a flippin' fast flip at 151 Wooster Street, for a vanishingly small 'profit'
you’ll see how it vanished
Warning: there is no typo in the following sentence. The Manhattan loft #5A at 151 Wooster Street sold on March 3 for $5mm and on February 1 for $4.65mm. The trick is that the first sale was from the developer and had long been in contract, and that the February 2011 buyers started marketing the resale 8 months before they owned it.
I just hope that they changed their mind because they decided they did not want to live there, and not because they thought they were going to make a killing on a flip. Here is another sentence without a typo: by selling at $5mm what they bought 31 days earlier for $4.65mm, these folks lost at least $80,000, and there’s no trick. That’s hardly a bath, but certainly not good news, and that is taking into account a 5% broker’s fee on the sale plus NYS and NYC transfer taxes of 1.825% on the sale after paying the 1% ‘mansion tax’ on the buy, not to mention lawyers and miscellaneous expenses. At least they did not pay a moving company (or two) and seem to have put only a $1.2mm mortgage on it (per PShark, here).
mind the gap
In broad terms, the transactions look something like this:
($46,500) ‘mansion tax’
($18,600) title insurance [roughly $4 per $1,000]
($23,070) mortgage recording tax
($250,000) brokerage fee
($91,250) transfer fees
Without paying those pesky lawyers or any condo fees (did they make a working capital contribution?), they lost $79,420. At least they did not hold on to it long. But seriously: O. U. C. H.
© Sandy Mattingly 2011