House Hunters: Fixer-Upper Apartments

Buying a Fixer Upper Apartment: Tips from an Experienced Renovator/Real Estate Agent

Many people think of “fixer uppers” as tackling a gut renovation of an historic Bed-Stuy brownstone or Ditmas Park Victorian, but fixer uppers come in all shapes and sizes, so if you’re looking to purchase an apartment consider a co-op or condo in need of work. The majority of buyers do not want to take on projects as minor as small repairs, paint, and floors. Even in our current more buyer-driven real estate market, it’s no surprise that the most stylishly renovated homes are still seeing high demand. And who doesn’t want a move-in ready Instagram-worthy home?   

I worked with this client to create an updated space that sold for almost $200K above the pre-renovation value.

If you can see past dated cabinets, vinyl tile, poor layout, and even sad staging, you might be able to score a better deal, build equity, and achieve your dream home. If you have the enterprise but lack vision, work with an experienced real estate agent who can help you see past the crud, estimate costs, and connect you with renovation professionals. As it happens, I am an experienced renovator and real estate agent (!!) and here are a few fixer-upper apartment tips:

Tip #1: Establish a Budget

Whether you’re buying with cash or financing, you need a budget. Work with a qualified lender to determine your maximum purchasing power and how much cash you’ll have left after your down payment and closing costs. Establishing whether you have $5,000 or $100,000 for renovations will help determine how much work you can do – from a flooring and paint refresh to a full fresh start. If you cannot live in the unit during renovations, be sure to plan and budget for alternate housing (including extra takeout while you wait for your new kitchen or a nice gift for the friend who lets you crash).     

Refinishing the floors, a new railing, and fresh white paint were all budget solutions with a huge impact in this narrow condo.

Tip #2: Scour the Real Estate Listings

An experienced real estate agent knows how to scour hundreds of listings to find a unit with real potential. Here are a few insider tips:

Look for “sponsor unit” co-ops. A sponsor unit is still owned by the original owner or the corporation that first converted the building into co-ops. These are sometimes in original condition or renovated with minimal basic finishes. This is a chance to start fresh or add your own personal touches if some of the more major work has already been done. As an added benefit, sponsor units do not require co-op board approval and will often allow for less than a 20% down payment. 

Estate. Condition. These two words could be your best friends if you’re on the fixer-upper hunt. These units are not necessarily being sold by the heirs to a deceased owner. “Estate condition” more often refers to the condition – ranging from total wreck to in dire need of style and function updates.

Units that have been actively on the market more than 90 days without much interest might be suffering from dated finishes – or even just poor staging – and could be a good opportunity to grab a great apartment if you’re the buyer who is able to visualize the potential. A word of caution: Not every fixer upper has potential. Look for a good existing layout (or one that can be easily changed). Moving plumbing and electric are two big ticket items, and very often it is difficult, if not impossible, to move toilets and sinks in an apartment. Ask to see the building’s renovation policy and any history of renovations in the building before making an offer or signing the contract.

Search units just above your preferred max price. You might find a negotiable fixer-upper in a neighborhood you thought was our of your price range, and you can make upgrades over time. Some “move-in ready” units might have inexpensive or outmoded finishes, but have natural light, great views, a highly desirablelocation, potential to create a second or third bedroom, or original details. A unique or redeeming factor is a must and will add to future resale value. 

Gutting the lower level transformed a dingy duplex basement into a fresh lounge, and increased the pre-renovation value by almost $200K.

Tip #3: No Pain, No Gain

Whether you are handy or need to hire everything out, every renovation takes time and money, and makes a mess – so just embrace the temporary madness. Minimize stress by making a solid plan BEFORE putting a hammer through a wall. Make a list of everything you think you want to do and spend some time surfing Pinterest for design ideas. Then, get multiple bids and decide where you’re willing to compromise and cut down your wish list. Choose finishes – tile, paint colors, light fixtures, etc. – before you start work. Because unexpected issues come up with every renovation, front-end planning will help you manage changes during work. Are renovation pains worth it? Yes! You have potential to build instant equity while creating a customized apartment and achieving your dream home. Whether you’re ready to dip your paintbrush or tear down walls, there is a renovation project to fit every budget and level of enthusiasm.  

