Local Housing Market Headed for the Trash Can?

Experts, that trem always makes me laugh becasue "experts" are usually get things so wrong.

Posted by: guest at February 4, 2008 9:19 AM

A correction of 20% from the highs of a year ago would hardly be a disaster.

Posted by: guest at February 4, 2008 9:27 AM

This is inevitable and a natural part of the market cycle.

Posted by: guest at February 4, 2008 9:30 AM

Open houses were packed yesterday!

Posted by: guest at February 4, 2008 9:34 AM

it is just a matter of time 5-7% reductions in each of the next few years is all it takes

oh it's different here i forgot.

my ass

Posted by: guest at February 4, 2008 9:34 AM

I have been predicting a major decline here for years BUT the truth is no one knows.....including the NYT.
One month ago this was an easy prediction, now with the Fed lowering and possibly a raise in the amount of conforming loans - the possibility exists for home prices to stay where they are in NYC.

In my part of Park Slope - northern/lower, reslae condo prices seem to have maintained their high levels and Brownstones are still appreciating.

Posted by: guest at February 4, 2008 9:43 AM

do any of you know where interest rates were in the 80s??? I suspect not. The high rates; in the teens for those of you who are too young to remember, were the primarty cause and certainly the accelerant of the downturn.

Posted by: guest at February 4, 2008 10:04 AM

As many have already noted, a correction of 15% or even 20% would NOT be a problem because values have been overinflated for a few years now. I see no cause for panic.

Posted by: guest at February 4, 2008 10:14 AM

here's a link with a chart for 30-year mortgage rates from the 1970s to now...

http://www.phoenixrealestateguy.com/30-year-mortgage-rate-trend-rate-chasing/127

Posted by: guest at February 4, 2008 10:14 AM

if prices go down 20%, we'll be where we were in late 2006.

sucks if you bought very recently, but otherwise no big deal.

Posted by: guest at February 4, 2008 10:14 AM

I don't think anyone bought in 2006 hoping to flip. If they did they had their head in the sand. People buying in 2006 probably intended to stay there 5-10yrs, in which case this isn't a problem.

Posted by: guest at February 4, 2008 10:18 AM

A 20% decline today is greater (in dollar terms) then last years 20% increase

Posted by: guest at February 4, 2008 10:22 AM

It's nice to hear people being level-headed about this. We happened to buy in late 2006 and honestly, we're not panicking either because a) we intend to stay for a while and b) we just refinanced our mortgage and have lowered our monthly payments significantly. Also, even if you do want/need/have to sell, what you'll be buying will have declined in value as well, so you'll be paying less for an upgrade than you would have a few years ago. I don't think it's that bad.

Posted by: guest at February 4, 2008 10:26 AM

"No big deal":
If you buy a two million dollar house today expecting a 10% price correction in the next year, that means you are willing to pay an extra $200,000 to own this year instead of next year.

If you have $200,000 that you are happy to throw away like that, why not do something useful with it? Or take a year off from work and travel around the world?

Posted by: guest at February 4, 2008 10:28 AM

For the person who bought recently (late 2006 to no) with lets say 10% to 15% down a 20% drop could be a disaster.

The 3Ds don't discriminate - death, divorce, disability.

Let's not talk about unemployment...

Posted by: guest at February 4, 2008 10:32 AM

Except, and this is pretty important, 10:28, the houses on the market right now suck. So sure, prices are lower but what do you buy?

The inventory is way smaller, way less to choose from. I know so many people who want to buy a house right now and take advantage of the dip in values but they are not finding anything they like well enough.

I'm SO glad we took the leap a year ago and bought our house then. Nothing has been for sale in our price range in the whole year since or listed right now, that's anywhere close to being as nice. I always look, just out of curiosity.

Posted by: guest at February 4, 2008 10:37 AM

How long are you willing to wait it out? I bought my brownstone in 1995. The previous owner purchased the property in 1986 and sold it to me for the same price 9 years later. They were under water/upside down in their house for 9 years.

Posted by: guest at February 4, 2008 10:38 AM

Some day this war's gonna end. . . .

Posted by: guest at February 4, 2008 10:40 AM

Why on earth did you buy late in 2006 when everyone was saying the market was going to go south?

