Harlem Prices

Potential to get those prices on a townhouse. Though, when you net out the walls and other dead space, it actually gets quite a bit higher.

I noticed some of the new condos on FDB were trying to get ~$1,000 per square foot. Based on this pricing, I suspect there may still be a crack problem in Harlem. (no offense to anyone)

I could see prices coming down over the next 6-12 months, since that inventory is going to start to weigh on the developers.

I'd consider Harlem at $500 psf. You'd be a first rate sucker to pay anything above $650 psf in Harlem during these times. And I'm bullish on Harlem's future.

Pawn_Harvester..not funny

In defende of Pawn_Harvester:

Cheaply built condos often develop cracks in their walls.

It is economics, guys. 1,000 unsold condo units = pressure on prices. Who is going to pay $1,000 per sq foot in harlem. you can go to the upper east side or east midtown for $600 / sq foot. Harlem should trade at 40% off these areas. $350-400/sqft.

Bloomsday - give it a year. Just invest your money in something safe until then. Greek Gov't bonds or bank stocks, perhaps.

In mid-2008, I also suggested that by late 2010 prices in Harlem would be sub $400/sq ft as more of an over-correction than where things will settle. While I was correct about the directional aspect...it's far less than certain on the actual price levels. I still feel prices in Harlem need to correct further- but I am feeling far less confident. Perhaps it's just that the market can be irrational far longer than I can be patient?

Long term I am bullish on the future of Harlem- but short to mid-term I feel there is still tremendous pricing risks present.

I am with samerun - it has shocked me how well Harlem prices have held up. There is still lots of inventory so remains to be seen how well it moves. It's really hard to say though what prices are "irrational" - the reality is they are bargains compared to most places in Manhattan. Yes, the amenities are not there yet, but there are parks, subway access, light, etc. The listings at $1000 psf are not selling but the $600 psf mark seems to be finding some traction. The rate of improvement in amenities through the downturn has been shocking, with the opening of Best Yet, 5 & Diamond, Settepani as a dinner place, the soon to be beer garden, etc. My gut still says there is more downward mvement to be had - especially in the condo market given the oversupply - but I think long-term buyers will be fine.

116th reminds me of 14th street 25 yrs. ago. But not everyone thinks the 14th street of today is "better". If prices drop to $450 per sq foot, I will move forward. There really is no rush at this point, because prices (no matter what the agents say) will not go up in Harlem for a long while. Thank you Pawn_Harvester for your advice (you do have my fudiciary best interest in mind), but I was thinking of putting my money in Gulf shrimp an oyster futures...

What impact will the planned Hyatt Hotel on 125th & Lenox have on real estate if it actually happens. By the way, the WSJ indicated that renowned chef Marc Samuelsson will open The Red Rooster just down the block on Lenox Ave btwn 125th and 126th streets...might he have some insider info?

I think clearly a hotel (especially if it brings a Whole Foods) and nice restaurant will have a positive effect- the extent to which remains to be seen. Harlem prices are less than 1/2 of what they are in many parts of the city, and the biggest issues is amenities (followed by school situation and crime). But particularily in South Harlem, the school situation is improving quickly, and crime is pretty low anyway. So positive effect - but I don't think this will make prices spike. It's bit by bit. I think Harlem will continue to "improve" through the downturn, but not overnight.

I've also thought about the impact of the Columbia Expansion...$6.5 Billion investment can't hurt.

"$6.5 Billion investment can't hurt"

it will if it's priced in but not implemented

y'all should moves to hobo kens

Columbia is most certainly moving forward on their expansion plans. The question remains if they are able to implement their original plan due to the two hold-outs. Columbia has already demolished a structure on Broadway in the upper 120's...and they have built the church on Broadway and 147th that was going to be displaced as a result of the expansion. They bought the entire western stretch of Broadway between 147th and 148th They already put the church in- but they are also going to build a co-op on that block to residents in the expansion zone that were supposed to be able to buy an apartment from the city in that area. Right now only 2 businesses remain on that block- a 99 cent store and a Domino's Pizza. The Domino's is moving to Broadway and 149th Street- next to Tonnali's- which only leaves the 99 cent store. I imagine it's only a short while longer before they are able to raze the remainder of the block and begin construction on that replacement housing they promised. This will begin clearing the way for the new buildings in Manhattanville. In the meanwhile- they are continuing to fight on the eminent domain issue.

I think KSpeak's got it right. $1,000 psf won't sell in Harlem for many, many years. While the Kalahari and some other condos pretty much sold off all their inventory in the $600 range psf. That's where prices should start on any new development in Harlem if they want to sell them. If not, shoot the moon and hope we hit a serious economic boom in the next couple of years. For the right property, I'm ready to buy in the $500 range now. Otherwise I pass. But that's just me.

How about the income restricted condos/co-ops in Harlem that were built 5 yrs. ago and original owners were lottery winners. Now they are priced at double (or more) of the original price but the income restrictions are still in place.

For all the negatives about Graceline Court, at least is is 100% open market. I admit that I am probably just envious of the lottery winners and that "feeling" is aggravated by the possibilit of being a buyer reponsible for their profit.

It is interesting that when these lottery winners bought, they were all for this scheme, but now when they sell they "demand" market value after living there for 5 years.