Easy Cosmetic Fixes

  • Paint. Paint. Paint. It’s no joke that paint is the cheapest and easiest way to refresh and reimagine your space. Don’t be afraid to use color…appropriately.
  • Refinish wood floors. Changing the stain color can take your apartment from dated 1980s oak to light Scandi-modern or rich traditional. 
  • Kitchen cabinet refresh. If your cabinets are in good shape, altering the color and updating hardware is an economical way to achieve a big impact. Hire a professional who specializes in cabinet painting. Trust me.
  • Bathroom tile and vanity. If your tile is satisfactory, new grout can go a long way to making the entire space feel new again without creating a huge mess. Changing out the vanity, medicine cabinet, and light fixture might be all you need to to go from blah to spa.

  Bang for Your Buck

  • Lighting. Think about improving the amount, quality, and placement of light, in additional to stylish fixtures. 
  • Built-ins. Custom or semi-custom, when you live in an apartment, storage is everything and built-ins can be life-changing. 
  • Exposing brick, beams, or other original features. Create something your friends will want to Instagram. Unique features can also set your apartment above the competition upon resale.
  • Doors, Moldings, and Hardware – oh my! These items are often overlooked, but details are like the accessories that perfect an outfit and make an apartment look like a million bucks. 

  Pricier Projects

  • Replace kitchen cabinets. There are endless cabinet options to fit every budget. Just be sure to buy quality so they last for more than 6 months. Replace the countertops, sink, faucet, and everything else while you’re at it. It’s true that kitchens and baths sell, so if you don’t over-invest in finishes you will likely see a return.
  • Air Conditioning. If the building will allow AC, consider installing a ductless system. It changes quality of life, can reduce electric bills, and improvesresale value. 
  • Windows. If you’re buying into an older condo building, consider replacing old windows with sound and heat-reducing windows. 
  • Electric. Make sure your home inspector checks the electric. Installing a new electric panel and rewiring an apartment is doable but not cheap. 
  • Structure, foundation, roof, heat, hot water, sewer line. Keep in mind that when you’re buying an apartment, you’re also buying into a building. Review building documents for recent or planned work and have your home inspector look at these elements. The overall health of the building can affect maintenance/common charges and financial assessments on owners to pay for projects. 

Brooklyn Real Estate Outlook: Summer 2018

The first half of the 2018 real estate season is over and the numbers are in.

Erica Keberle_Brooklyn Real Estate Agent_Brooklyn Condos

Inventory is High
– Brooklyn inventory reached an all-time high.
– Manhattan inventory reached the highest level since 2011.
Sales prices started to Cool…slightly
– Overall Brooklyn prices stagnated….however…
– The Brooklyn townhouse market remains strong up to $4M.
– Desirable Brooklyn properties are still commanding multiple offers.
– Manhattan prices dropped 3% since last year.
– Queens was the only borough where prices increased.
Rental Prices are Up
– Brooklyn and Manhattan rentals reached an all-time high.

What This Means For My Buyers

Shop Around this Fall: After a typical mid-summer lull, StreetEasy predicts a large new wave of listings which will increase options for buyers.
Be Prepared: Despite high inventory we are still seeing competition among well priced, highly desirable and/or well marketed properties. Work with your Buyer’s Agent (that’s me!) to make sure you’re prepared to close a deal when you find your dream home. Prepared buyers could find they have more negotiating power as motivated sellers get nervous about moving property.
Don’t Wait TOO Long: Although it might be tempting to wait and see if the prices drop even lower, the NYC market is complicated and the buying process is deeply emotional. Now is the time to lock in the lowest interest rate to stretch your dollar as far as possible. If you have a FICO score of 720 or more and can afford a downpayment of 30% or more, you will qualify for the very best rates available. You are already starting to have a bit more leverage, particularly with listings that have been sitting on the market for more than a few weeks, which is the peak time frame during which bidding wars are most likely to occur.
If you’re serious about finding a home, take advantage of this buyer’s market NOW and realize the benefits of long-term investment in NYC’s real estate market. Find a space where you can live comfortably for 5-7 years so that you have more control over when you sell. Given historic Brownstone Brooklyn area trends, you are likely to reap a profit on your investment.