Posted by: guest at February 4, 2008 10:45 AM

I agree completely with Bob Marvin, but 10:32 is right. As much as possible, be prepared for one of the 3 D's and don't overextend yourself too too much when buying property or choosing finishes in your renovation. Even in the top notch neighborhoods, once you calculate closing costs or broker's fee if you use a broker to sell, if you have to sell sooner than planned you will lose money. It just means a return to normal, people buying what they can afford. I hate anything bad to happen to the economy but these corrections and cycles that humble us all a bit, it can be a good thing. People were really getting obnoxious all over this country with going into debt to build $100K kitchens and obsessing over resale-value because they were flipping.

Posted by: guest at February 4, 2008 10:47 AM

A 20% correction with 10% down (or less) is complete financial apocalypse. No two ways about it.

Posted by: guest at February 4, 2008 10:57 AM

I think the homeless guy that stands outside of the ace supermarket on 7th has more informed things to say about real estate than 99% of you on this thread.

Posted by: guest at February 4, 2008 11:11 AM

At least that homeless guy is smart enough not to buy in a crashing market. Two years ago he would've been given a 5/1 option ARM on the spot.

Posted by: guest at February 4, 2008 11:15 AM

Bob Marvin, where you ever upside down?

Posted by: guest at February 4, 2008 11:18 AM

that's funny...i bought in the "crashing market"...(late 2006) and i couldn't be happier with my purchase.

i'm paying less than i ever would in rent for a similar size apartment.

Posted by: guest at February 4, 2008 11:18 AM

I bought my house at peak - literally if we had found it two weeks later we probably wouldn't have gotten our mortgage - so that kind of sucks. However we did get the down payment from buying upstate and selling at peak of the market, so did get some advantage from the bubble. I have observed closely and haven't seen many of these small houses that cost only slightly more than one mill in carroll gardens o am comforting myself with the fact that we were right to jump on something that doesn't come up for sale often. however we will not be able to refinance to take advantage of lower rates since prices are now steady or going down, which is too bad. also - at this rate we will not be able to take out a heloc to finance building another floor, which we wanted to do in a few years.

Posted by: guest at February 4, 2008 11:27 AM

11.18. You "could be happier" if you had a mortagae that was $100,000 less than it is now.

Posted by: guest at February 4, 2008 11:32 AM

What are people's thoughts about the low end of the housing market? I bought my Clinton Hill studio (450 sq. ft) in 2005 for 177k (with a 4.75% interest rate!), thinking that people would always be looking to buy on the low end (low and moderate income people, for example). Was this a safe assumption, or should someone like me be worried?

Posted by: guest at February 4, 2008 11:36 AM

11.36 you should be worried because in the future everyone, besides flying around in hovercars, will be mutlimillionaires and will definitely not be interested in buying anything under 3000 Sq. ft.

Posted by: guest at February 4, 2008 11:39 AM

11:36...I think the low end will hold up quite well...you are correct....anytime there is a 300K and under apartment for sale in a good area, it gets snapped up quickly here.

And just as a point of reference, I bought my studio at the top of the market...in north park slope for 250K in late 2006. I sold it two months ago for 339K.

So not only does the market seem to be holding up, despite what people on this thread say, but the smaller, "cheaper" apartments go fast.

I sold mine in a week, had 4 offers over my 329K asking price and found an amazing 1 bedroom around the corner that I bought fsbo from someone I had met in Prospect Park...

I'd say you are better than fine, 11:36.

Aint' no way your studio will ever sell for less than 200K again, I do not think.

Posted by: guest at February 4, 2008 11:41 AM

Folks with Adjustable Rate Mortgages who were hoping to refi before reset are screwed. That pretty includes everyone who purchased since 2006.
If you have a fixed rate mortgage and you are currently comfortable with your payments, you should be fine.

Posted by: guest at February 4, 2008 11:48 AM

Nobody should buy a place that they can't afford now, as is. Also, no one should go into a housing purchase without thinking that he/she's will live there for a long time.

Having written that, lives change. I do feel for that buyer who really and truly thought that he/she would stay in the house forever and ever only to discover that five years later that their lives are taking them elsewhere and they need to sell. I think that many would love to have Bob Marvin's 33 years in one neighborhood, but it's not always possible.

We're talking about two things here, both involving significant risk: those who buy to flip and those who buy more than they can afford right now with the hopes that increasing values will allow for a refinance out of an adjustable rate mortgage. About the latter, maybe a good dose of common sense on behalf of buyers (Gee, maybe we shouldn't borrow to the absolute limit. What if one of us loses our job?) and lenders (Gosh, maybe we should calculate groceries into their monthly expenses) is needed.

Posted by: guest at February 4, 2008 12:05 PM

Lovely fields of beautiful tulips, swaying in the breeze.

