Great expectations

The asking is 1.1M. I wouldn't be surprised if it went for 950k.

You are assuming the buyer is a first time buyer, and needs a large mortgage, and -hence- will not be approved.

Given your assumption, I concur with 800k.

However, if the person bought their first place in -say- 1996, and are now selling it to buy this one, they will have a lot of cash. Hence, they will not need as large of a mortgage and could pay more.

For the sellers sake, I hope there are lots of people like I describe.

True. But people did pay incredible amounts of $ to live in The Prosepect on Classon

I was amazed....

Hopefully this seller will figure out where The Prospect buyers came from...

Ah, but you have to factor in the Brownstone Factor.

People love having a thick, brick wall between themselves and their neighbors. They love being able to say, "I didn't buy a condo, I bought a Brownstone. It has a back yard where the kids can play, I can garden, and we can BBQ".

eastbloc said:

Note the "two kitchens" -- this is a potential (illegal) two-fam masquerading as a single-fam.

Where's the second kitchen?

Arches-

I just got back from the open house. Both kitchens are in the same room, the second kitchen is located on the central island. Kosher ready.

The developer planned to live there, but is now selling it once it is complete. S/he converted it from a two family to a one family; it would take lots of work to make this a legal two family again.

The more I think about this home, the more I think I would spend my fictional 1.1M elsewhere. There are a lot of row houses in PLG that are about the same price.

Granted, they are further from a commercial strip, but they are on intact blocks of owner occupied row houses.

Those big buildings can be good deals or nightmares. Too risky for my blood

Cool The Kid said:

Those big buildings can be good deals or nightmares. Too risky for my blood

Yes, you would definately want to see if the plumbing, heating and electrical have been updated.

Given that about 1/3 of the building is still not market rate, I doubt those upgrades have been made.

Vapor-

I would like to see if the numbers could justify making the market units into condos, and keeping the rent stabilized units as sponsor units.

Thanks AP!

BTW, the available air rights on this building seem to indicate that an additional floor could be put on the building. One could create four nice glassed penthouses, with views of the parkway and perhaps NYC.

Some of the buildings along EP, west of Washington have already done this.

Eastbloc - you don't cap gross revenue. It's got to be net revenue. Taxes are $42k, maintenance, common utilities, salary, magagement fee has to be at least another $150k. That's NOI of say, $587k. That's a 4.6% cap. There's something else going on here.

A bunch of homes sold recently in our area:

http://bktothefullest.blogspot.com/2013/01/diary-of-wimpy-bid-610-eastern-parkway.html#comment-form

While many people focus on the folks who are buying, there are an equal number of people selling......

vaportrail said:

Eastbloc - you don't cap gross revenue. It's got to be net revenue. Taxes are $42k, maintenance, common utilities, salary, magagement fee has to be at least another $150k. That's NOI of say, $587k. That's a 4.6% cap. There's something else going on here.

The 285 - 291 EP site is still on the market:

Here is the realtor's pitch:

I wanted to give you an update on the 33 unit multifamily building we’re marketing at 285-291 Eastern Parkway in Brooklyn.

The fully occupied building consists of 33 apartments with the ability to add one basement unit (with a letter of no objection) as well as air-rights to add over 19,000 SF. Some of the 2 bedroom units can be converted into 3 bedrooms as they become vacant. With only 7 rent-stabilized units and 25 free-market units, there’s an opportunity for future condo conversion or the possibility for the addition of a roof deck.

The property has a projected annual gross revenue is $912K and the Projected NOI is $752K, which represents a pro-forma cap-rate of just shy of 6%.

The Eastern Parkway corridor continues to see growth and new development. Some new construction condominium projects within blocks of 285-291 Eastern Parkway include the Park Union and Richard Meier on Prospect Park buildings where condos are selling above $1,000/SF. Brooklyn residential rent growth over the last 3 years was approx. 10% year over year, out-performing Manhattan.