What This Means For My Sellers

Time it Right: If you are looking to market your home, list sooner rather than later (and as soon as possible after September 1st). Appreciation rates have slowed. Compounded with rising interest rates, new tax laws, global uncertainty, and stock market fluctuations, we are starting to see a leveling of the market overall. Most buyers are bidding more conservatively, and some are postponing their search, which can lead to a surplus of inventory, putting you in a position to compete for buyers’ interest. There are still plenty of motivating factors for buyers to make a move, and the market remains active with buyers seeking to expand their families, explore new job opportunities, upgrade their lifestyle, downsize, and more.
Price Wisely: Brooklyn homes are spending more time on the market at a median 53 days. Pricing is always critical, but becomes even trickier in a transitioning market. You don’t want your listing to go “stale” and face multiple price cuts, so evaluate your selling goals and active competition, and price accordingly. I can help you analyze comparable sales data and advise you candidly about market trends, including the optimal price and time in which to list your property, and any upgrades that will help facilitate your sale.
Look Better than Your Competition: Stylish staging, gorgeous photos, and targeted marketing is even more critical in a buyer’s market to ensure your property stands out as a highly desirable property, even for the pickiest buyers. Make sure to highlight your home’s best features and mitigate issues that might give buyers a reason to move on.

Erica Keberle | Brooklyn Real Estate Agent

Determining the “right” price for selling or purchasing a home is part analytics and largely a matter of experience; it’s more an art than a science. If you’re feeling puzzled about your right price or how to make your home look amazing for a sale, use the below form to contact me. Pricing and staging consultations are always on the house (pun intended)!

[contact-form to=”” subject=”Real Estate Help”][contact-field label=”Name” type=”name” required=”1″][contact-field label=”Email” type=”email” required=”1″][contact-field label=”Message” type=”text”][/contact-form]

Brooklyn Real Estate Outlook: Spring 2018

The first quarter of 2018 is over and the numbers are in: Brooklyn prices continued to set records amid a drop in the overall number of sales. Manhattan sales numbers dropped even more dramatically, accompanied by a drop in median price.

Brooklyn prices continued to set records amid a drop in the overall number of sales.

Though the new tax plan may be giving some buyers more reason for pause, other factors, like the need for more space for growing families, a desire to live within a certain neighborhood, job relocation, etc., continues to motivate purchases. There is still a high demand for homes and little inventory, which has historically translated into prices rising steadily, but we may have finally reached a point where buyers are willing to wait out the market to a certain degree.

Rather than a heated bidding war after the first weekend, the new norm is a trickle of offers. Buyers can be more hesitant to follow through and are more apt to negotiate terms and/or walk away if their needs aren’t met, but it’s still not a buyer’s market and for desirable property, competition is still fueling above-ask bids.

It’s still not a buyer’s market and for desirable property, competition is still fueling above-ask bids…Lowball offers are not necessarily effective.

For Brooklyn sellers, with available inventory selling faster and at higher prices, it is still a good time to sell. Pricing your home appropriately for the market is more critical now as you don’t want your listing to face multiple price cuts and appear stale. Staging and marketing is even more important to ensure your home  stands out as highly desirable. Our goal is to convey a lifestyle within your walls that creates a sense of urgency as soon as buyers walk in the door, so that we can bring you multiple bids and ensure a quick and easy sale.

Staging and marketing is even more critical to ensure your property stands out…

For buyers, the market remains competitive and lowball offers are not necessarily effective. Negotiations might be more possible for new condos in the $1.5M+ range as developers compete for buyers, and in the high-end $4M+ market where inventory is currently superseding demand, but sellers will also be hesitant to accept what they might consider a below market price.

Erica Keberle | Real Estate Agent | Garfield Realty

Determining the “right” price for selling or purchasing a home is part analytics and largely a matter of experience; it’s more an art than a science. If you’re feeling puzzled about your right price or how to make your home look amazing for a sale, use the below form to contact me. Pricing and staging consultations are always on the house (pun intended)!

[contact-form to=”” subject=”Real Estate Help”][contact-field label=”Name” type=”name” required=”1″][contact-field label=”Email” type=”email” required=”1″][contact-field label=”Message” type=”text”][/contact-form]