Harlem new single family house for $1.4 million

- "someone offered you a brand new, custom designed house of about 2700 sq ft with parking and with green design in Harlem near 125th St -- new construction, at a price of $1.4 to 1.5 million" = seems to be a good deal! Seems to be underpriced...although we don't know any specifics about the property.

- market uncertainty around 125th St is not of much concern given its current standing and plans for the area (ie. rezoning of 125th st., three hotel developments, Harlem Park, and the Columbia expansion, etc.)

- Can't make any comment on rates since it depeneds on your particular credit standing. Nevertheless, rates are still not too bad, historically speaking

- If your near 125th st. you're probably near transportation...this is important! If you're near 125th st and Lenox you have all the buses, trains, and even the metro north two to three blocks east.

- I would probably try to stay near 125th st.

- crime is not of much concern given the stats...check out the NY Times web sight for stats and compare Harlem to some other areas....you'll be surprised at what you find

I agree. I'm looking in Harlem also. I have spent many, many hours in the neighborhood, and I like the central area 110th to 130th, 5th Ave. to St. Nich. There are good bus lines running cross town on 116th and 125th, you're near some good to great subway stops depending on where you want to go. I am a caucasian woman with a daughter, btw. The crime statistics are quite good for this neighborhood, and I think it has a great neighborhood feel. Up higher it's more of a block by block type thing, with some blocks being great and others having loud music blaring out of windows 24/7. Also, the restaurant situation is much better around 125th (still room to go, though).

Your price seems a bit low, but only because prices for some of the new luxury developments in the area have started escalating. If you are certain you can hold onto it for awhile, and like what's being offerred, I say go ahead under these circumstances. I personally think the market has been fueled by extremely easy money, and in the short term it can't absorb the number of units being developed. In the long term, the city is anticipated to have more people with a fewer percentage of them being children (i.e., fewer people per unit, needing more units). Be very careful if you think you may need to rent it out in the near future. Depending on what you put down, and your taxes, it sounds as if your monthly costs will be in the $8000 range. Right now large townhouse apartments can be had up there for under $5000. If you can afford to eat the difference in a worst case scenario, you'll be fine. I was worried about rates as well, but it really looks as though the Fed doesn't give a rat's about the dollar, and if it raised rates significantly at this point it would cause an economic disaster at home of epic proportions.

This is one area in the city where there seems to be a number of public, often charter, schools starting up. For information regarding public schools, check out insideschools.org. Private is a different matter. Columbia opened a private school in the region recently, Cathedral isn't bad (but I'm not sure it goes through grade 12), Columbia Grammar, Trinity and Ethical are on the Upper West (along with some I'm sure I've missed). Also, the location isn't so bad for someone looking at the Riverdale schools. If you personally want local schools, your choice could be limited. To be frank, I think the shortage of school spots is about to seriously affect many families. If you don't have children yet, or they are very young, some relief may be in sight, albeit long-term at best.

I'd take the new with parking. It's different (green design is great, asthma rates have been skyrocketing and it will be a plus with many parents, generally a plus with most) and I've been hearing some negative talk about townhouse pricing generally up there. (Although, given the finite number of townhouses in Manhattan I expect that will change). Do a search, I think it was a month or two ago someone did an article on the area, with input from a number of local realtors, developers, etc. It seemed like it was decently reported.

Good luck.

Thanks both. Crime stats may or may not correlate with what you experience in daily life -- hence the question.
Any suggestions of restaurants near 125th?
The street I am looking at has no brownstones -- backs of 125th st buildings and 1 or 2 condos nearby
1 church
Good point re renting -- if there are apts as large as 2700 sq ft available for $5000 then it is just not worth doing it.
In terms of buying this, is it a positive that it is a single family home or is it scarier. It does have a garage. Finish is comparable to or better than Soha 118 etc in my opinion, but the appliances are not subzero etc -- Samsung/GE
Good points re schools too
Good to know you are a white woman with a daughter and feel safe. How far north are you? I am told that proximity to housing projects can lead to less safety -- is there any reason to believe that?