I am a long-term bull on Harlem but think the Columbia expansion is not really a critical part of the story. The fact is Morningside Heights was pretty frightening until the late 1990s, and Columbia was there all along - there are countless other examples: West Philly around U Penn, Hyde Park around U Chicago, etc. Many of theese neighborhoods have turned around in recent years, but this is more due to overall urban reneweal than anything else. Also, the vast majority of development will be west of broadway in the low 130s - not exactly close to public transport, not to mention bordered by a large swath of projects immediately east. I don't think project per se dooms a neighborhood (plenty of places where there is nice housing stock near projects), but it's not like there is a lot of leftover real estate that can be converted to free-market housing. University affiliates will either need to live in the high 130s around broadway, stay in morngisde heights, or live in the cliched "SoHa." The high 130s near broadway though lacks many of the attributes that make Harlem attractive - subway access, brownstones, etc. My guess is many people affiliated with Columbia will stay where they currently are: morngisde heights, the Upper West Side, and, increasingly, South Harlem. That said, it certainly won't hurt, and will help on the margin.

I think the bigger harlem story is a combination of the critical mass that has been put there by the condo oversupply and the individuals buying up its brownstone stock, and generally the raw attributes of the neighborhood: housing stock, parks, access to transport, and a certain brand name (which is as negative as positive right now in connotation - but at least it has character). Any development along 125th street will help dramatically - especially if this Hyatt/Whole Foods has any real legs. Amenities are improving every day, and will probably continue to improve even through a downturn (baring the next Great Depression) as those condos get filled at lower prices or with renters.

kspeak, you're right about most of what you say, especially the neighborhood impact of universities not necessarily being the shot of gold that some people think it is. And in your characterization of Bway/high 30s ... but it does have easy subway access. No express, though.

What time are all of you getting to the mixer tomorrow? It'll be nice to finally meet you.

yeah, that's my point - it's a local train only, which when you are up this far, means it's a long commute downtown. in other parts of harlem you are on express trains and in most cases within 2 avenues of more than one line. i went to grad school at columbia, and remember being mercy to the 1/9 line .. and now there is only 1 train, not two, on that line

"West Philly around U Penn, Hyde Park around U Chicago, etc. "

Do not walk at night near USC, either. Just adding to the list.

I do think a Whole Foods on 125th would be significant - it was huge for the Lower East Side, for example. Hard to tell if there is enough critical mass to make it work - I very cautiously think yes, with all of the development on Lenox, the brownstone blocks surrounding 125th, the ability to draw from all over Harlem. I don't think it's as unrealistic as, say, a caviar bar or luxury car dealership. Whole Foods caters to a pretty wide crowd, even my nanny and cleaning lady would go there when we lived near 14th street. Funny thing is, despite being mildly obsessed with cooking, I'm actually not even a huge Whole Foods fan myself (mostly because one has to trip over all of the people buying the ready made food to get to the actual groceries), but it does seem to bring other retail with it ....

I might agree kspeak. THe caviar bar and rolls dealership were ABSURD. But whole foods? Mayhap. You also have 6 bus lines that converge their - so its not super far fetched. But we will see, won't we....

The 9 train was a convenient fiction, so always one line. But in truth, when I lived near the 125th stop on the IND, the super-express trains during morning rush hour got to 59th from 125th not much faster than their local counterparts -- super-express, super-congested tracks. Less jostling at a million station-stops, though.

I believe Yale/New Haven can be added to that list as well. See http://streeteasy.com/nyc/talk/discussion/20524-wednesday-se-mixer-whos-in for evidence.

It looks to me like some buildings (notably 1485 Fifth Avenue) are selling at well over $600/square foot. Aret the prices Streeteasy reports inaccurate? If so, how is that permitted to happen?

LEF

Still selling at $600 psf? Or before 2008?

I think many of those 5th on the Park (1485 Fifth) were sold before the meltdown of the fall of 2008 and are just closing now. I'd be surprised if anyone is buying at those prices now. But there are suckers out there.

Thanks, KSpeak and BronxBoy. How does one get a sense of what units are currently going for? Can the developers hide the actual prices or is there a way to find reliable numbers?

I have seen developers offering to pick up 2 years maint and mortgage payments. Be very careful in your diligence. There are good values up there, but just be sure to do your homework. You should also get a broker who knows the area. There are a few guys (Horowitz, Stevens, etc.) who do most of the deals in Harlem - seek them out.

I agree - work with a broker who knows the area. They can probably tell you what is going on, what to avoid, etc. I think 5th on the Park is actually a nice building - granted not as closed to the development on FDB, but the surrounding area has more charm, and I think the actual building is nicer than the FDB condos.

... but one has to be careful in that building given what's been going on ...

5th on the Park has slightly better amenities than the other buildings, but the pricing is drastically out of whack. Also, there are very very few amenities nearby and it's not close to transportation. And Marcus Garvey Park can be very sketchy at times. It would be a good start to the area at $500 psf. But at the astronomical prices they are asking, forget it.

Sounds like 1280 5th is going to test the $1000/sqft mark. 9 blocks south of 1485 but right on the park. is there really that kind of a payup for this locale? they are trying to compare it with 1200 5th

http://therealdeal.com/newyork/articles/rounding-out-museum-mile

redonk

No train lines nearby. No markets. Right on the park, but besides that...sketchy. I would never pay close to that for such an area.

This won't get $1000 psf. That said, "no train lines" is not really true - it's 1-1.5 avenues over to either the 4/5/6 or the 2/3, and a few blocks north or south. That's no worse than living on say 2nd avenue and 72nd or 90th street on the UES - and nobody would say that there. Not to mention that you're on an express stop and have access to both the East Side and West Side. It's relatively normal in NYC to have to walk 5-10 minutes to the subway. Amenities are getting better and the Wild Olive grocery store will help, along with the stuff on Lenox. But $1000 psf is a pipe dream. I don't think 1280 Fifth will get that either ...

