No house flippers allowed: East NY residents push for ban

Locals hope to get a cease-and-desist designation on the speculative practice that has grown in popularity and led to rising prices

New York /
Mar.March 02, 2020 11:00 AM
The New York Department of State will hold a hearing on a cease-and-desist bid for the neighborhood on March 5 (Credit: Getty Images)

The New York Department of State will hold a hearing on a cease-and-desist bid for the neighborhood on March 5 (Credit: Getty Images)

East New York residents and community leaders are pushing to ban house flippers from their neighborhood, trying to end the speculative investment play that has grown in popularity and led to rising prices.

The New York Department of State will hold a hearing on a cease-and-desist bid for the neighborhood on March 5, and if the designation is granted, East New York homeowners would be allowed to opt into a list restricting home flippers from getting in touch with them, according to The City. Those who break the law would face fines, criminal charges or the loss of their real estate licenses.

The Department of State has had the authority to grant cease-and-desist protections to neighborhoods since 1989 but has done it for just three zones in the city: two in northeastern Queens and one in the northeastern Bronx. A report in 2018 from the Center for New York City Neighborhoods found that East New York was the neighborhood where investors were flipping homes at higher rates and for higher profit margins than any other part of Brooklyn.

Lawmakers in Albany are also working on a bill that would designate all of Brooklyn as a cease-and-desist zone for five years. State Sen. Kevin Parker is sponsoring the bill, and state Sen. Julia Salazar is co-sponsoring it.

Between 2016 and 2017, flippers bought and quickly resold 246 East New York homes, according to the Center for New York City Neighborhoods. The group found that speculators sold homes at prices up to 50 percent higher than comparable non-flip sales in the neighborhood.

“The investors hold onto the homes for as little as six to nine months, not even a year before they sell it again,” the center’s Ivy Perez told The City. “These aren’t substantial rehabs. They’re just new appliances and new paint jobs.” [The City] — Eddie Small


Related Articles

arrow_forward_ios
ZD Jasper Realty's Jasper Wu with 23-17 41st Avenue (ZD Jasper, Google Maps, Getty)
GTJ sells East New York warehouse; Kartsonis, Wu cut deals
GTJ sells East New York warehouse; Kartsonis, Wu cut deals
A photo illustration depicting the massive changes at 2797 Atlantic Avenue (Google Maps, Getty Images)
Church plans 343 apartments in East New York
Church plans 343 apartments in East New York
Arlington Village at 3100-3124 Atlantic Avenue in East New York, Brooklyn (Google Maps, Getty)
Developing in downtrodden areas gets dicey
Developing in downtrodden areas gets dicey
50 Pennsylvania Avenue (LinkedIn, Pennrose)
Supermarket nabs 20K sf at Pennrose project in Brooklyn
Supermarket nabs 20K sf at Pennrose project in Brooklyn
3100-3124 Atlantic Avenue in East New York, Brooklyn (Google Maps, Getty)
Locals fear homeless shelter king will gentrify East New York
Locals fear homeless shelter king will gentrify East New York
70 Cobb Road (Google Maps)
Hamptons-sized house flip: Estate asks $72M
Hamptons-sized house flip: Estate asks $72M
CBRE's Chuck Leitner and Amazon warehouses at 12555 Flatlands Avenue and 12595 Flatlands Avenue (March Associates Construction, CBRE, iStock, Illustration by Kevin Cifuentes for The Real Deal)
CBRE affiliate buys two Amazon warehouses for $230M
CBRE affiliate buys two Amazon warehouses for $230M
Chris Ward, California assembly member for the 78th District (Twitter/asmchrisward, iStock/Photo Illustration by Steven Dilakian for The Real Deal)
Home-flip tax would punish the good guys
Home-flip tax would punish the good guys
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...