OPEN HOUSE: Saturday, July 3rd, 12:00 Noon-1:30 PM. The old saying back around 2005 was that "you can't get a shell in Harlem for under 1 million" and it's interesting to see how that compares to today's market. Number 152 West 132nd Street (between Lenox and ACP/7th) is a good example of a typical shell in Central Harlem that's on a block that still needs a bit of work. The brownstone is slightly less than 15 foot wide and has a totally destroyed interior that's not habitable. This property was on the market back in April 2009 for $795K and now has been reduced to $595K. The townhouse is actually the second one in from the right-hand building (of photo) and that neighboring property is also a shell. Currently at 2,800 square foot of space, the building comes with plans to add a couple more thousand to the layout for those thus inclined. For folks back in 2005 who wished they could have bought in early 2000, this might be the chance to get into the market. Thoughts? The closest train to this location is the 2,3 at 135th Street and Lenox. Photo by Ulysses
Its still overpriced. It'll move for less than $300K.
ReplyDeleteBaseball had its "steroid era" pumping up the numbers, and real estate had it's mortgage shenanigans era (2005 was prime time) where all the numbers were pumped up thanks to loose lending to all with a pulse, and qualifying people for 150%+ of what they truly qualified for. At the end of the day demand was "engineered or fueled", hence the $1M shell 5 years ago.
ReplyDeleteIt never was worth $1M, just the result of priming the pump, and this above is not worth $600K. Not even close, heck, they can't sell this Hamilton Place townhouse at $750K
http://www.prudentialelliman.com/listings.ASpx?ListingID=1114849&utm_source=NateFind&utm_campaign=corporate&utm_medium=listings
If some one had the cash to renovate this wouldnt be a bad deal. it costs between 150 and 200k per floor for a gut reno.
ReplyDeleteThe home your comparing this to at 52 hamilton place has something seedy about it. The place was on the market a year ago when I bought my house. They have a bunch of fake Craigs List adds and it is was never able to be shown.
So, some simple maths:
ReplyDelete$200k per floor gut reno = $800,000
Shell price = $595,000
Total: $1,395,000
So, that works out to be around $500 sq. ft. Seems fair enough to me, no?
Anon @ 4:04pm, you sound like one of the lot who wants desperately to get in on the Harlem scene for pennies. I think at this stage of the game it isn't going to happen. Although, I do agree that the $1m shell fiasco of 5 years ago was, indeed, a fiasco.
End of the day, I think $595,000 is in the ball park for what is a nice enough location.
7.03, Did you see the employment figures released today? We are in a recession, there is no horizon and nothing to suggest price points are ascending. Ever read the NYT?
ReplyDeleteJune 30, NYT - "Jonathan J. Miller, the president of the appraisal firm Miller Samuel and the author of Elliman’s report, said prices would most likely be flat for the rest of the year. “We’ve reached the point where a lot of the damage has been done, but we’re not yet at recovery,” he said. Factors inhibiting recovery, he added, include continued difficulty getting jumbo mortgages, high unemployment, rising foreclosures and a “shadow” inventory of new development units that have yet to come to market.
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Keep in mind, he's speaking to Manhattan, and it's in trouble. The "FACTORS" inhibiting recovery? They are WORSENING going forward short and long. And Jonathan Miller is a Cheerleader for the Real Estate industry in NYC. He's doing the best job he can in putting lipstick on a pig.
Bottom line? Harlem is the first to fall, and last to rise when it comes to Manhattan RE. Prices across the board in Harlem are going down. It's not a death spiral, they're just going down. The property asking $695K today will take 10% PLUS less by Q4. Disagree? Make the case for the factors driving this...to change for the better. The President can't even do that.
11:33pm, not sure what you are talking about. We are no longer in a recession. Do you read the news?
ReplyDeleteYes, prices may remain flat for the rest of the year, but there has been a definite increase in the number of transactions. Instead of cherry picking quotes, why don't you read through the rest of the article?
http://www.nytimes.com/2010/07/01/nyregion/01quarterly.html
"Prices are basically flat, but we saw a big uptick in sales." - Pamela Liebman
"Increased sales volume was an indication that the real estate market was on the mend."
"This recession came back from the bottom up," said Dottie Herman, chief executive of Prudential Douglas Elliman. "Smaller apartments were first, because there’s always going to be a market for the entry-level apartment, but now the high end is selling too because people see an opportunity since prices are down."
Let me know if you need any more. I don't think anybody has a crystal ball, but statements like "Harlem is the first to fall, and last to rise" are nonsense. As far as I can tell, parts of Harlem have actually done fairly well over the past 6 months. The Livmor is over 50% sold, the Douglass is over 60% sold. Graceline Court on 116th & Lenox Ave recently hit the 80% sold mark.
Did you happen to read this article?
http://www.nypost.com/p/news/business/realestate/residential/better_off_fred_fHlUA89yCFqIk1UcfFIX5K
Also, what property are you referring to asking $695k? Or is that a random number you are just pulling out of thin air? Amazing.
$595 is OK for a shell if the market is truly on the mend and things are going to return to the mid 2000 levels. I don't think anyone has the magic 8 ball to see if the future of Manhattan is on the up or down at this point in time. Even the economists listed in this debate aren't the final say. The market is. However, I think everyone would agree that the mid 2000's were a true anomaly.
ReplyDeleteI'm not a betting man, but if I were, I'd bet that there are going to be one of two things happening locally (as well as nationally):
1. There will be a market correction to drive the prices down to pre-anomaly (or mid-anomaly) levels.
2. The market will remain flat until fundamentals catch up with the run up during the mid 2000s.
Its probable that some combination of the two will also occur. But lending standards have changed and many peoples credit was dinged during the last year or two. So you have two other fundamentals in financing to add to the mix:
a. Fewer eligible borrowers.
b. Less money being lent.
These two alone will apply some stagnation to the market, nationally as well as here and "lend" to a sellers market driving prices down further until those two situations change.
Ultimately, we've got to pay our dues for the hyperinflation period that we had during the mid 2000s... and that means either #1 or #2 listed above. Because of the government prop ups we've had recently, I'm not sure the numbers we are seeing now are actually representative of the market.
Now that Congress has stalled the unemployment benefits, the census workers temp jobs are over and the housing credit has expired...we are ready to see the REAL market numbers. Unfortunately, those won't be available for another few months.
So the price listed for this isn't really judge-able until then. And I'd bet a dollar to a donut, most folks with $595k or the ability to qualify for that much will (this is the last wrinkle in the market) hold off until later in the year to make a purchase.
Add it as (c) or #3 in the lists above, "most buyers are in a holding pattern until the dust settles". And right now, that's the only thing buyers, sellers, brokers and economists can truly bank on.
Lets assume things return to the 2003-2004 levels where a shell would net $595k. I live in a brownstone purchased in 1997 as a shell (within 2 blocks of this property) for $75k, and it's bigger than the one listed above. Over the 10 year period of 1997-2007 shells went from about $100k to $1 million. We're sitting on a big downward correction or a long time at flat prices, any way you spin it.
Chris said...
ReplyDelete11:33pm, not sure what you are talking about. We are no longer in a recession.
_
...and Iraq was not & is not about oil, OJ is innocent, and Columbus discovered America. Gotcha!
anon @12:49pm, I think you are about right. Will be interesting to see where we are in six months from now. I agree that things will probably remain flat for the foreseeable future. I do think that there are deals to be had out there, but you may have to dig a little deeper and move quickly.
ReplyDeleteanon @10:32pm, Happy 4th of July (and I'm a Brit ;).