A block in Harlem with no brownstones is unusual. In light of your comments/questions...it seems that you need to do a lot more research.

Actually, a lot of the apartments are in the 1800-2000 square foot range, but often even less than $5000 (once again, that could change, that size apartment is not so common and you may see the shares leaving downtown because Harlem is getting a better reputation).

I don't actually live up there now. I rent in Peter Cooper, and have heard that they are trying to hit us with huge rent increases, despite the imminent increase in higher-level rentals on the market. I spent a couple of months looking in Central Harlem before I decided to wait to buy (partly because my husband will most likely be switching to a mostly draw system at his law firm, and won't be getting much monthly income for eight or so months.) I do feel safe, and I've been up here at night, too. I actually have conversations with the people who work in the supermarket and at Duane Reade. By the way, there is a Citarella's and a Fairway up here, but the grocery store (name escapes me) at 116th and I believe Lenox (maybe Food Fair) is no Whole Foods, but it's no Key Foods or Apple either. Quite serviceable.

I plan to rent in Harlem next February-March, and assuming I like it, one to two years later I will buy. Prices have been going up but I think they will level off. I think Soha 118 is priced very aggressively (as is 5th on the Park, one of the most disorganized sales office I have ever encountered). I think they only have contracts for less than 30 units (Soha 118), and they've had their sales office open for at least a few months. I'm pretty sure they paid almost nothing for the land (typical of many developments in Harlem, alot of them got the land for dollars from the city). Brownstone Lane II has had 4 townhouse units on the market for quite some time, possibly because they have first floor entrances on the street. Re the single family issue, some people will like it, some won't. Get ADT to put in a good alarm system, with discreet but obvious ADT stickers. It's not that expensive, and I wouldn't do it generally, but in a townhouse it may be worth it. Having said all this, your example seems much more unique than most development up here. The area is wonderful, and enough money has been committed to commercial development that I am fairly certain residential investment near 125th is a very good idea. Make sure you visit your neighbood (5 block radius up and down, two avenues at least east and west, but remember East doesn't always reflect your experience, depending on where you are) a few times at night (including a Friday night and early Saturday evening). Actually, anyone buying anywhere should do this.

There's a thread open (and recently updated) on restaurants. I firmly believe it will get better. The 125th corridor will bring a lot of chain retail. I don't think the market is hot enough for the small commercial areas nearby to escalate beyond the reach of smaller retail.. The best of both worlds, convenience and charm.

Subzero is just a pain in the ass. Poorly designed in terms of capacity and reach and hard to repair. GE is good, I am quite fond of the JennAir, Kitchenaid level of appliances. Nice, gets the job done, and doesn't scream I need an appliance to tell you what I'm worth. To be quite frank, it may be an overstatement, but I'm sort of surprised any Italian granite is left to quarry. Finishes do matter, but at a certain level so does price.

Thx again
yes this block has some buildings but I dont think they are brownstones exactly.
Soha118 and Brownstone lane -- we were interested but after going through their units and noticing bubbling floors, crooked powerpoint installations etc, decided to stay away.
Havent looked at renting -- if you are then an attractively finished building we saw was 2068 fifth avenue, and you are getting the sqft for the price you indicated, but the layout is 2br/3ba -- a bit odd.
There are large housing projects within 2 blocks of the building I am being shown -- both directions, and it is north of 125th. This is a bit of a concern since the conventional wisdom is that it may not be that safe near these projects at night
Agree on the appliances

I don't know about the projects. I'm in the gramercy/kips bay area and we have methodone clinics and a few smaller projects. I used to sense some unease, but not any more. Chicken/egg, I don't know.

I was looking in the 116th street buildings (there are large projects due south), and people in the 5th avenue building were amazingly effusive about their happiness. To a cynical downtown sort like me it was initially almost creepy.

I heard one black woman who saw a child from the neighborhood that she knew: "why aren't you in school today and where should you be."

The kid had a response, his school had a development day, and his mom was with the baby outside, so he came in to pick up some fruit. The woman praised his help, walked out with him, and started a conversation with his mother.