Posted by: guest at February 4, 2008 12:07 PM

If you are looking to history - studios got hit the worst in the last RE meltdown in NYC

Posted by: guest at February 4, 2008 12:07 PM

listen, if a 20% drop = financial catastrophe for you, you overextended and bought a place you couldn't afford.

I'm sick of feeling sorry for people who can't keep their wallets shut if they can't afford something.

Posted by: guest at February 4, 2008 12:08 PM

Seriously, someone needs to go by The What's bunker and see if he's okay. Dead silence. Creepy...

Posted by: guest at February 4, 2008 12:13 PM

Anyone with good credit and an ARM that is going to reset will be. . . DOING JUST FINE.
Mine will jumpo by 2.75 above the 2 year fed funds rate. . or way under 6% as things stand now.
That was a way better move than getting a 30 year fixed and paying more every month.
Yes it's more than 4.75 or 4.875 I got a few years ago, but not bad at all.
All the doom and gloom-sayers obviously don't have a clue about how these mortgages really work.
If you are in a subprime loan or got scammed somehow, it's not fun. but that's not most of the Brownstoner types.
And no! I'm not a broker or whatever and I;m not saying prices will rise forever--just trying to give a dose of reality.

Posted by: guest at February 4, 2008 12:15 PM

12:07...studios also did incredibly well during the housing run-up (double digit gains for quite a few years). So what was your point?

Posted by: guest at February 4, 2008 12:17 PM

Perhaps the poster's point was that last time real estate went down, studios were hard hit? And perhaps if prices go down here, that could happen again?

Posted by: guest at February 4, 2008 12:25 PM

12:15, what kind of loan do you have thats tied to fed funds? FF is currently 3% plus 2.75% margin is 5.75%. It's less than 6%, but not by much. What happens when rates rise?

Posted by: guest at February 4, 2008 12:30 PM

all units went down in the last housing crash.

not just studios.

2 bedrooms went down the most.

that's why i'm asking what the point was, other than to single out someone who just said they purchased a studio in clinton hill, and that 12:07 wants to make them feel like shit.

Posted by: guest at February 4, 2008 12:43 PM

Priceless photo.

Posted by: guest at February 4, 2008 12:44 PM

Hmmmm. Preoccupation with the local market. Yeah, I'd say vaseline will soon be sold out.

Posted by: guest at February 4, 2008 12:47 PM

Actually no - in the last crash studios and small one bedrooms went down the most (% wise) and they were also difficult to sell because Banks did not want to lend on them.

Whats the point? - that historically the low-end apartment was not necessarily a safe-haven in a downturn....As you should know....past performance is not a guarantee of future results.

FSRG

Posted by: guest at February 4, 2008 12:54 PM

"Nevertheless, Manhattan—and by proxy, pricey Brooklyn—has so far mostly weathered the national housing meltdown, and the decline in values here isn’t expected to be as bad as in our outlying suburbs."

SO FAR, the suburbs have weathered the meltdown as well. Five percent is hardly a serious correction for property values that have at least doubled (inflation-adjusted) from their recent lows. Neither is 15%. We shall SEE what lies ahead. And what's expected depends on who you ask. Noriel Roubini anybody?

Posted by: guest at February 4, 2008 12:55 PM

"...more cracks in the housing market have begun to show, and the trend is reminding some analysts of the severe downturn in the region during the recession that followed the boom years of the late 1980s."

Deja-vu...

http://njrereport.com/80sbubble.htm

Posted by: guest at February 4, 2008 1:03 PM

Most ARM resets are tied to fed funds rate. 12:30, that's how ARM resets work. Each year, you get a new rate.
Btw, the fed funds rate is now in free fall mode, so the real question is what happens if it goes down, not goes up.
If your ARM is resetting soon, your rate for this year will be great. Probably the same for next year too since short term rates are plunging.
If it looks like it's going up, you have to refi into a new loan.
Anyone with a brain factors that in when they get the loan in the first place and makes sure they either 1) have resources to refi if they have to or 2) is ready to eat a higher rate for a year or two.
Otherwise, just pay more every day with a 30 year fixed loan, sleep tight and watch the bank get fat.

Posted by: guest at February 4, 2008 1:07 PM

"keep trying, eventually you'll be able to spell 'doubled.'"

LOL @ 9:54.

Posted by: guest at February 4, 2008 1:10 PM

I just bought my first place last year and just found out this weekend that I'm getting $10,000 back in taxes this year!!!!

I love owning!!!!