Depends on the walk, KSpeak.

got an answer to my own question. found out that 1280 5th mid level apts facing the park are ~1250/psqft. go do the math on that one.

Thanks brooks. Good luck to 1280 in getting that in this economy.

I visited 8th avenue in Harlem. It was full of poor people milling around. Not a place where I'd want to live. I don't want to be afraid to leave my apartment at night for the next ten years while I'm hoping for the neighborhood to gentrify.

Someone said 14th St wasn't so good 20 years ago, but there were never housing projects there and it was always close to the Village and centrally located. You can't say that about Harlem.

Twenty years ago many parts of the Village weren't "so good". A comedian friend joked the only he couldn't get rid of on 14th street was jobs (and he was talking about 6th Avenue, not Alphabet City) since there were so many other more interesting/lucrative pursuits for the crack heads and methadonians. If you think projects are a determent to gentrification perhaps you have heard of Chelsea, Lincoln Square or the West 90s?
I don't live in Harlem and it wouldn't be my first choice. But knowing in a decade or so that Harlem is strictly top shelf wouldn't surprise me anymore than telling me in 1975 that my neighborhood would be the most expensive zip code in the country (or was it the third most, anyway I wasn't talking about 10022).

I also wonder if people don't often confuse the presence of non-middle class (and yes in New York that means non-white, even if Barak and Michelle would welcome in everyone's home) people with a real crime threat. I have an idea Harlem in the '10s is MUCH safer than anywhere NYC 20 years ago.

Much of the new Condo inventory in Harlem seems Price-Geared to folks like bob_d, above!

That is, a nicely done 3 Bedroom Condo in 1500 or so square feet, seems to begin at a minimum of about 800K, and rise steeply from there. . . . .

HOWEVER, though bob_d is definitely NOT going to even consider moving to a Harlem Condo, . . . apparently, lots of the NON-POOR types, NOT milling about in the streets, feel comfortable enuff, to spend their hard earned dollars on some of these Harlem Condos!

At least, thats what The Brokers are saying, and some folks are indeed buying up the Harlem Condo/Coop Market Rate inventory, slowly but most certainly!

But there just seems to be so much TOTAL oversupply of these Pricey Harlem Condos!

Think Kalahari, Graceline, 5/Park, Livemore, Douglass, Ellington, St Klare, Lenox, ALL The Eastside Harlem Condos, now 2280 and 88 Morningside, just to mention a few, ALL with their roughly 600$+/square foot prices.
And, the Owner/Developers seem not to budge for months, years, in a few cases! How is this possible with Construct Loans to repay??

[I guess they figure if you can get one of the 3.5% DP FHA Loans, it must all be good, even in the hood . . . . if you can make those monthly Mortgage, Common Charge + TAX Payments!]
That seems like another FINANCE Bomb waiting to go off sometime in the future and send prices down if you ask me, but what do I know, not working in Finance and trying to just keep my head above water!

These Harlem Condo prices seem NOT too far beneath 'mainstream' Manhattan pricing . . . or to rephrase, the supposed Harlem 'discount' doesnt quite seem to be as discounted as I would think it should be!

Can anyone out there suggest a 3 BR Condo, or Coop, where an Educated, Civil Service Professional might be able to get in, in Harlem. Max of about 400K with not crazy RENAISSANCE Coop type monthly Maintenance Fee!

We're keeping our eyes open for my lil Sis, [well . . . . I'm doing most of it! . . . ] but absolutely nothing seems to be materializing that would work financially!

Its either Priced Out of The New Harlem Condos. . . and nothing at a real middle-working class pricing.
[She missed the Lotteries and nothing much else, if any, seems to be in the lottery pipeline for Harlem!]--please let me know if I am wrong!

The HDFCs are more affordable, and there are a few of those, but they come with their own special 'details!'

Its 275K for a true 1050 square feet of space with 4 BR and 1.5 Baths. Maintenance is 1K.
Not the greatest section of Harlem, in the 140's on Lenox, but Do-able . . . . BUT, now we find: 20% Vacant Units owned by Coop!?

No 3.5% FHA Loan!--Coop.
Conventional Banks and Lenders wont touch it.
Too much vacancy; Big Time Renovation Lien; some Maintenance Payment Backups!--UHAB and Not For Profit Lenders involvement!

just the same, an interested potential Shareholder, but need some Creative Financing leeway with Not For Profit
. . . at a rate that is comparable to what a Bank WOULD do . . . . . if Coop was Finance-Able in conventional manner!
The Units need to be sold if Lien is to be paid off, and Maintenance is to stabilize or reduce, and Coop is to move into future!

Management Company seems to be a waste of good Maintenance Money and Board seems STUCK!.

THE AFFORDABLE PRICE and Future Potential is what keeps my sis from a complete about face!
Would be good size for the family long-term! PRICE works, unlike many of the new, High Priced Harlem Condos and Coops!

Nothing else really at her Price-Ability and space need!
[2 youngsters!--Private Schooled, so not an issue; and they get dropped off and picked up!]

Anyone able to make any genuine suggestions within Harlem that might work?

It's a Catch 22, Lenox. The brokers/developers think the big money is coming here. They are wrong. It's still a long haul before Harlem apartments are worth much more than $500 psf in my opinion. The European market is gone...it helped five years ago. Lots of ghost projects will continue to loom over the projects of Harlem until developers and brokers come to their senses.

bob_d
about 2 hours ago
ignore this person
report abuse I visited 8th avenue in Harlem. It was full of poor people milling around.