I have never heard an adult ask a child that they know what they are doing in my neighborhoods. Roam your area, a few different times as people have different schedules, night and day for a couple of weeks. Hang out and chat. I think you'll be amazed at how friendly this area is. (And I think they look out for each other, so getting to know them even before you move in is only to your benefit, they'll appreciate it.)

We moved in to a building that they are converting each unit brand new and renting them out in east harlem. We pay $1300 for 1 bed room and are only 1 block from the 116th and lex stop. Even with in being here only 2 months we have seen many new people move in....i think they are renting becuase i havent seen any other new buildings open othenr than SOHA 118th.
I see them building a new construction on 117th between lex and 3rd. I am hoping they are well priced condos. Like many on this chat we are willing and ready to buy in east harlem if the right deal comes out. We decided to move here first and rent to see if we like the area. So far we like it dispite one kid getting shot and killed :-( but it was drug related and I spoke to many others around the area who say this is very uncommon. Great mexican food in the area by the way ;-)

You are talking East Harlem, aren't you? That is so not in our crime rates.

Yes East Harlem.

Regarding the rental issue, remember that alot of the people interested in this area right now don't have children. Some do, but families usually go to transitional neighborhoods more slowly than young men. I think this will change, the area is great, but alot of people don't know it yet (thus the room for appreciation, but maybe not immediately)_.

If you're looking for a good quality development take a look at 50 West 127th Street between Lenox Ave and 5th Ave....I think there are still 2 or 3 units available.

It is a very nice building. I wasn't ready when I looked, and the larger units have gone. They seemed like a fantastic deal, but it would've been a strectch, and I won't stretch.

Loft 124 is also quite nice ....but that block has a ways to go....and I'm not sure how the new development (said to be anchored by Bed Bath & Beyond) going up on that corner of 125 and Lenox will impact that block. You also have The Lenox....I think its on 128th St and Lenox Ave...I've heard that the residents even have get togethers every so often. The Rhapsody is a gorgeous building on the corner of 127th St and 5th Ave....can't wait to see that building completed. There's also a new development called the St Claire on about 128th and 5th Ave.

joedavis,
I didn't mean to sound condescending, obviously you've done a lot of work yourself. I'm just very excited about this neighborhood. I don't wear flashy jewelry, Prada, etc. I genuinely am interested in people, their pasts, their futures, etc. This is wonderfully vibrant.

aboutready -- no problem
Thx for respomnding on all this
We looked at Loft124 SOho North and the others and really were surprised to find that one could get this entire house for 1.5 million (may be less) and were wondering if we got it for 1.4 which is the same as ma 2000 sq ft apt on a 4th/5th floor on Loft 124, which is better -- no maintenance, but may be the crime factor is more serious since if someone broke in you have no other people in the building
The street this building is on is 126th and is similar to Loft 124 -front is the back of 125th st buildings, no brownstones on the block just some misc buildings and vacant fenced space
but you mget 2700 sqft (this includes a 320 sq ft garage) so a little bigger + yard + roof (if one wanted to develop it), but appliances finish are not quite those in Loft 124 either. Spending this kind of money in Harlem vs a 1300 sqft apt in the Upper West Side?
On the one hand we dont need so much space, but if you get your own house would you be able to sell it for more in the future? Likely not or it would cost more now too, and restaurants and otherm aspects of quality of life on 90 to 110th st ant the broadway area are way better than Harlem

I don't think the house, in and of itself, is a factor in appreciation. Right now, it might be the opposite. Crime is low, but people still worry and having others in the building and/or a doorman could greatly reduce fear. Long-term, the house rocks. There are so few single family dwellings in this city, and the area will definitely appreciate. Just wait until Columbia expands.