Posted by: guest at February 4, 2008 1:12 PM

Hmmm - all the naysayers have been saying not to buy for the past 7 years.

In those 7 seven years I have made a million dollars in equity off an $80K downpayment.

Not to mention the tax breaks, and enjoyment I have living in a much nicer place than any rental.

In the next 7 years while the naysayers keep on saying it is a horrible time to buy, I may not make any equity or I may make another million.

Renters will make nothing.

If you can afford to get into the market and sit on it for 5-10 years you will do fine.

I believe that now is a great time to buy - low rates of borrowing and a little softness in price.

If the RE market in the rest of the nation starts to level off and NYC RE prices havent tanked - what do you think is going to happen?

Another 20% increase year to year.

Sneaky Pete

Posted by: guest at February 4, 2008 1:16 PM

1:07, your financial ignorance will be your undoing. You have absolutely no idea what you are talking about!!

Posted by: guest at February 4, 2008 1:17 PM

The gloom and doom people crack me up. When there is an actual downturn in the Manhattan prime Brooklyn market, then people can start yelling bloodbath.

Keep in mind (i) no one can predict the RE market (I bought at the end of 2005, when people were predicting a huge downturn in 2006), so (ii) buy a place you can afford and think that you can live in for a few years at least, and don't try to time the market.

The 1980s had a change in the tax law which made real estate investing less attractive as a tax shelter and high interest rates. Plus, Manhattan was a less desirable place for people to raise a family etc.--ie, more crime and dirt. So I don't see huge drops in NYC real estate soon.

Markets go up and down, and the market may be soft for the next couple of years, but, if I wanted to buy now I would buy now.

Posted by: guest at February 4, 2008 1:18 PM

"If you can afford to get into the market and sit on it for 5-10 years you will do fine."

With all do respect, that is DUMB DUMB DUMB...STUPID STUPID STUPID. That's what people thought in the late 80's. Many, inluding Donald Trump, got whacked! Like now, they bought high and sold low. Do you realize what top-of-the-market means?

Posted by: guest at February 4, 2008 1:24 PM

1:24 - hmmm Donald Trump is now wealthier than he ever was based on gains in real estate. He is a billionaire.

I bet all those who bought in the 80's are now millionaires many times over.

Have you ever purchased real estate? If so how much money have you made? It must have been massive amounts to call us RE miilionaires Dumb.

What is your plan to "Rent your way to Financial Independence?"

Posted by: guest at February 4, 2008 1:28 PM

I bet you none of the Forbes Richest People are renters.

Posted by: guest at February 4, 2008 1:32 PM

you mean you're getting taxes back on something you wouldn't have been paying in the first place if you didn't have a mortgage? Whoopee.

Posted by: guest at February 4, 2008 1:37 PM

whats your plan at tapping your millions 1.28, sell your house and live in a box on the proceeds?

Posted by: guest at February 4, 2008 1:38 PM

1:37:

I own a studio in the North Slope...my mortgage payment AND maintenance come to roughly 1500 and I'm getting back 10 grand.

You don't think that's a pretty good deal for housing in NYC??? Especially considering the fact that I love my neighborhood, apartment and building?

I'd love to know how you are making out better than that renting...

Posted by: guest at February 4, 2008 1:40 PM

1.12 - great! you can put it towardss paying your property taxes and homeowners insurance !!!

Posted by: guest at February 4, 2008 1:43 PM

Right - 1.40, lets guess your mortgage is 1000. So you paid 12,000 this year and you're getting 10,000 of that back.

Methinks your tax rebate hasn't got that much to do with your mortgage interest deduction.

Unless you're in the 80% tax bracket of course.

Posted by: guest at February 4, 2008 1:46 PM

Yep...my homeowners insurance is $220 bucks a year and property taxes are covered in my maint.

I'm actually buying a Vespa and an iphone!

Doin my part to help the economy!!!

Posted by: guest at February 4, 2008 1:47 PM

Let's just say I got back 3K last year, so 7k of it has to do with the house.

And I work from home now some (wasn't allowed in my previous rental) and so I get to write a lot more off than I used to.

Posted by: guest at February 4, 2008 1:49 PM

I'd like to see someone get a 10,000 tax rebate from the mortgage interest deduction on a $12,000 year interest payment!!! LMAO!

Posted by: guest at February 4, 2008 1:52 PM

you need to read 1:52

it has to do with having a home office also.

which i never used to be able to have in my rental before. they didn't allow clients to come in like that.

so yes, i'm basically getting 7K more than i ever used to living in a rental.

jeez. everyone likes to hate people who are happy on this board.