You fucking retard scaredy cat. My pregant wife happily walked round FDB for 9 months from 110 to 125 at all hours. Some people are so pathetic. Grow some balls you jerk. I am white and I am not scared of black people like you.

Just how is it that Dafina, St Klare, WaCondos, and whichever other empty new Harlem Condos, SIT, FULLY CONSTRUCTED, EMPTY??

Are there no Construction Loans involved that demand Payback?? Doesnt theDeveloper NEED some type activity?

. . . not even converted to Rentals, or just plain discounted with a massive PRICE REDUCTION that would sell them instantly!! . . . .
. . . NOPE??!!--just sitting empty??

what gives??

Beacon Towers Cooperative is almost FULL-SOLD!! and occupancy underway!!
WHY?? cause: Moderately priced with 2 beds sold around 325-350K!!
. . . . Kool!!
. . . . Genuine Affordable for working class with savings and credit wise+worthy!!

. . . . THOUGH no 3+ beds for families!

Just who is affording these 700K 2 Beds brand new Condos??

doesnt making 200 GRAND/Year mean you can pick and choose downtown Manhattan?

WHAT ARE THESE NEW HARLEM CONDO PEOPLE THINKING??

Hi Lenoxave, I feel your pain. Even though Harleem is considered cheap in terms of NYC real estate, it is not cheap by any means. It's just ridiculously hard to be middle class in NYC and buy anything, anywhere. My wife and I recently bought a 2bedroom on FDB near striver's row for less than 500K. We looked long and hard, and almost ended up getting a subsidized 2bedroom at Beacon Towers but their timeline wouldn't work for us. Other than HDFC, I think that the cheapest 3bedroom we saw was around 520K and that was at The Bradhurst near striver's row.It's somewhat ironic, but the people who bought the earlier Harlem condos in the mid90s have already been priced out of buying in the neighborhood. Maybe you need to look in the 150s or east harlem?

If you don't like my explanation for why Harlem prices are so much lower than prices elsewhere, then present your own explanation.

I should add that I mean prices lower than everywhere in Manhattan. Compared to most other places in the country, Harlem is ridiculously expensive.

as the dollar gets stronger against the euro, you'll see the foreigners start to cash in on the prime RE that they purchased. that will cause an influx of inventory in the better areas and the Harlem condos will be worth significantly less.

Still considering a South Harlem condo around $500 psf. Monthly cost around 3K per month after 20% down. But a new rental across the street (same specs) is $1900 per month. Long term...is buying better under this scenarion?

Is this a serious question? Monthly nut 3k (okay consider tax benefit) - loss of return on dp. Rental - 1900...

3K/month before or after taxes? Are the units really the same? I am likely to buy a (more expensive) unit in South Harlem, but I love the layout (including a terrace), I don't think I can rent the equivalent, and I feel that long term -- 5+ years -- I won't regret it. I wouldn't feel that way about most of the cookie cutter and/or cheaply constructed buildings I've seen in the neighborhood.

Don't you feel nervous looking at the price trajectory though?

There is one difference. Doorman vs. no doorman. The units are across the street form each other. The rental is newer than the condo. Its 3K before any tax benefit.

Are you including the cost of cc/maintence?

It still seems wierd that a new building would not have a doorman - are they really comparable in terms of finishes? If they are, it doesn't make sense to buy. From what I can tell a doorman is worth a 15%-20% premium at most.

Includes the maint. (750 per month) with 20 yrs. left on the 421-A. The finishes are comparable.

I can't imagine it make sense to buy right now then. Say your tax rate is around 20%, then post tax cost is 2,400 (actual tax rate is probably higher but it's not all interest). Say doorman is worth 15%, that's 2,185. It's still about 10% cheaper to rent, and that's not counting the opportunity cost on your downpayment and you only get the refund at the end of the year.. I think there is enough supply right now around there, that it's hard to make the argument either rents or sales prices will go up in the near future. At least don't buy on a 5 year hold.

Listen, I bought in Harlem, but that was the townhouse market so you don't have the oversupply issue to the same extent (although you still have "supply" of shells, etc.), especially since my criteria were so specific (20 feet wide, certain blocks in South Harlem, etc.). But I bought my lifetime place, so it's a little different; I don't expect to be able to sell it in the next 5 years and break even. Even still, I went through the buy/rent math to get to reasonable floor on value. You can't totally ignore it.

Tax rate 20%... wish it were so! Given city/state/federal deductibility of mortgage interest, many face 40%+ And watch out for the sunset of 2001 federal rate reductions - could send those rates higher. Scheduled to happen next year and might occur. Still seems to be up in the air.

It's a simplifying assumption - remember even though it's mostly interest, it's not all interest. And not all of that $3k is tax deductible ... $750 of it is cc/maintence of which probably none is property tax (due to tax abatement) so none of it's deductible.

Zero tax deductibility on the $750. When does the buy vs. rent discussion under this scenario ever lead itself to be pro-buy?

On a simplified basis, if rents rise 10% or prices fall 10% - assuming the tax calcuation is correct (you should use your own tax rate though), then the carry would be equal.

But other factors are also important:

1) When do you expect to sell?
2) What kind of post-tax return can you expect on your downpayment?
3) Where do you think prices will go over this time frame?

Obviously 1) is easier to anwser than 2) and 3). But if you want to sell in the next 5 years, you'll only pay down about $30k of principal (assuming $500k purchase price and 20% down), which will not really even cover your transaction costs. So you'd be banking on appreciation to cover transaction costs - and I'd see more risk of prices being lower than higher over the next 5 years. Over a 10 year period, it gets more interesting - there you would have paid down $70k of principal, and it's more likely prices will be flat or higher than they are now (still not guaranteed, but much more likely), and it's likely that your monthly carrying costs will be lower than rents (which should go up with inflation, but again, none of this is guaranteed). You still need to factor in the opportunity costs of your downpayment, which would be $20k over 5 years and $50k over 10 years if you get 4% post-taxes.

