Buying a mess of a house

I’m looking to buy a home in Bed stuy that has some paperwork problems. I’m trying to gauge if it’s worth it financially and time wise.

It was purchased by its current owners in 2011 as a one family according to ACRIS info. Had one family living in it at the time, using it as a one family house. However it had SRO restricted status still according to DOB and HPD. The previous owners delivered a certificate of non harassment at time of sale so current owners were able to get their permits and after purchase, they started legally converting the house to a two family.

Cut to 2019 and the house has been gutted and renovated and acts as a two family with duplex on bottom and one level apt on top floor. However something happened and all the permits expired and were never closed out. The new certificate of occupancy for a two family was never obtained as permits expired and the house was never signed off on by the city. And more importantly, the house still has an SRO restricted status as I believe the Certificate of non harassment must have expired after three years. Cur rent owners have since moved to Europe for work and have renters in the two units paying high rents.

There are a lot of concerns here but my main questions are:

– are the current renters technically living in an SRO? If they find out about the houses status can they decide to never leave?? At the same time they are living in a house with no Cof O which is illegal regardless.

-will I be able to finance this mess? I should also mention that a quick search brings up
A lien on the house and open HPD violations.

-will I need a new certificate if harassment (even if the old
One from 2011 still exists somewhere) and if so, does it include the current tenants AND the old tenants?

-would the city still have to close out the existing permits and check everything for safety and code? Or would I be able to start fresh with my own permits?

I know it sounds messy but the house is a good deal because of it. But I don’t want it to take 5-10 years to just get the paperwork cleared. The sellers broker hasn’t mentioned a lick of this, by the way. They are only saying it’s a two-family house but clearly the price is lower so I’m not sure why they aren’t being more up front.
Thanks,
Richard

Guest User | 5 years and 11 months ago

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stevecym | 5 years and 11 months ago

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slopefarm: the bar is being lowered all the time.

slopefarm | 5 years and 11 months ago

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“Also I’m shocked that a high end real estate company would put this house on the market and hide these details?!?!”

I’m not shocked at all. Brooklyn realtors take caveat emptor very seriously in my experience and run with it as far as they can. Do not expect any more candor than they are grudgingly required to provide. It’s a dirty business. Forewarned is forearmed.

Guest User | 5 years and 11 months ago

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Leave this one to the pros. It will dominate your life for the next three years and you will be writing more or less blank checks to architects, code consultants and lawyers throughout.

cate | 5 years and 11 months ago

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Walk away. This house is everything you don’t want. (Is it a limestone on Stuyvesant? I know of one that fits your description whose owner got into an illegal SRO conversion and has never been able to resolve it.)

resident2 | 5 years and 11 months ago

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CONH do expire. To cover exactly this situation. The current landlord has re rented the building (illegally) so now someone wants to legalize it, refill, get a permit etc. HPD & DOB want to know that no tenants have been harassed out of their home….
The CONH search goes back to the prior three years. So if building permits & work progression have not been renewed etc during the time from the issue of the CONH the paperwork all falls apart. Back to square one.

NeoGrec | 5 years and 11 months ago

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People buy SROs, do everything by the book, and succeed in changing the CofO. Other posters on this forum will tell you that it is a long, slow process that requires patience, a knowledge of NYC code, a DOB expediter, a good lawyer and — after all your hard work — that all important Certificate of Non Harassment. I am no expert on this subject but I’ve never heard of that certificate expiring. Maybe the absentee owners never completed the process. If they did, why wouldn’t they be able to produce it? This isn’t something you lose. Anyway, if DOB and HPD say it’s still an SRO, then that’s your answer. Talk to a mortgage broker like Adam Dahill and find a great lawyer and expediter who have done this before. Otherwise, it’s not worth the small discount. Brownstone prices keep falling — you can get a deal without getting a lemon!

Guest User | 5 years and 11 months ago

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Thanks. I have purchased brownstones before so I do have some knowledge, this one just seems above and beyond difficult. I certainly feel bad for the sellers as they are in for a massive loss and will probably have to walk away with not that much cash deal.

resident2 | 5 years and 11 months ago

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In this day & age there are very few Good Real Estate Brokers that know about Real Estate. They are all sales agents and the least they know about Real Estate the easier it is to make sales it seams. … but enough about idiot Brokers. Any decent Broker would disclose the situation with a building like this right up front in the marketing, simply because they do not want to waste their time banging their head against a brick wall when lawyers, Mortgage Bankers, Architects, Title companies etc come into the picture
The bottom line with a building in this situation: It is an SRO, treat it like any other wreck of an SRO and realize that you have to start from the beginning again.
Do not buy it if it is not delivered vacant.
And get the sellers to deliver a new Certificate of Non Harassment.
Bare in mind most Banks do not finance SRO’s., How are you planning on buying it?
You then have to file plans etc and do the work all over again. Because no plumber, electrician etc is going to sign off others work that is quite possibly out of date by today’s codes already!

Never ask why the sellers did or did not do this or that…. although in this case they probably just ran out of steam… the job took much longer & cost much more than they were expecting… the building got to a livable stage, they moved in , got back to their full time life and time carried on….. they were tired of it!

You just have to deal with what it is. If you are not experienced with SRO’s, do not buy it. If all you want is a great house at an affordable price… do NOT buy an SRO. Do not make the mistake of thinking buying a fixer upper is easy. It is Not especially if you have a full time life!

greenworks | 5 years and 11 months ago

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Welcome to real estate. I’m fairly familiar with buying selling and would avoid this headache even with that experience (maybe bc of it?).

It sounds like you’re very new to this, so unless you have ooooooodles of ca$h money, a FABULOUS team of consultants, and time to burn, AVOID.

Plus everything that Augustiner said.

Guest User | 5 years and 11 months ago

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Also I’m shocked that a high end real estate company would put this house on the market and hide these details?!?!

Guest User | 5 years and 11 months ago

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Thanks for your insight. Right now I’m nervous to go digging as I don’t want to alert dob/HPD to any of these issues yet.

I’m in HPD there is a mention of a CONH from the year the house sold. But don’t have details. I did place an anonymous call to HPD and I’m general terms the woman told me that after three years they all expire if a COI has not been received. Which seems horrible because I can’t believe the sellers would let that happen and risk the value of their home.

Does anyone know if I’m going to have an issue getting the current tenants out since it’s SRO restricted? I’m also nervous about them trying to stop paying rent since it’s an illegal space technically with no COI.

Augustiner | 5 years and 11 months ago

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The old saying goes: “you get what you pay for”
My experience is that there is no such thing as an incredibly good deal. Especially with a problematic house like this. Assume the worst:
– They probably had a reason to not close the permits, maybe the work was not done according to plans,.
– Maybe there never was a Certificate of Non harassment issued.
I am about 80% certain that you don’t need a certificate of non harassment in place to pull alt1 permits. It is only required when you want your C of O issued.

I think you need to
– call the HPD to find out if the Cerificate of Non Harassment was issued, if it is still valid, or what the process is to renew it. Don’t tell them that anyone was or is living in the house or you are in deep sh**
– pay an expediter to find out if the current permits can be closed out

This is not for the faint of heart. Only do it if you have spare cash to gamble with, and do your homework.
Also consider you’ll be paying upward of $20.000 in property taxes for a converted SRO about 2 years after you receive the C of O.