HOTD: 306 Washington Avenue, Two Price Cuts Later
The price of 306 Washington Avenue in Clinton Hill has been in free-fall since we featured it as a House of the Day when it came on the market last summer at $2,300,000. It looks like it was a bit of an understatement when when we said that the “asking price might be a bit…
The price of 306 Washington Avenue in Clinton Hill has been in free-fall since we featured it as a House of the Day when it came on the market last summer at $2,300,000. It looks like it was a bit of an understatement when when we said that the “asking price might be a bit on the high side.” In September, the price was trimmed to $2,100,000 and then another $200,000 was taken off last month to bring the current asking price to $1,900,000. The house was also included on this past weekend’s multi-broker house tour. Think it has a shot at this price?
306 Washington Avenue [Douglas Elliman] GMAP P*Shark
House of the Day: 306 Washington Avenue [Brownstoner]
I just read 99luftballons post and have to reply.
It’s very uncommon over three years to only once have to fix anything in a tenant’s apartment. Stuff usually comes up constantly — noise issues, garbage issues, leaks, smell complaints, you name it.
Sure you might get lucky like 99luftballons did, but she’s the exception not the rule.
One thing you could do is buy a tenement building nearby and move the rent stabilized tenants into your tenement building once you buy the townhouse. Of course you have to give them similarly sized, equally priced, rent stabilized apartments. Although if the tenant refuses to move, you would have to take them to court to force them to move.
I’ve never done this personally, but I’ve considered it. You might be able to pay a landlord in the area to “take on” the rent stabilized tenants; Doubtful, perhaps, but you never know.
Personally I would never want to live in the same building with my tenants. Separation between work and home is too damn important.
I bought a house with a rent stabilized tenant over three years ago and while they pay negligible rent that barely covers the outlays I got a discount on the house of some $400,000 because of them. We have almost 5000 sq ft of livable and habitable space but only 4200 in ‘habitable space’. In three years the only extra cost we’ve had (over and above utilities etc) is a broken apartment door lock. The tenant is a mother (90+) and daughter (50+) and their family have lived in (and once owned) the house since the early 1900’s.
While we could try and evict them 1) we wouldn’t because to me it’s bad karma (remember we got that discount going in) and b) as someone above pointed out as one tenant is over 62 there’s no point trying. But in the three years we’ve rented I would say that the market rent tenant has required more landlord work than the rent stabilized one.
If you’re are in your property for the long hall then it is worth not discounting properties with rent stabilized tenants. As long as you do due diligence it isn’t necessarily a bad decision and given that they scare most people away deals can be done.
We live in 3300+ sq ft and rent out two apartments of 880 + each and got in cheaply.
To me the biggest challenge with this property is four families are getting harder and harder to finance but it is worth doing the numbers to see if can work.
It positively warms the cockles of my heart to hear you all rattle on about throwing people out of the homes they’ve lived in for (probably) decades.
You don’t have to guess about the property tax. Just look it up on property shark. It is $7136 this year and will be $7858 next year.
Aussie – you’re just wrong on the interest rate number for a Jumbo in this day and age. AAA CMBS new issuance at trading at 850 over LIBOR currently. If you originated a jumbo loan at 7% today, it would be worth 85 cents out the door. If you can even get one with 25% down, it would cost close to 10% (remember, you can’t sell these loans into Fannie or Freddie, as they’re too big, so they just have to sit on a bank’s balance sheet).
Not arguing you should/shouldn’t do the calc – just stating that you’re using the wrong numbers. This price is just too high for this market with those rent stab. tenants in there.
sam et al: “A rent stabilized tenant can easily ruin your life and wreck your health” “get rid of tenants” “crazy to buy…”.
Look guys, we know: You think rent-stab tenants are vermin to be exterminated. OK. You’d never buy a place like this. Please don’t. You would not be a decent landlord anyway.
But there are others who can view it as a business proposition (tho’ not at that price) and maybe even treat their tenants well.
REPLY TO SLIM
Aussie – I think you’re vastly underestimating the costs.
1. A $1.4MM jumbo commercial mortgage (4 family and up) is going to cost a LOT more than 6.5% in this environment. I’ve seen jumbos priced at closer to 10% these days. WITH A 25% DEPOSIT? … THAT ISN’T TRUE YOU COULD CONVINCE ME OF 7%.
2. $2,000 for taxes is quite low. The norm is closer to $4,000/5,000 (I pay almost $7,000). OK IF YOU SAY SO ITS FACTUAL SO WE COULD JUST ASK.
3. Need to add insurance costs, which are now pushing $4,000 per year. YEP YOU ARE CORRECT I PAY $2500 BUT I GUESS THAT WILL GO UP. WONT CHANGE THE PICTURE MUCH.
4. Also need to add a pretty big “miscellaneous” bill, especially with rent-stab. tenants. HOW MUCH? MY TENNANTS REALLY ONLY COST ME SOMETHING WHEN THEY MOVE OUT. MY HOUSE IS IN GOOD CONDITION BUT THIS ONE ALSO LOOKS GOOD.
5. And the big tax savings – well, the dreaded AMT gets rid of all of those. YES i AGREE IT DOES FOR MANY PEOPLE.
MY POINT THOUGH IS THAT THE CALCULATION NEEDS TO BE DONE.
slim, AMT doesn’t kill mortgage deduction. . . agree with the rest