House of the Day: 241 Carroll Street
Unlike some of the other absurdly-priced houses in Carroll Gardens to hit the market this year, this one at 241 Carroll Street actually has a fair bit of grandeur and charm to back it up. Is it still overpriced? We think so, but check out those plaster crown moldings! If this we’re already configured as…
Unlike some of the other absurdly-priced houses in Carroll Gardens to hit the market this year, this one at 241 Carroll Street actually has a fair bit of grandeur and charm to back it up. Is it still overpriced? We think so, but check out those plaster crown moldings! If this we’re already configured as a two-family with updated kitchens and baths in the right places, we could see someone bite at, or close to, the asking price of $3,500,000, but this is a four-family house and the economics just don’t add up. If you put 20% down to buy this place planning to live in the duplex and rent out three floor-through apartments, your monthly mortgage payments alone are going to be close to $20,000. If you’re lucky, you’ll make back $10,000 of that on the three rentals, so you’re left paying $10,000 a month (plus taxes, maintenance, etc.) for a duplex in Carroll Gardens? Seems like a stretch to us.
241 Carroll Street [Douglas Elliman] GMAP P*Shark
Who on earth would lend money to any municipality for 30 years when they are all going to go the same way as the government…Bankrupt! At least the government can print its own money. Just take a look around at the towns starting to file bankruptcy. Vallejo,Ca. and many more will be down the pipeline with underfunded pension and health liabilities ahead.
sdrubbins, as crazy as it seems, you really can’t get a 2500 square foot duplex for 800K in CG anymore. Really, people are asking more than that for one floor apartments these days, especially in extra wide buildings. The duplex as a condo probably goes for at least 1.5. I know, I think that’s outrageous, too, but they’ve been condo-ing these buildings in the neighborhood and I’m pretty sure the one in the building next to this one went for even more than that quite a few years ago. I never thought they’d get that price, but they did.
And, the rentals on floor 3 and 4 are probably $2,500/month rentals because they are 1250 square ft. I also agree that’s outrageous, but it’s difficult to find a 900 square ft floor through in prime CG for under $2,000 these days. The top floor is less, but could probably still get at least $1,800.
Not that these numbers make it worth much more than the 2.5 you calculated, however. But I think if it were listed at 2.5, they’d likely get an offer fairly quickly (and if it’s a good price, even a bidding war). But asking $1 million on top of that does seem ridiculous.
Okay didn’t realize it’s five storied… because there are no windows on the front of the 5th floor (how lovely).
So the rentals are worth what, $6,000/month? $6,500? And the duplex is the equivalent of maybe a $800k condo, so call that about $5,500/month.
$12,000/month in mortgage payments means about a $1.8M loan. Take a nice round, chunky down payment, say half a million, and I’d peg the value at $2.3M. (That’s not even taking into account taxes or maintenance costs…)
Of course you’re investing in a house, you’re paying into equity, blah blah – I own myself, I know all the rhetoric and rationales. Just saying, even being generous I don’t see this being worth more than $2.5M.
I think the point is that nobody is going to pay a much higher rent.
5:44
Very good point. Was out in Maui recently, and all I can think to myself was if I somehow scraped together a few million – I’d move there in a heartbeat and live off the interest.
$1MM will get you a large beach front house – maybe not an East Hampton estate, but mighty comfortable.
Surf all day, grill fish and pork island style, and just kick it.
Why do we live here?
11:41
A capitalization rate is a financial metric, commonly used to analyze residential real estate.
http://en.wikipedia.org/wiki/Capitalization_Rate
That said, you got it backwards. Low cap rates are associated with rent regulated buildings because of the upside. Market rate rents typically have higher cap rates as there isn’t as much upside. A huge percentage – perhaps the majority in Manhattan – of rent stabilized tenants break the rules and you can get them evicted. There is a whole business in evicting rent stabilized tenants who take advantage of the system.
Anyway, I pulled 5% out of my ass. Honestly, a more accurate rate would be from 6% to 7%. My point was even at an aggressive rate – the price seemed unrealistic. By comparison, in recent years, rent stabilized properties have been known to sell at rates below even 3%.
Polemicisit says “5% cap rate means $175,000 net operating income per year, or about $3,800 per month.”
dont cap rates only apply to rent regulated properties?
This property is not rent regulated and therefore can have a much higher rent role. Or am i missing something?
True, I’m not a fan of that block either, although it’s a nice school (my kids go there) and I’ve walked down that block in the evening and it is pretty quiet. On the other hand, if you like being close to the park, and think the one-minute walk to school with your kids is convenient, you might not mind. Although I definitely wouldn’t pay a premium to live on that block, unlike some of the more beautiful place blocks in the neighborhood.
Besides the fact that the asking price is unreasonable, I doubt that this is a “quiet street” as the listing says. Across the street from a park, next to a school, and half-a-block off Smith. Close to the train, which is good, but not the most charming block.
sdrubbins, I don’t think many posters are saying this is a realistic price (except some broker postings).
However, are you sure that the PS 4th St. house was same size? I don’t think you can get a 25 ft wide x 5 floors 2 family house with details going for 2.5 million (and people thinking that was expensive) unless it was in horrible, horrible shape. That’s alot of house in Park Slope for that money.
This house has been on the market quite a while — all through the spring buying season. So I don’t think anyone is making any offers close to the 3.5 million asking price. That’s a much better indicator of whether this is a good price. However, I could see this going for over 2 million, but not close to 3 by any shakes.