@scottfits
Scott,
We met in Brooklyn last year when you did your talk and the lawyer from Florida and you were the first at the gallery. I mentioned at the time that I do real estate investment and that I love the idea of CityDAO also possibly showing citizens how to build a real estate portfolio for themselves. I’m happy to teach CityDAO members how to acquire single family homes for themselves as investment; once a person reaches 8 single family home doors with no mortgage is when one reaches true financial freedom. So I’m very happy to see this proposal put forward and with that in mind please read below and let me know what you think.
The Property: 517-519 6th street, Union City, NJ 07087
2 family Duplex style where 517 6th street is a 2 bedroom, while 519 6th street is a 3 bedroom because it has an extra bedroom in the attic. It has a shared unfinished basement and a big backyard. Located in the outskirts of NYC and right next to Jersey City & Hoboken, Union City is one of the last upcoming neighborhoods because of its proximity to Time Square only 20 minutes away via public transport and 10 minutes driving.
I’ve owned this property since 2004 and between 2016 & 2019 I listed 517 6th street on AirBnB, VRBO and others. And the property was booked most of the time until the city of Union City passed an ordinance forbidding short rentals. Right now I live at 517 6th street, while 519 is rented and I received rent for $2100.
I have recently listed 519 6th street for sale by owner and seller finance so I can take advantage of my 2% interest rate and facilitate the buy for someone else while I raise money by selling half. The reason for me wanting to sell 1 side via seller finance is for the same reasons Scott mentions market conditions but in addition because I know this neighborhood for close to 20 years and I study the property enough to know that I can get another apartment out of the same property. This is an old house with a very big backyard that can accommodate an easy extension. By extending the first and second floor by another 200 SQ FT; at which point the attic gets removed and the third floor gets added with at least 800 SQ FT Apt. So I’m essentially raising money to build another apt.
When I saw the CityDAO post about looking to buy a single family house I thought this could be a great deal. Because I already have experience having 1 side of the house as AirBnB host which I can not longer do, the property already rented so CityDAO starts to collect rent right away but what we can do is have it available for CityDAO members visiting NYC starting in the Spring of 2024 or when there is enough reservations not to need a permanent tenant but for the time being the tenant brings $2100 per month.
With the money raised I plan to secure an architect to do the blueprints for the rehab and expansion. When the market stabilizes in a year or so, I can move to build the extension and 3rd apt. At that time CitiDAO will be requested to contribute for the expansion of 519 6th street, while I cover the expansion for 517 6th street, and we can discuss if CityDAO is interested in contributing to the 3rd floor. When the third apt gets added threw will be 2: 2,320 SQ FT 3 bedrooms, 2 bath apts with ARV of $550K each and a third apt of 1 bedroom 1 bath in the third floor for with ARV $480K. During this extension and renovation is when I had plan to submit paperwork to convert to condominium and get 3 titles. In the meantime, I was looking for 50% deposit and a 15 year note on my title, till I convert to condominiums. In the case CityDAO pays the whole amount we could work in expediting the condo conversion application while still waiting for market conditions to stabilise before building 3rd unit, in the meantime CityDAO will appear as first lean in the property.
Current estimate cost of extension and rehab is around 1600 SQ FT @ 300 p SQ FT that was a quote from a construction company building new construction a block away from me at: 418 6th St #1, Union City, NJ 07087.
I posted 519 6th street for sale 10 days ago and my phone has not stopped ringing
https://www.zillow.com/homedetails/519-6th-St-APT-1-Union-City-NJ-07087/2068583927_zpid/?view=public but I’ve been going through many conversations and I’d be more interested in dealing with CityDAO because after this acquisition, we can continue to build on this and buy other properties. I currently have a company operating in Mercer County, NJ; buying, rehabbing and renting single family homes, those other other neighborhoods have much better acquisition cost for long term investors but being in Union City as the first acquisition for CityDAO works out great because is literally a stone throw away from NYC and CityDAO can use to host members and create experiences around NYC when it makes it feasible not needing tenants, because airbnb is not longer allowed to compensate for other available days.
the link below has an image with the current floorplan
https://docs.google.com/document/d/1_6H8TobKDw5TtDs7zpOELga8MYkoLP7EBCGU3ljCxgY/edit?usp=sharing
Please feel free to reach out with any questions -
@rumraisin_eth
@Augustus