Posted by: guest at February 4, 2008 1:54 PM

1:32 - and I guarantee you NONE of the people on the Forbes list got there by appreciation on their primary place of residence (or in fact any RE that they live in).

1:18 is exactly right - no one knows what will happen...But one thing is for sure

right now cost of ownership favors renting in NYC and therefore if sale prices stay flat, or decline you will be much better off renting however if prices continue appreciating then you will be much better off owning.

i.e. the renting vs. owning debate is pointless because it depends on knowing what the future will bring - which no one knows.

Posted by: guest at February 4, 2008 2:02 PM

1:54 - - if you are legitimatley writing off part of your home as a Home office then factoring that in and claiming it as a deal on "housing" is totally misleading (and irrelevant to the debate).

Additionally have fun getting audited by the IRS (since it sounds like you are claiming 50% of your STUDIO apartment for a home office) - which is the surest way to invite Tax scrutiny. BTW based on your insurance ($220) you clearly arent telling your insurance co that you are operating a business (with clients visiting) in the location.

Posted by: guest at February 4, 2008 2:09 PM

co-op pays the insurance, 2:09.

i pay insurance on my belongings and everything from the walls inward.

since my studio is so small, it's quite easy to say that 50% of it is being used as a home office, since it's actually more like the whole freakin thing!!

Posted by: guest at February 4, 2008 2:13 PM

Except a home office requires you to meet an "exclusive use" test - I wonder how you can use 50% of your STUDIO apartment EXCLUSIVELY for business purposes (i.e. no living)

- don't worry as long as you can pay interest and penalties they probably won't seek jail time.

Posted by: guest at February 4, 2008 2:20 PM

I'm not worried in the least.

I work for the IRS.

Posted by: guest at February 4, 2008 2:25 PM

AS a CPA I can tell you that writing off part of your home as business is definately a red flag. However,even if it raises your odds of an Audit by 500%, there is still less than a 3% you will actually be audited. In addition, they will negotiate with you and in the end you will probably still pay less than what you actually owe. It is not a crime unless you are undereporting by more than 25%.

Some risks are worth taking...

Posted by: guest at February 4, 2008 2:25 PM

You work for the IRS out of your studio apartment - and see "clients"!

I call B.S. on your entire thread

Posted by: guest at February 4, 2008 2:28 PM

Studios were definitely hard hit during the last downturn. I remember looking to buy a studio in the mid-1980s and they were running about $90,000 to $100,000 - - a few years later they were down to $60,000 and less -- and previous poster was correct that banks simply would not give mortgages on studios. Who wanted a studio for $50,000 when you could buy a 1-bedroom for $60,000?

For the poster with the 450 squ ft studio for $175 K -- if the market suffers a serious correction, you may have to stay in your place for a while, but as long as you don't mind, you will be fine. But the likelihood is that its value will (temporarily) fall more than a larger apt.

Posted by: guest at February 4, 2008 2:34 PM

My full time job is for the IRS, but I also teach music out of my home. I'm just saying...I know what's going on...I know the risks, and I don't under report so I'm not worried about it.

Posted by: guest at February 4, 2008 2:39 PM

2:02; not sure I'd agree with you that the cost of ownership favors renting in NYC. As expensive as it is to buy, rents in the city are out of control. You can buy an apartment and have similar monthly mortgage/maintenance payments as you would by renting, except you build home equity rather than just throwing cash out the window. If someone makes a conscious decision to rent because they can't afford a down payment, fine. Or if someone is just waiting because they think the market's going to crash, fine. But I hardly think that renting is the better overall economic option.

Posted by: guest at February 4, 2008 2:41 PM

I agree, 2:41.

I don't know how these people are ok to plunk down 4000 a month in rent for a 2 bedroom.

Who cares about whether it's better, worse etc. It just doesn't feel good to rent.

And that plays a big factor...perhaps the largest factor in people's decisions to buy. ..

Posted by: guest at February 4, 2008 2:46 PM

1:38 you asked about plans for tapping equity. no you dont have to sell and live in a box.

You can take a tax free $250K from the profits on the sale of your primary residence. $500K for married couples. that means you can pull out $500K tax free and put it in the bank if youlived in a property that appreciated for two years.

Also if it was an investment property you can roll over all of your gains into another rental property without paying taxes. its called a 1031.

You can make a 1031 investment property into a primary residence after a year and a day of rental.

If you make smart investments and understand what you are doing you could pull a tax free $500K out of your properties every coule of years.

