One of the fastest growing neighborhoods in New York City is Central Harlem. Rich with history and eateries like Sylvia's Restaurant - Queen of Soul Food and new infusions like Red Rooster, Central Harlem has long been a place that people come out to visit. Over the last several years, Central Harlem has transformed from a casual destination for people and turned into a neighborhood to which people want to move. This could explain the development of the Whole Foods on 125th Street and Malcolm X. For property buyers, there are numerous types of housing stock to consider in Central Harlem.
Central Harlem Condos and Co-Ops
The majority of available housing stock in Central Harlem consists of condos and co-ops. For those trying to understand the differences between condos and co-ops, as well as the pros and cons of each, we would highly recommend reviewing this guide. Currently there are multiple new condo developments breaking ground and completing development in Central Harlem. Most notably, The Aurum, a 94-unit condo building located on the corner of 131st St. and Adam Clayton Powell Jr. Blvd. is going starting closings in the coming weeks. Most of the older apartments available in Central Harlem will consist of co-ops.
Central Harlem condos generally have generous 25-year 421A tax abatements, which makes them incredibly attractive to homebuyers. The most recently developed Central Harlem condos are also full-service buildings with doormen, amenities such as lounges, outdoor decks and fitness centers. Some of the older Central Harlem condos will generally be much more boutique-style buildings that do not have the same amenity package that the newer, larger Central Harlem condo developments will have.
Central Harlem Brownstones
Central Harlem brownstones have become as hot and exciting for new buyers as the Brooklyn brownstone. With limited inventory, Central Harlem brownstones are often selling in the $2 Million price range and up. It's important to note the many important nuances that homebuyers need to consider prior to purchasing a Central Harlem brownstone.
Condition on Paper of the Central Harlem Brownstone
So you might assume that the first thing you will want to consider for the purchase of a Central Harlem brownstone would be the physical condition. You are absolutely right! We will get to that shortly, but remember that these Central Harlem brownstones are more than just their looks.
Many Central Harlem brownstones used to have Single Room Occupancy (SRO) status. SROs are properties where rooms are rented out to individual tenants and where they share common amenities, such as the kitchen and bathroom. So while many Central Harlem brownstones no longer operate as SROs, on paper, they may still be classified as such. The only way that you could make the purchase of an SRO worthwhile is if they come with a certificate of non-harassment, which means that the former SRO resident or heir of the SRO resident has signed over the rights of the room which they were renting. Without this certificate, you may be sitting on a money pit that you can't renovate. Also, you will likely have to hire a professional investigator to track down who needs to sign the certificate(s) of non-harassment for your Central Harlem brownstone. These people may ask for several hundred thousands in cash just to sign this document if they know what is at stake.
Certificates of Occupancy
Additionally, you will want to ensure that the Central Harlem brownstone you are looking at has the appropriate certificate of occupancy. This means that if the property is marketed as a multi-family, it must come with documentation that it is a legal two-family or three-family Central Harlem brownstone. Otherwise, you may find yourself with a problem if the NYC Department of Buildings investigates, which may require you to re-configure floor plans, electrical and plumbing work. This could become a costly issue that you will want to avoid at all costs. You may already have a desire to conduct a renovation, which is great, but dealing with both a renovation and legal, permitting issues may be something that you do not want to deal with. This is why it's essential to hire a great NYC real estate lawyer who can steer you clear of these types of pitfalls.
Physical Condition of the Central Harlem Brownstone
There are numerous conditions in which you can purchase your Central Harlem Brownstone. Several brownstones have been sitting abandoned in Central Harlem for many years. You can generally see the wear and tear on the exterior, inclusive of deteriorating facade, boarded up and bricked over windows, large locks on doors and "Do Not Trespass" signs. This type of property represents the type of condition a developer would buy at the right price. This type of Central Harlem brownstone would likely come without certificates of occupancy and non-harassment. These will go for under $1M, and it would likely take an extensive period of time (several years) to go through the permitting process and renovation to bring this Central Harlem brownstone back to a pristine condition.
Below, you will find a picture of an actual property that we walked across in Central Harlem.
A developer would buy the building above and turn it into a property like you see below, also located in Central Harlem. Notice the addition up top. No developer would buy a property in such a dilapidated condition without the intent of building this addition. Financially, it wouldn't be worthwhile otherwise. This property is incredibly narrow and likely will serve as several apartments. An owner may also have an owner's duplex or triplex with several units creating rental income. Based on the fence around it, it still seems like there is a renovation finishing up.
The next image shows a wider Central Harlem brownstone with the same type of work that was conducted in the prior image. This type of building may still be used as 3 apartments, with an owner's triplex and several other units. Buildings like these also occasionally get turned into condos, but it is more likely to find these chopped up into multi-family properties. Either way, developer would buy a building that looks like the boarded up brownstone and turn it into this because otherwise there is not enough money left to make on the flip.
It's important to note that there also many beautiful Central Harlem brownstones that have been family-owned for generations. When these come on the market, they will generally show well-cared for character and will be marketed at a premium.
If you're considering Central Harlem, there is still an opportunity to get into the market. The first step is educating yourself and walking around the neighborhood and getting a sense for the neighborhood. At Blooming Sky, we're always happy to speak with you about NYC real estate market opportunities, so make sure to reach out to us at email@example.com.