The great thing about this neighborhood (unlike alphabet city in the last upswing) is that it has enough capital committed (in the 125th area) to assure a certain amount of growth in the near term. Having said that, I don't think the market overall will continue in the near term to cruise along at this pace. This will keep commercial rents low enough in the adjacent areas for new restaurants, etc. Also, there are a bunch of restaurants on the other side of Morningside Park, a bit of a hike but not that bad. Check out MaxSOHA. Spacy but nice service, very good food, great prices.

i know maxsoha -- i live in the columbia neighborhood
my concern is that the columbia expansion is already priced in to the properties in this area

In the short term, I agree. In the long term, I don't think so. Right now it seems very hard to define the parameters of the "long term." I too am feeling very cautious, which is why I decided to wait. I certainly don't think any prices are going to be rising anytime soon (except for some new developments marketers whose thinking escapes me).

If you wait, you'll certainly get something at a similar price point. Will it be a house with parking? Maybe not. If these considerations only matter to you on an investment level, I'd say wait.

If you wait I think you'll be sorry. Once the rezoning gets approved next year, prices will only increase.....sure after this whole sub-prime mess the rate of appreciation will not be as steep, but it's unlikely that prices will actually decline. Good Luck!

dg156 -- you could be right, although at the moment nothing seems to be selling at all.
The house I indicated being able to get at 1.4 or 1.5 is actually for sale close to 2 million -- being developed. My question at 1.4-1/5 was to see if the price dropped 25% would people still not find it interesting.
As far as I can tell, no one is making much headway on selling townhouses or brownstones in Harlem. Oddly, the few that I have seen sell have been right by Morningside Park and both seemed optimal for investors not live in owners
One did vanish from the market at 1.89 million in a week but that was early Septmber.
I wonder if a Manhattan correction is 15-20% as per our Mayor, whether the Harlem correction would be higher.

Joe Davis, you are a manipulative putz. Why not just ask initially with the real numbers? Some of us would give you real answers, others wouldn't. But I think you've just lost some real cred with me.

Well said, aboutready, well said...

Manipulative -- wow! you guys are warped!!1.4 to 1.5 is what I can afford, and the question in my head has been whether the price will get there and will it be worth it even if it does
Look at the original question -- clearly says,
"Suppose, someone offered you a brand new, custom designed house of about 2700 sq ft with parking and with green design in Harlem near 125th St -- new construction, at a price of $1.4 to 1.5 million, constructed in 1 year.
Would you buy it given all the uncertainties with the market and interest rates?"

It is a pure hypothetical question.
If this is manipulative and you live in Harlem or consider living there, then you have helped me tremendously with the decision.
Thanks

Actually, aboutready and others, you really helped me out, so thanks are due.

I did screen out the 140-160 area based on the comments. People seem quite enthused about 125th given the current investment in the area
I did learn that given the safety concern a condo may be preferred to a house, but that in the long term people may prefer the house
I learned that people in the area may be nice
I did learn that the garage was seen as a positive and same for the green construction
Also, I learned that while 1.4 to 1.5 was "considered a bit low" by the responders, it did not come across to them as a run out and buy deal. So, even the 25% discount off the asking price does not make people run to buy this house at this point.
Thanks

joedavis - that hasn't been my experience....I recently moved to central harlem and I see and am approached by passers-by who are basically shopping around for property. And a brownstone for 1.4 is a dream that will not materialize unless if your talking about a shell.

dg156 -- wow. so, it seems that people are still actively looking in the area, and yes at this point the chance of getting the house for $1.4 million looks zero. However, if you look at 2006 vs 2007 the increase in Harlem prices has been phenomenal. The shalls that wre 600-800 are now 1.2-1.4. So, if the market moves down 15-20% in Manhattan as many are saying, then the question is whether Harlem heads to 25% down.
Since this fellow is just starting construction on the house in question, I wondered if I should wait and track the situation and then see if it is possible to get it in the 1.4 range. But, I realize that a) this may never happen, and b) in that scenario a lot of other factors can change.
Likely, you are right -- it is a pipe dream and one shoudl move on

Joe Davis, check out Brownstone Lane II. At least as of a few weeks ago they still had 4 townhouse units left. Their larger units in the towers had sold. The townhouses, listed at around $1.4-1.8 million (in the 2200 sf area) had been on the market for some time. The finishes aren't bad, the outdoor spaces were good, and one had the advantage of a doorman, gym, etc. I can only think that the townhouses were so slow to sell because they had street entrances (and perhaps price). The Kalahari had a 2300 sf four bedroom duplex penthouse for 1.4 mil., 25 year tax abatement, low carrying charges, great outdoor space, 375 sf terrace. I don't know if they've sold their larger units, but I doubt it. I think for now the townhouse market is saturated.