I can now sell my investment property that has 2 mill in equity, buy a brownstone, and rent it out. If I am smart about it I can use a cash purchase to get a few hundred grand off the sale. After a year of renting it out, I sell my primay residence, pocket $500K and move into the investment brownstone making it my primary.

I sit on it until the market is ripe for a sale, sell it and pocket another $500K tax free and roll the $2million into another 1031.

What tax breaks on renting do you get that work out to mean hundreds of thousands in your pocket tax free?

Posted by: guest at February 4, 2008 2:50 PM

2:50....i know a lot of people who have done exactly what you say.

thanks for that.

Posted by: guest at February 4, 2008 3:01 PM

I think that what 2:50 is saying - is something the naysayers dont understand.

There are many reasons to buy, not just purchase price.

People will continue to buy during this "downturn". People will buy for many more reasons than purchase price.

People who make money from Real estate understand finance, tax shelters, etc.

People who make the argument about sagging sales price have never really been in the RE business, and have no idea how to make money.

Its the same principle on why some investors buy and make money when the stock market goes down.

Its a case of serious real estate investors vs arm chair quarterbacks.

Sneaky Pete

Posted by: guest at February 4, 2008 3:11 PM

2:41 -1st I disagree that apartment for apartment the maintainance/mortgage payment is comparable to the rent (in my experience - currently the rent is significantly less).

Second only a small portion of your monthly payment goes into equity - the rest is the same as rent - thrown away (albeit only about 60cents on the dollar for interest&tax component due to income tax savings), not to mention you lose the return on your down payment (conservatively 5%).
You have also zero maintenance costs on a rental and when you move you have minimal to zero 'closing costs' (i.e. even if your coop's value goes up a bit - brokerage, taxes, fees etc....will eat into the "profit")

So I'll say again this is a pointless debate - if housing goes up between the time you buy and sell then your right - ownership makes the most sense, and if prices fall or even stay flat - renting is probably your best bet.....what does the future hold - NO ONE knows

Posted by: guest at February 4, 2008 3:21 PM

3:21 - I feel sorry for you.

Renting is never the best bet.

Renting is something you do when you cant afford to buy.

You obviously have never owned and have no idea about finance.

You have no idea about monthly costs of owning versus renting. If you have tried to model it out, obviously your model is completely wrong.

Talk to ANY investment advisor (credible) they will NEVER tell you renting is a better bet than owning.

All will tell you to buy whenever you can and plan on being there for a while.

Do you also promote smoking to be healthier?

Posted by: guest at February 4, 2008 3:26 PM

I think the primary reason most people decide to buy instead of rent is because who out there wants to end up at 65, on a fixed income, wanting to retire and have to succumb to rent hikes, evictions or the like???

Buy if you want a stable life.

Don't buy if you're fine to wing it.

It's as easy as that.

Posted by: guest at February 4, 2008 3:26 PM

You can take a tax free $250K from the profits on the sale of your primary residence. $500K for married couples. that means you can pull out $500K tax free and put it in the bank if youlived in a property that appreciated for two years.

-Without selling - how are you going to "pull out the $"?

Also if it was an investment property you can roll over all of your gains into another rental property without paying taxes. its called a 1031.

-NOT tax free - tax deferred and only if you identify another property withing 90 days - great in a rising market - when things are a little dicier doesnt exactly leave a lot of time for due dilligence

You can make a 1031 investment property into a primary residence after a year and a day of rental.

-Except your basis is the lower amount - so when you sell you'll have a larger cap gains tax to pay.

If you make smart investments and understand what you are doing you could pull a tax free $500K out of your properties every coule of years.

-Out of your primary residence?? - Let me tell you, if you can guarantee a 500K return every couple of years on single family housing units you would be a billionaire - all these plans you have depend on 1 thing - a rising market!

Posted by: guest at February 4, 2008 3:28 PM

3:28 - you are hopeless. Keep on renting you will never be able to figure it out.

None of those things depend on a rising market.

Have you ever purchased a property?

Please explain to us how renting makes you ANY money even $1.

Posted by: guest at February 4, 2008 3:33 PM

The best way to make money in the current real estate climate (and this has always been the case) is to search out the next best thing...

Go buy in Kensington or Ditmas or Brooklyn College area. These are areas that are undervalued and while they may see a harder drop in home price in the near-term, their potential for long term growth is significant.

This is how it always worked.

Posted by: guest at February 4, 2008 3:34 PM

3:@6 - actually I own my apartment along with about $15M in commercial RE....