But there are intangibles of course - how much is customization worth to you? IMO, I think far less in a run of the mill 2 bedroom than something larger, as there is only so much you can do with the space.

Purchase price is closer to 540K. Plan to stay there at least 15 years. Prices? As an investment, will it do better than a fixed rate of 8.5% on a tax-deffered annuity with a 15K annual contribution over that period?

Housing dollars and investment dollars are not the same thing.

Where is a fixed-rate 8.5% annuity available?

First, I want to know where you can get this kind of rate of return - I'm jealous. Is it something public?

Anyway, at 8.5% tax-deferred, your downpayment will be worth $360k, for a gain of $250k, so you have about a $150k gain after taxes. You'll have paid about $150k of your mortgage down, so even without appreciation, you'll pretty much breakeven. Over 15 years, of course, the chances are the asset will appreciate - even if you bought in 1987, by 2002 the asset would have appreciated - so the odds are, you'll come out ahead.

You'd have slight negative carry at first - only 10% or so - but over time you'll probably have very positive carry .. rents will go up and your payment is locked in, except for cc/maintence which you also have to assume will go up with inflation.

In this context, if you love it, maybe you go for it. You HAVE to be okay with the fact that in 1-2 years it is very likely somebody will get the same thing for cheaper - just because of the condo glut. RENTS may well even be cheaper because of this. If you're the kind of person who this is going to bother, then don't do it.

The last thing you have going for you over a long-term hold is that over the very long term - 15 years -the gap between Harlem and mainstream Manhattan prices should shrink. Because it's "farther up" it's unlikely it will get the pricing of premium neighborhoods, but there's no reason in 15 years it won't catch up, with, say, Morgninside Heights where prices are a good 30-35% higher.

But again, this is dependent on a super long-term hold AND your not being uncomfortable with the fact that you could probably get it cheaper in a year or two.

Its the current rate for nyc teacher's retirement system annuity,

Kspeak owned by bloom.

Flmao. Hey kspeak just saw a $1.5mm townhouse in Harlem, 5th ave go by my ticker. There goes your $500k in equity in 12 months. Wow, $500k would buy me a nice used oyster/swan to take around the med/tahiti. Oh well you never wanted to do stuff like that anyuowz, right?

Back to the OP's original thought, unless you find a really NICE deal in Harlem, its probably better to wait a lil while still.
There's an awful lot of market rate new-Condos in Harlem!
High-Priced [for Harlem] 'Livemore' is [IMHO] nicely constructed and spacious, with some of 'unique' layouts, and selling real quickly even in these times.
The other Projects, apparently not so much!
Maybe things will pick up in summer into fall, but we're willing to keep looking.
Wall Street seems to be on another rollercoaster ride that might take a while to settle, and the REAL employment outlook isnt that great, and credit seems pretty tight an' getting tighter, even at 'great, low, rates!'
Sounds like time to bide . . .

hey w67st . . . where was that TH?
Looked into a few of those too, but with the better neighborhood shells at 800K . . . . needing maybe another 600K of work, the numbers dont really seem to work, even with rental income!
Saw 3 or so on 119 off fifth in the 1.5 range!
Good if you can handle the number$ . . . . I guess . . . . more power to ya!

Economics of buying / renting doesn't work. Cap rates of harlem townhouses are typically <4.5%, which is less than the cost of a mortgage.

Furthermore, most harlem buyers are reaching pretty far. I understand that many TH purchases are done with 5 year ARMs to allow buyers to qualify on a DTI basis. Rising rates will slam affordability of harlem properties. Rising rates will also force developers to sell, since commercial construction loans are typically floating rate loans - With low rates, developers are willing to hold on to property. This can't go on forever.

LENOX - the places on 119th st are a rip off. There was a 15-footer sold for less than $1MM a few weeks ago. That is the comp. The selling brokers think that block is comparable to the comps west of ACP and on MMP. What a joke - that block is nothing special.

2 months have past since this thread. Its the middle of June. Gulf oil spewin', Europe meltin'. Anyone see movement on Harlem prices or hurry up and wait?

I don't think the Gulf Spill is going to affect Harlem prices unless it significantly affects the price of fried seafood. I really can't think of any other way Harlem and the Gulf are related.

Have you been checking Harlem Bespoke to see prices on recent Townhouse sales?

Happy Bloomsday.

. . . . somebody keeps signing on dotted lines at Developers "shoot for the moon" prices in Harlem!

All the Developments seem to add at least one or more 'contract signed' every subsequent time we check!

Maybe its the folks who have been waiting for an 'in' since 2006 and finally see the value for the 'pent up' demand dollar??

Is there any sort of one stop site for info on Harlem Schools?
I know the PS situation is not great, though improving; and the Charter, Magnet and Parochial Schools can offer decent alternatives; however, where do folks go to kinda get the overall school picture in Harlem??

Families must be going for some of these new Buildings . . . . where are the kids going to school??!!

No changes, but nothing will be going up in the next year or so. Check the front page of the New York Times this morning. Housing sales have slowed considerably after the tax credit expired. No rush to buy.

Lenox av

I think the best schools sites are http://insideschools.org/index12.php?f=adv and http://www.greatschools.org/search/search.page?search_type=0&q=9&state=NY&x=0&y=0&c=school

I'm not aware of a Harlem only school blog. Certainly the schools in Harlem are a chicken and the egg thing. If the schools were great educated families would move there, but if families would just move there then the schools would be great.