Sorry for the snarky comment.

aboutready thx
we looked at Brownstone Lane II a while back -- duplex for 1.5 approx
looked fine except the floor was already bubbling up in many places and there were several other finish defects -- nothing major but since it was their model unit a bit of a concern
the doorman, gym etc are a plus
may re-check kalahari -- they were selling 1200ft units when we went and it is a bit far east

Actually, Kalahari is b/t 5th and Lenox. Their selling practices are a bit off, to my taste (and the facade). But it is a green building. There recently was a condocityblog or whatever it is saying that they had virtually sold out. I can't see how, as there are no new purchaser threads at any of the major blogs. Their larger units were really great, however, in terms of layout and outdoor space. Really nice kitchens and finishes. By the way, they got the land for almost nothing, so in the future there should be some room for negotiating (same is true of the land for Brownstone Land II and Soha118).

I didn't notice the floor issues. Good eye.

joedavis - completely understand the poor craftmanship you refer to at Brownstone Lane II....not only bubbling flrs but damage to the ceiling!....it's their model unit for crying out loud! And I haven't heard many good things about the developer, Artimus.

this was posted about 11 months ago, when incidentally things were not selling as well as they were in summer 2007 and many on this board were predicting a serious downturn and getting me excited about the prospects of getting something.
we are still not there, and the situation in the future looks grimmer.
Still not much like this has sold in Harlem. The townhouse I was interested in did not get finished I think and the fellow seems to have just given up on it. Wow!
I guess cutting the price down and selling it was worse than just abandoning things midway and sitting on it

Kalahari raised prices 11 times since summer 2007, and are still not really cutting you a deal. Same for Graceline. 50 W 127 sold out then various things came back on the market at inflated prices and are slowly working their way down
Loft124 sold out
have not followed soha118 or brownstone lane
some ugly developments -- fitzgerald -- seem to be going nowhere
Lotta which came in at a low price point relatively gave up and is a youth hostel -- their set ups were problematic I think -- windows on a noisy street (ACP) and then facing each other 5 feet across
there have been some spectacular one off reductions on some apts that never sold and then were auctioned.
Many brownstones sold at near the 1.7 to 2.5 million range, and several shells seem to be chasing down to the 1 million mark, but overall this market seems pretty dead too.
Where is the future?
At the most stagnant -- 99% probability over the next 3-5 years
declining modestly -- 10-15% -- 99% prob
declining wildly to pre-2004 prices ~ 30-50% -- doesnt feel like more than a 20-25% probability still
declining to pre-2000 prices and/or crime exploding -- 50% probability -- yes my scoring is a bit odd, but I think either they will make it with a modest change or with some lower probability all hell will break loose and with a lower probability still there will be large declines without the fires of hell burning the place down

I think it maybe goes down to pre-2004 prices but doesn't totally revert to what it was in the late 1990s. I think it is too far "over the hump" to completely revert for a bunch of reasons

- new condos: even the ones that don't sell become rentals
- educational improvements (some excellent charter schools)
- increasingly "post-racial" society w/ an Obama presidency
- new infrastructure/restaurants - e.g., restaurant/club row in West Harlem
- Columbia rezoning (although I don't think this will be massive as many thing)
- 125th street changes. Much of this is uncertain given recession but I think it happens anyway just later, especially w/ Bloomberg's 3rd term

But I also think as the whole city gets cheaper fewer people will need to move uptown, so I think prices fall dramatically. Also I think prices WAY exceeded the level of infrastructure in Harlem - yes, it has improved, but it still has a ways to go. For the record I think crime may uptick a bit, but I don't see it getting that bad.