And anyone who tells you that under ALL circumstances owning is better then renting is (by definition) Not credible.

Please (roughly) outline a model where owning is better then renting if the value of the asset declines by 10% over the period of ownership????

Again I will repeat if the asset APPRECIATES then your right - owning is probably better - but otherwise it is likely that renting will work out better.

I mean what your saying is so stupid - In your world renting a rent-stabilized 6room apartment for $1200mo would be financially worse then buying the same apartment (lets say in Brooklyn Heights) for 2 million dollars - even if the apartment didnt appreciate over the period of ownership- its ridiculous - it ALWAYS depends - on the cost of owning, rent levels, the cost of borrowing, the lost opportunity cost of $, price appreciation, cost of up keep , etc, etc, etc.

Posted by: guest at February 4, 2008 3:36 PM

3:33 - very simple - if you invest the $ you DON'T pay in interest (after deduction still pay about 60%), don't pay in maintainace, taxes, brokerage fees, taxes, plus the return on your money that you DON'T use as a downpayment (tax free muni's? 4% in a money market, whatever) and again if your home DECLINES in value then you make money by NOT losing.

Your "I can't lose in RE" is exactly the mentality that has resulted in the disaster across the country (and eventually maybe here)-

there are no ABSOLUTES in this world except death - it always depends..... and the fact that you cannot concede this is absolutely frightening.

Posted by: guest at February 4, 2008 3:42 PM

3:34 - the "way its always worked" in RE investing was actually to make money on the INCOME; re-financing as the income levels increased and using that $ to buy more Cash flow positive properties.

The concept of buying into areas on the speculation (i.e. where income barely covers expenses) that it will improve and appreciate is a relatively new one (since for many generations, areas didnt improve for one).

Posted by: guest at February 4, 2008 3:46 PM

3:26 & 3:33 (I'm sure you're the same person)- "Renting is never the best bet." I really think you should re-evaluate that claim and not hand out that free piece of advice. There are plenty of articles, examples of how renting can be better in certain circumstances. In many cases, buying is better but that depends on how long you plan to stay, the tax bracket you're in, the amount of maintenance and property tax you have to pay, any costs of up keep etc. There are numerous calculators that will tell you how to calculate this.

Posted by: guest at February 4, 2008 3:51 PM

3:21 - I actually agree with a lot you are saying. Although, from what I've seen recently, monthly renting costs vs owning are very comparable. For example, in my building there is a unit available for rent at $4400 per month (which is 300 sq ft smaller than mine), which is almost identical to what I pay in mortgage/maintenance. And notwithstanding where we think the real estate market is headed, I think we all know that all rent does is go up year after year after year (my mortgage payment always stays the same, and in fact has the opportunity to go down depending on where rates go).

But, this is also a function of how much one is willing/able to put down and as you point out, there is an opportunity cost to that. I don't think you should discount the portion of the monthly payment that goes to equity though. Yes, while a small portion of the total loan, it is real money on a monthly basis. I make a $3,900 mortgage payment each month with about $650 of it going straight to equity. That's 17% (which obviously goes up each month). And you seem to discount the 60 cents on the dollar in the form of tax saves. That's a huge savings that turns into several thousand $ each year.

So, while I agree with you that the right answer always depends on the circumstance, by and large, if one can afford the down payment I really feel like buying is the better economic option; not to mention the sense of pride and other intangibles that come with owning vs renting.

Posted by: guest at February 4, 2008 4:03 PM

No you generally save (depending on tax braket) about 40cents on the dollar for deductible interest and taxes.
And yes you are putting a sum toward equity each month - but you have to sell to freely access that equity and there are costs to selling (including brokerage, taxes, legal etc...).
and if the value of your apartment declines (during your period of ownership) your equity is declining (potentially at a faster rate then you are accumulating)

Trust me I am not against owning - and I'll admit for some people the only way they are going to "save" is through the equity portion of their mortgage payment. But when comparing the costs of renting vs. owning on a purely financial basis (ie. no psychic benefits) - in a period of declining values it is very hard to beat renting and in a period of appreciating values it is hard to beat owning. Which period will we be in over the next 5.10,15 years - if you KNOW the answer to that - you are smarter then just about everyone.

Posted by: guest at February 4, 2008 4:17 PM

Right now, renting is underrated and owning is overrated (not saying it shouldn't be rated at all, it's just OVERrated). I'm speaking purely from a financial perspective. There are tons of other benefits similar to what you would get with a fancy car.