PS 180 and PS 125 are both pretty good. In South Harlem. Most of the condos along FDB are zoned for PS 180. PS 125 is a non-zoned school and on the upswing. My neighbors do a mix of public (some local and others who moved here w/ kids already in schools on UWS can keep them there), parochial, Jewish, and private.

the columbia secondary school on morningside and 123rd is a great and relatively unknown option

THANKS for the link, Jazzman!
You too, Kspeak and Joedavis, for the recommendations . . . .

Kinda' just adding it to the general mix to check into, even though its a Bronx Charter and a Riverdale Private for now.
Later on down the road, Randolph Campus is the only Harlem High that anyone we talk to, mentions . . . .
Prefer though that the kids test into a specialized High, preferably Stuy!-Luckily plenty of time before then.

Still waiting for the Harlem Prices to ease a lil bit, and the neighborhood to still keep its Potential!
[yeah . . . . I know!--Potential on the upswing with an ease in pricing is NOT the way it works!]

In the meanwhile, that is, the next 12 or so months, hoping for that small 3 bedroom [1200 sq. ft will work] for less than 500K, make that, WAY less, with common charges that dont require a second mortgage.

hey 5th on tha Park would be nice!!
. . . and they DID lower prices!--now they are just sky high, as opposed to being crazy-ridiculous sky high!

we took a look at the building open house for kicks!
The Units are sweeeet: large with great city views! . . . But to us, those are Powerball-winner prices!!

If the after tax cost per month to buy is $2400 vs a comparable rent of $1900, that seems like a $500 savings to rent. What you have to consider is 1) whether rents will rise in the long run; and 2) how much of the mortgage payment is principal on average in the first few years. If you are paying a few hundred dollars a month in principal, then that is actually forced savings, which should not count against you in your cost analysis. $500 less $300 in principal payments = $200 premium to own. I think a lot of people ready to settle down are willing to pay $200 premium for the benefits of owning, provided they don't believe housing costs will continue to decline.

Opinions on what the current purchase price psf SHOULD be on an income restricted SOHA condo (doorman, nice finishes but nothing special, not a new construction) should be?

ADC is selling some TH's in the area for $1MM, or around $300psf. Income is restricted to ~125K/yr. Doorman condo would probably be a 10-15% premium to that. (don't ask how someone making 125k can buy a $1MM joint.)

Whos ADC and how do I reach them? . . . wait . . . . Abyssinian? . . . Are you talkin' renovated, or not?

I remember back in early 2000-2001 Abyssinian Church had brand new renovated 3-4 family TH's for 450-550K and we thought those prices were 'shoot for the moon!!'

hindsight is 20-20 or better, right!!??!!

My gut feeling is that tons of recent and not so recent buyers have negative equity in Harlem. Wait till banks foreclose on them, that's when prices will finally go back in line with incomes. Till then, owners will try to hold on for the slim chance of seeing prices go up again.

An anecdotal evidence of this happened last week. There's a blog where moms exchange info about harlem. A realtor posted 2 listings and some commented on how out of whack prices are still even though they dropped like 30%... Also there were comments on how many pulled the equity out during the bubble and feel entitled to get a buyer to pay up for that debt, even if it didn't go towards the house.

Well, some bloggers loved it (renters or others interested on buying) but the owners went ballistic "That could be me a year from now! don't be mean!" type of sentimental stuff. This tells me that many are just not accepting that they overpaid or they took out more equity than they could comfortably pay back... Also tells me that's still a very much a renters market, when did we hear "don't be mean!" from owners during the bubble? We used to hear them say "don't be a loser, buy more!".

Wait, wait, wait... don't be the sucker. If you come across a deal that gets you more space, better location and saves you $ monthly... then that's different. But till then, why the hurry? More price declines are in store when those hanging from a thread capitulate imho.

hey notadmin, can you post a link to the particular blog you mention where Harlem residents are discussing out of whack prices in harlem??!!

Re "amenities" whose relative absence keeps being mentioned on SE, I went for a long walk through Central Harlem yesterday and noticed a French bistro on 7th Ave. I had not noticed before. There's a new organic food market supposed to be opening as well. I did not make a list of all the other signs of an upper middle class neighborhood, but there were many that made me ask a rhetorical question, just what amenities ARE there that Harlem poo-pooers are missing when they say that it just isn't ready yet? I can't think of many avenues in Manhattan that have the look and feel of Morningside Avenue across from the park - a winding avenue with beautiful old apartment buildings of similar height, very little car traffic, and beautiful greenery. If there are Harlem buyers who are underwater, maybe this is an opportune time to buy, but for those who are interested I cannot stress enough the importance of exploring Harlem(s) for yourselves rather than accept the judgments of people on this forum. Not all blocks are created equal, and it's a huge collection of neighboroods, plural (East Harlem, Harlem, West Harlem/Hamilton Heights), but one cliche I'm reading a lot of is "South Harlem" or an imaginary line at 125th Street, with "better" being below, "worse" being above. This one I take issue with from having hiked the area for exercise - Bradhurst Avenue and Edgecombe Avenue and Convent Avenue are lovely when you are north of 125th Street, and I could point to lots of blocks below 125th that compare unfavorably with them. Subway access is not the only factor - there is topography and location of the many parks.

Lots of folks, including many on SE, too, hear anything about "Harlem" and literally turn a deaf ear.
I basically dont mind . . . less competition for the specific type opportunity we're searching for.

