The owners of a new construction apartment in NYC are in a pickle. Since the apartment wouldn't sell for its asking price in 2009, the owners rented it out. Now a previous potential buyer wants it and the owner wants to sell it, but a rental contract is stopping the transaction from happening. A recent boom in NY's housing market is forcing all "accidental landlords" to review new rental contracts.
The best offer on the posh apartment during the deep economic recession in 2009, was $2.2 million. The 2,000 square foot dwelling was worth almost $3 million however, making the owners decline the offer. Instead of selling, the owners drew up a 1 year lease and rented the place for $10,500 per month to a family. Everything was fine until the potential buyer offered $2.83 cash, but they can't get the renter out.
Since the buyer's market is slowly turning back to a seller's market, apartment owners in New York City are regretting renting out their once for sale homes. The New York Times are calling them "accidental landlords," people that want to get out of the renting business and back into selling. “'They’re coming up almost to asking price, but I can’t get the renter out,' sighed Victoria Shtainer, a senior vice president of Prudential Douglas Elliman, the real estate company."
The original idea was to rent the properties out while the market remained in bad shape. Now that New York real estate is picking back up, these landlords are reviewing their lease agreements to see the possibly of selling before lease-end. Not only do the rental contracts pose a problem however, but the renters themselves aren't privy to showing the house to potential buyers.
In September of 2008, owners of a 4,100-square-foot loft on East 24th Street, put the apartment up for rent. A large drop in price from $5.535 million in April 2008 to $3.995 million in July 2009 still kept the home on the market. The first renter moved out after a year, but the second renter isn't paying the same amount, in fact, it's thousands lower. Now a broker wants to make an offer, but they're stuck with the current tenant.
"'I explained to them that you can buy it with the tenant in place until Oct.1, and I can give you photographs and detailed information about it,' said Mary Higgins, an associate broker at Halstead, who has the exclusive on the property. 'But what I can’t do is open the door and let you see it.
“They say, ‘Well, if I’m still in the market in a few months ... ’ ”
Source: The New York Times
Written by Amy Munday
Huliq.com
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