578 Sterling, the little blue house near Classon

A few years ago, @eastbloc wrote

flashback...

eastbloc said:

I would be. At $950k that's still $500/square foot. A buyer would have a very hard time convincing a bank to lend even that sum given neighborhood comps.

578 Sterling, which is a block away in the right direction, is a slightly smaller single-fam. It's presently listed for $520k and has no takers in the past 90 days. Sure, it needs a reno, but $200k of work would turn it into a pretty posh pad, and the lot is 50% larger than 662's.

I'd peg the value of 662 at around $800k, tops.

Eastbloc-

578 Sterling, the little blue house in the below photo, was covered by Brownstoner today.

http://www.brownstoner.com/blog/2013/08/building-of-the-day-578-sterling-place/

As a result of recently being sold to a LLC, they speculate that it will soon be torn down, and (in a few years) the lot will feature something like the building on the left.

photo: Brownstoner

578 Sterling finally received its demolition permit on Wednesday, 3/4/2015

http://a810-bisweb.nyc.gov/bisweb/JobsQueryByNumberServlet?requestid=1&passjobnumber=321089362&passdocnumber=01

No construction plans yet, though.  

I wonder if we've reached the point where demolishing an old wood-frame house qualifies as enough "value add" to flip for significant gain.

I believe this house been vacant for quite some time.  So, I suspect the economics were similar to the lot on Franklin that used to be a community garden.

http://www.brooklynian.com/discussion/38833/730-franklin-ave-btwn-park-and-sterling-formerly-a-garden-now-a-fence-soon-to-be-a-6-story-bldg#Item_5

From my understanding the cost of constructing a building have increased substantially as a result of the building boom.   

Despite that, the economics seem to now point to "demolish and build" as opposed to merely "continue to hold".      I believe a new condo on a quiet CH street can now fetch $1000 a sq ft.

LLCs seem to be able to wait longer for their returns than others, but even they take their profits eventually.

The house has been vacant for about two years now.  It sold for the mid $400's around then, pennies on the dollar for what it's worth now.

These lots have a 5200 square foot buildable.  They're 20x131.  Property around here has been selling for $200 per buildable square foot, so you can do the math.

That part I can do.

It is my ability to predict construction costs that has been shot to hell as a result of the increasing costs.

I certainly won't be doing any constructing any time soon for mostly that reason.

The DOB is also really slow as a result of the building boom and the recent arrest of a number of its inspectors on fraud charges.

http://commercialobserver.com/2015/02/dob-overwhelmed-by-construction-demand/

http://manhattanda.org/press-release/manhattan-da’s-office-doi-nypd-announce-arrests-and-criminal-charges-widespread-briber

I hear the small construction projects are being given lowest priority, and now take about a month to get a relatively simple permit ...like demolition.

Demolition is now occurring

The demolition is stalled at the point visible above.  The crew that was doing it looked pretty ragged.  I thought they were squatters at first.  No permits posted.  No further sign of life.

It is not uncommon for laborers to be so poor they live on site.

House has now been reduced to a pile of wood.

Wood now gone.