Not everyone 'defers' to 'more central' Manhattan, or is able to afford it--or wishes to squeeze themselves to be able to afford it!

Harlem is the excellent alternative! you stated it right, with your example, in your way, lowery!
Parks, Transport, and varied, Unique, Housing Stock, and more creates many options and Opportunities!

"If there are Harlem buyers who are underwater, maybe this is an opportune time to buy, but for those who are interested I cannot stress enough the importance of exploring Harlem(s) for yourselves rather than accept the judgments of people on this forum. "

of course lowery, nobody on their right mind makes their biggest purchase ever based on a blog, let alone a single blog.

a good test of whether the area is or not fringe is to walk at night alone along the park and along Morningside Avenue, say at midnight. you could run the test for yourself, with white trousers, if you arrive clean at destination, then the area changed. in safer areas there are no surprises, this is not it i'm afraid.

> If there are Harlem buyers who are underwater, maybe this is an opportune time to buy

Yep, there are, my gut feeling is that most of it comes from equity withdrawal more than buying at crazy prices. You are too early on timing I'm afraid as the opportunities will show up after those that are stretch to the limit with negative equity call it quits. If the economy stays like this, I'd say in a couple of years from now, but who knows.

For me the key is that most of those I know that bought during the housing bubble in Harlem were not Harlem wanna be people, but UWS wanna be totally priced out of it. True, a lot of locals bought thanks to lotteries and HFCD, but that buyers are not the ones that determine pricing, those buyers are subsidized by the market price buyers that set prices. How many market rate buyers would still go for Harlem if the UWS prices get more reasonable?

lenoxav the blog is harlem4kids, it's like an email group more than an online blog, so there's no link... right now the most popular topic is the bedbug infestation in the cinema at 125th. But right before that it the real estate prices. What surprised me is that not so long time ago the attitude of owners was one of slight contempt for renters, never in a million years would i thought that a "don't be mean" about prices going down would be in the cards.

> Parks, Transport, and varied, Unique, Housing Stock, and more creates many options and Opportunities!

very true. i'd say that what it needs from now on is

* in terms of safety: no drug dealings, no corner boys fighting cause of accepting a fake $20 bills. that is happening 24/7 in many corners as we speak, even in 115th and martin l king (just steps away from teh nypl). how many petty drug dealings and people taking drugs on the sidewalk during daylight did you see on park avenue? i've never seen it on the UWS and UES myself for that matter, but here in Harlem it's still tough not walk by that.

* clean! overflowing trash cans, chicken bones in teh sidewalk, that one is easy to solve

* schools... oh dear, that one is definitely not an easy one.

i am one of the uws priced out wanna bees who moved into harlem --

morningside ave is remarkably safer to walk till midnight compared to what I expected even above the park on morningside dr

there are still problems -- as mentioned -- pot smoking groups hanging around corners and trash , but some blocks are better/worse and certainly the area does not fare worse on these scores than manhattan valley -- 104 to 110 between columbus and broadway -- I would be just as scared or more to walk there late at night

did not buy speculatively -- fit the category of got a very nice place for the money, the block is fantastic and friendly....even the people who seem to gather around and smoke etc are quite polite

Drug sales and such -- have seen them, and have seen some real r=crazy derelicts, but not too different from the frequency of such sightings up the hill near Columbia where this seems to go on despite Columbia security

so in summary --- there are issues but on balance +ve

Thanks, Joe Davis. If money were no object, I would be buying on the UWS, too. But I can't afford the space I want there, so I've just entered into a contract to buy a place on Morningside Avenue. I'm also looking forward to having a nice place for the money, in a nice building, with a lovely view. I'm not a Pollyana, and I know i'll be taking some late night taxis, but I am optimistic.

Congrats and Look forward with no regrets to enjoying your new place on Morningside, lef.

Yes, it IS different, and that can also be very, very good on balance . . .
I'll bet there are a few folks who originally were directed to Harlem, 'priced out' of the UWS; who are now quite happy where they are!

I am convinced that it is what you make of it, with much room for improvement and enough enjoyment of Harlem Life now, and during the period as it improves.

It helps that I also dont mind travel around the city for different slices of Urban life!

You are right about the schools, though, notadmin!
Harlem Success Charter leads the way by leaps and bounds, but its the Independent Privates of Riverdale or UWS or the [public] Privates like Stuy for HS Choices!

Can a number (to be used as a guideline) be put on price psf in south harlem...take Graceline Court as an example (J know the building has issues) but at around 500psf is that where it should be? Or will it move to $475 or $450 or stay where it is. 5th on the Park is discounting, but is it enough in the summer of 2010. Kalahari, Livmor, Douglas overpriced or not?

I can't envision a single price psf that makes sense across South Harlem. Buildings vary, blocks vary, ameneties vary, finishes vary, units vary. I'm buying an apartment with a terrace and a terrific view -- and am certainly happy to pay more psf than I'd pay for a unit that didn't have the same pluses.

I'm not an investor; I'm buying a place to live. I figure that I ought to be happy with my choice even if prices do go down in the near future and not just if they go up.

5th/Park has finally gotten A memo, 2 years too late, but they have yet to see THE Light!
[the light that indicates occupied sold Units from Realistic Prices!]

Many of the other new Harlem Condos have really nice Units, but the buyers with needed incomes still are not quite showing up . . . .

I've seen many of the larger type Units.
Square footage price can be a lil misleading as different layouts can squeeze 1-2-3-4 bedrooms in 900-1200 sq. feet.
$450 or so/sq-ft is a good ballpark figure that should result in some real quick signatures on Contracts, though . . . . !

