabitant,
Since many rent regulated tenants pay rents that are below what it costs to properly operate and maintain a apartments buildings, I’d say those rent regulated tenants are squatters.
Landlords like me are supporting these freeloaders. These people are squatting on my property, protected by arcane laws meant to help widows during WWII.
From my experience owning and managing rental properties in NYC for over a decade, I’d estimate at minimum 25% of regulated tenants in Manhattan and Brooklyn have other homes and keep their rent regulated apartments as second homes or illegally sublet them for a profit. It’s almost impossible for a landlord to evict a regulated tenant for non-primary residence since all he or she has to do is continue to receive mail and voting registration at said address.
The current rent laws drastically reduce supply of rental housing in NYC by allowing cheaters to game the system while everyone else has to pay sky high rents. There are no rules to keeping a regulated apartment in NYC. The $175k/yr law only applies to apartments that rent for OVER $2000/mo while most rent stabilized apartments are below $1000/mo.
According to NY law, a billionaire could have rent regulated apartment as long as his registered rent is LESS than $2000/mo. Talk about absurd.
Don’t do it unless you have a lawyer in the family and a ton of time and money to burn…
Rent stabilization, OK…rent control, not so much. Just recently, the son of a couple who lives (with his parents in their rent controlled apartment) owned by an elderly friend tried to pay a portion of their $440 UWS rent with his own personal check. Hmmm….If the owner accepted it, that would establish the son as a tenant on record. Under WHAT rational is $440 a reasonable rent price???
No reason this couldn’t be a win-win situation, especially with falling rents.
If a RS tenant is close to the market rate, then a cash offer might be a welcome windfall to them.
We used to live in an RS apt. on the UWS, paying 1700 when market was 2000 (what other units in our building were renting for). So we would have happily taken $15-20k to move on (or maybe less).
You have nothing to lose by asking, despite what other people say on this board. In our current building, there is an elderly R/C couple on the 5th floor (walkup). For them, 50k might get them a place with an elevator in a different neighborhood.
Its simple – if the Tenants fight you, it will cost you a fortune in time and money – if they dont then Owner12s experience is possible. And as was also said – there is a big push to readjust RS laws, so if no matter what – you could buy and have the all the laws and projections for which you based your investment be immediately and irrevocably changed.
I purchased a six family in Bushwick in 1992. Again many people told me not to do it but I took a chance because the low sale price took the low rent roll into consideration. I needed a place to live and so I took over the previous owners apartment. I knew that before I had children that I would move out so I had no intention on ever occupying any other unit. At that time the city paid landlords as much as 10K to take families from the shelter system so as people moved out, it was more profitable for me to continue to rent the units because Section 8 paid the rent on time. I have had one or two minor problems with tenants over the years which I didn’t take personal and considered part of doing business but I don’t have any real horror stories. Needless to say that this has also been a profitable venture for me.
There are various agencies both private and city that new landlords can go to to take basic “landlord” courses. anyone considering purchasing a multi-family building should definitely take at least one of these courses. As Owner12 stated RSA has good information and so does Neighborhood Housing Services and HPD. There have been revisions in the housing court procedures through the years to prevent people from making false complaints against landlords in order not to pay rent. Now while complaints are filed, tenants must still pay rent but to the housing court until their case is settled.
The bottom line is that if you truly plan on occupying units in your building and you get the respresentation to help you prove your case, ultimately you will probably get your wish. It will take time and money though. Most important although technically the law is on your side, how would you feel about evicting someone to occupy the space? Would you be comfortable living in the building with the tenants who may have formed friendships with the family/person that you evict?
Get some legal advice. There are several firms in New York that specialize in these issues. (I manage some rent stabilized apts). I do not want to recommend any but you can find out pretty easily on the internet. Spending a few bucks on legal consultation may help you make the right decision..