All Forum Posts by: Eric Hajdu

Hey Tom, actually most NYC Co-ops only allow you to rent for a year or two during your whole ownership period.  Your correct that some permit rental periods beyond this time, but charge extravagant fees in the $1000's annually to do so.  They will also be more restrictive towards who you can rent the unit out to.  Also, I saw you mentioned you'd like to renovate, this process is far more complicated in a Co-op.  Sorry for all the negativity, but I really think your better off paying up a bit for a condo if your end use goal is as a rental property, best of luck.

I would like to offer a slightly more optimistic view of being a landlord in NYC.  I have been living and investing here for over twenty five years and have found it to be a very positive experience.  I have a pretty sizable network of fellow NYC landlord/investors, and none of us have ever encountered any of the horror stories that are often assumed to be commonplace here.  That said, we tend to all invest in A+ areas and rent to young professionals.  

I think there might be no better place on earth to build true wealth through real estate. Yes, the near term cap rates are minimal, but the long term equity gain is unmatched in my opinion.  I have found being a developer here is way more challenging than being a landlord, the DOB/city are far tougher than any tenant ever could be.  So, if your interested in investing in the city, don't let the headlines scare you.

Hey Mayer, you would want to start with an architect, they act as the quarterback in this process.  They will advise the engineer, contractor, expediter, etc. through the process, best of luck!

Hey Vincent, I'm not a realtor or expert, but I have invested in Brooklyn for the past 25 years.  The only advice I would give you is that you should vastly narrow down and specify your search.  Saying your looking in Brooklyn is similar to saying your looking for something in the state of Ohio.  You would benefit from clarifying your neighborhoods and price range.  There are literally hundreds of areas in Brooklyn and multi families ranging from a few hundred thousand to over 20 million.  Best of luck in your search.

Hey Joshua,

I'm currently in the throws of a development project in Brooklyn, and the $300 a sf model is a little light, especially if you plan on decent finishes.  You are correct, that this has long been the conventional figure used to estimate cost for buildable sf in NYC.  Also, I'm not sure if you are demoing an existing structure, if the structure is freestanding, etc, but this will obviously greatly affect your overall budget.

For our project, most of the material prices are in line with expectations, but where we've been shocked with recent increases is the soft cost.  Our insurance policy for the project alone was well over $100k.  Lawyers, engineer, architect, expeditor, surveyors, etc pile on the fees quickly.  We also had to negotiate access agreements with both adjoining neighbors, which added nearly another $100k.

Best of luck in your venture, feel free to contact me directly with any questions or if you would like me to pass along any of my resources.  

@Isadore Nelson yes, I know someone that recently paid $500k to get a longtime rent controlled tenant out of a Carroll Gardens Brownstone. They bought the property with tenant in place for roughly $1.5mil under market value for property when vacant. In Manhattan, these buyouts can be 7 figures.

@Isadore Nelson

From my experience in the Brooklyn market, you are most likely looking at tenant buy out instead of an eviction. It is very common here for investors to model a buy out of anywhere from $50-$500k.

If you’re getting the property for significantly under market, this strategy can still be advantageous and everyone wins, good luck.

I would like to add that in many cases in NYC, "no fee" means the unit is listed directly by the owner on Streeteasy etc., as opposed to the landlord hiring an agent and paying their fee.  I have always preferred to use an agent to rent out my BK units, as I find renters that are paying the fee are more likely to stay for longer durations, and be better qualified tenants.

Hey Robyn, I'm currently doing a full reno/expansion of a townhouse I own in Cobble Hill, feel free to message me and I can give you some info.  You might have to get an architect and pull permits for the work your describing.

Eric

Andy, I'm sorry to hear that your going through this, I don't personally know anyone dealing with such difficult tenants, but do know several Brooklyn based land lords who got tenants out in order to do reno. or dramatically increase rent.  They all used the same the tactic, money.

I would offer a generous buyout, which I know will be hard on principle, but you'll spend just as much on lawyers and preserve your sanity in the long run, wishing you the best of luck.