And those buildings and blocks vary just enuff to add some amount of X factor of note!

. . . . Graceline says they are sold out almost, but its a dark building! so is 5th!

Its a personal decision that comes down to a gut decision of likin it or not, and what ya can negotiate according to ya' pockets!!

What you say is true lef2009 and LENOXav, not asking for rock-solid price psf numbers, but as a guideline. I don't mean to appear simplistic about it.

Sellers are not yet at that $450 or so price as of yet LENOXav.

about the drug dealing in columbia, come on! i guess we are not really talking about the same neighborhood.

> 104 to 110 between columbus and broadway -- I would be just as scared or more to walk there late at night
definitely ugly, but not the kind that could show up in "the wire" if you know what i mean.

regarding prices in harlem moving forward, my gut feeling tells me that when/if the joes and lefs feel they can afford UWS, they will not even come for an open house in harlem.

how do i know that? easy! i live in harlem. it'll take a lot of visits to the very nearby corner boys to get to the point in which i say: "UWS!? no!!! Harlem is much better! the services I need are just on my own sidewalk". it's about personality, i try hard no to delude myself. that said, the neighborhood did improve a lot and keeps on improving, we just started from a very low base.

the corner boy issue, together with the sporadic shootings were literally babies kill each other (they tend to be 13 to 20), will not change quickly. just look at the drop out rates and unemployment rates of black youngsters. being entrepreneurs of the corner is the most appealing occupation, very sad indeed. then they get to do some time, and will never enter the formal labor force...

I would say that the question of what the psf value should be is answered with the current sales of Livmor, the Douglass and Parc standard. Also remaining units at Soha 118 that started selling again also put it in perspective.

This line of questioning is sort of backwards I would think. The way I have read this and other Harlem messages is that Harlem has no right to actually have any value. That it is okay for the UWS to be $1000 psf, but any of us who decide to move up to Central Harlem are insane to pay $600 psf, that we are overpaying and we should be paying $400 psf. Does that mean the UWS should be $800 or less?

What is missing is that the real estate market moves with its own forces. No one has forced the current buyers to pay $600 more or less psf, however they are doing it feeling that it is fair. so that would say that this is currently the fair value.

could it go down, sure. could it go up, sure. it really is more dependent on the economy and what people are looking for. To me the space i get for the lower psf value is worth it. i am not looking to move again anytime in the foreseable future so if the market was to dip it would not make a difference in my decision.

> This line of questioning is sort of backwards I would think. The way I have read this and other Harlem messages is that Harlem has no right to actually have any value. That it is okay for the UWS to be $1000 psf, but any of us who decide to move up to Central Harlem are insane to pay $600 psf, that we are overpaying and we should be paying $400 psf. Does that mean the UWS should be $800 or less?

What i'm saying is the following: if the UWS cost you $600 psf, so you can afford it with the same effort as you are affording Harlem, would you even consider buying in Harlem?

My answer to that depends on the composition of your household. If you expect to have kids or already have, you settle for UWS (schools, safety and more of a middle class feeling to it) or commit to private schools. If you don't plan to ever have kids you might consider Harlem in exchange for more space.

We cannot compare how buyers are gonna behave when they are not priced out from their 1st choice area with the way they behaved during the bubble, that's why i wonder what's gonna happen. Here obviously I'm taking for granted that prices will keep on going down, I don't have a doubt about that.

Where the kids are going to school and their comfort levels in a neighborhood go a very long way re family choice as to certain micro neighborhoods of Harlem vs UWS!

I could see myself choosing a particular Unit in Harlem in Condo of my choice, or even a TH with sweet outdoor space, VS UWS.
But then, . . . . I LIKE Harlem, and prefer it to UWS!
I'm good with a LIFE here and a visit elsewhere . . . .
. . . . but thats just me, and most would probably have it the other way around!
To each, their own!

Again . . . whats in YOUR pockets, and how you feel about a Unit you see, UWS, Harlem or wherever . . . .
if it does it for you, . . . . then you go for it . . . . .

As some of these sellers get a lil more desperate to move Units, and prices maintain a downward slope, PRACTICALITY will appeal to a buyer: Bang for the buck is worth taking notice!
Nothing is perfect and you make allowances to what you can afford.

But again, thats what works for me . . . .

You gotta do what moves the earth for YOU!

PS: Pookie and company on the corner, drug dealing here n there, garbage and crazy folks, but not too too much, ALL help 'preserve' a lower price in this plateau [or downward] period.

At some point, the recovery and Improvements will again kick in, and the pricing will again increase, minimizing the opportunities which may now exist . . . . .

It may very while take a while, 3-5+ years, but I can work with that.
A few others I know can handle that too!

A few others, maybe not so much . . . . .

where does that leave us?

YOUR choice!!
Choose accordingly . . .

lenox, don't take it so personally, just wondering where prices are going when people are not priced out is worth the effort imho, as it will change the pool of buyers. especially those buyers that were setting prices (market price ones versus lotteries and HDFC). it'd be interesting to know say, since 1995, how many bought at market rates and how many bought subsidized, that's just curiosity but it could be interesting to see the proportion of those setting market prices.

also i'd like to get to know the timeline of expiration of tax abatements. i'm in harlem since 2004 but got to know a lot of people that bought before with 15 year tax abatements. say you bought in 2000, the tax abatement 100% expires by 2015? mmm, wonder what the normal tax rates look like. they would still be way much lower than in other areas, right?

again, just wondering whether carrying costs, alternatives areas and the pool of future buyers will look like. that's key for prices, isn't it? more fun than to talk about the economy right now imho as it's not giving many positives lately.