All Forum Posts by: Mathew Randolph

Hello Giovanni, thanks for replying. 

I think this building is in a prime location. More and more students from Columbia are moving East because the area has become safer and is much less expensive. Being nearby the 2,3,B,C subway lines is also very beneficial, as well as being one block from Central Park. If you look at the rest of the city, any street that is one block from Central Park is very highly sought after, South Harlem less so. But South Harlem is easily poised to rise in value in the near future simply due to demand and limited supply. There is a 75 unit luxury building being built on the corner of this block as we speak.  

I am very new to analyzing tax documents and homeowner data but these are the documents I found on the property. As well as a picture of a fully restored unit nearby. I wouldn't know where to start when determining the ARV of these buildings but would be eager to hear your thoughts. This would be an epic first deal if I could be involved in any way.

I see on the NYC FHA website that the maximum allowance for a 4 unit property is $1,223,475. I also saw on the website that first time home buyer loans can be given with little to no money down < 3.5%. Does this mean that I could potentially borrow $1.2M for a quad-plex as long as I have good credit and probably a guarantor and probably PMI, with nothing out of my pocket? Basically what is the best way to take advantage of this $1.2M so that I can get started as soon as possible?

Thank you

I found a cool building in South Harlem

The seller wants $2.6M for this 5 story, 7 apartment, 4500 square ft. residential building in Harlem. I estimated the total renovation costs at $1.1 million, NYC averages around $250/sqft for renovations. I've spoken with a contractor and he said that was reasonable. The building is assessed at just under $50K and is valued at around 600k. It last sold in Dec. 2010 for $815k. I spoke with the listing agent and he said the seller previously refused an offer for $2.5M, so the agent dropped him. I estimate rent to average $2500-3000 per unit. On the higher end if each unit gets washer and dryers, and has quality renovations. The building is currently gutted and needs a full overhaul.  I think the holding period would be about a year so the first year would hemorrhage cash flow (not included in the analysis above), but subsequent years would be fruitful. This area of Harlem is right by the top of Central Park, 2 separate subway stops, and is gentrifying rapidly. 

I'm looking for reasons someone might justify a lower offer, or if not, why the asking price is legitimate. Also, if my 1 year time frame for renovations is reasonable. 

I have no money and am not going to buy this building but I think its fun to run the numbers anyway.

Thank you

Mathew Randolph

Hey Alicia, I'm also interested in rental investing in NYC, and am a real estate agent in the city. The people on bigger pockets often joke about how hard it is to get started in an area like NY, but its definitely possible. Good luck to us both. Maybe our paths will cross.