The reverse was true after the 90's crash. The reverse will be true after this crash. We aint there yet.

Posted by: guest at February 4, 2008 4:26 PM

Let's make this clear proponents of renting are basing that argument on "timing the market"

Any investment advisor will never counsel a client to time any market.

Your argument is that "renting is better now" is pure market timing - period.

Posted by: guest at February 4, 2008 4:34 PM

Right, sorry, meant to say 40cents. And I agree, if the market is in fact headed way down, it probably does make sense to rent. But given we don't know, if you have the money to buy and decide not to, aren't you really just trying to time the market (which I think most would agree is not the way to go)?

Also, as someone pointed out, a signicant portion of cap gains are tax free. But short of selling, you could also simply refinance your mortgage with a higher amount to pull out equity. Alternatively, take out HELOC, although there of course would be interest costs to this.

Posted by: guest at February 4, 2008 4:36 PM

I agree the "rent now" supporters are basically speculators.

Extremely misinformed speculators in my opinion

Sneaky Pete

Posted by: guest at February 4, 2008 4:37 PM

Actually the argument to OWN is based on Market timing - there is no timing involved in the cost of a rental. The financial advantage of owning is virtually entirely based on market timing -
sold that apartment in 1990 - you lose -
sold it in 2005 - you win.

Why is it so hard for you to accept that IT DEPENDS.

Look at the "rental of the day" 1t 126 4th Ave from a week ago - everyone said that it was overpriced for $2500(1br) yet compare that to a 1br in the Novo going for $570,000 (plus $400 a mo non-deductible maintainace). - these are very comparable apartments, on the same street, similar construction/quality, etc...

This is one example but a good one that illustrates absent appreciation, the cost of ownership is significantly higher for the purchase as compared to the rental

Posted by: guest at February 4, 2008 4:46 PM

The points that 4.17 and 4.26 PM are making are correct.

I have been an investor in real estate (small multi-family properties). The proposition that "you always win in real estate" is not true, and best left to the hucksters on informercials. One does need to look at the market environment to consider if you will actually come out ahead.

A couple of years ago I looked into buying condos in Brooklyn as an investment. My calculations showed that I would be suffering negative cash flow for a considerable number of years. The only justification for buying the property, therefore, was increasing appreciation (i.e. flipping). I decided not to proceed. Turns out (though I don't claim any special insight) that it was a smart move.

They are not claiming that one must try to time the market via a rent/buy decision. As they acknowledge, there are many other non-financial factors to consider. What they are saying, and what is true, is that your return in real estate will depend upon when you enter, when you exit, whether you decide to buy or rent, and very few of us (if any at all) have the savvy to read the tea leaves and know the correct decision.

Benson

Posted by: guest at February 4, 2008 4:48 PM

But anyone with a brain knows that SOMETIME in the next probably 10 years that Novo 1 bedroom is going to sell for a million.

Sure there is a small chance that won't happen, but if you get lucky and happen to still be in the place when the market is on a hot note, you are going to make more money in one transaction that you will have ever made renting.

Posted by: guest at February 4, 2008 4:50 PM

Actually Benson, if you were given that opportunity "a couple years ago" as you state, you were foolish not to buy.

So far...EVEN in 2007, Brooklyn real estate has appreciated dramatically...double digits dramatically.

Posted by: guest at February 4, 2008 4:51 PM

4.51PM;

I've done fairly well for myself, given where I started in life (the Red Hook Projects). My guru in invsting (in general) is the venerable Benjamin Graham,who wrote the classic "The Intelligent Investor", which I recommend to you. Though this book deals with the stock market (where I have made my real money), there are lessons that apply to investors in general.

I recommend that you read this book, particularly the concept of "margin of safety". It seems to me that you don't consider it. Anyone who touts an investment as a sure thing, and thinks that "dramatic" appreciation can continue, is touting the greater fool theory, which I'm not buying. If I'm selling, however, I'll be sure to look you up.

Benson.

Posted by: guest at February 4, 2008 4:59 PM

Buying Real Estate is similar in a way to platying the Lottery.

And as they say, you gotta play to win!!

Posted by: guest at February 4, 2008 5:00 PM

Really 4:50? Are you serious? You believe it is a "no-brainer" that a 1br in the Novo is going to be worth 1M within the next 10 years????

Personally I think your probably wrong - but my guess is as good as yours - that being said - if it is such a no-brainer then 1. Why havent every single new condo in these buildings sold out and 2. since you are saying that an 80% increase in 10yrs is a no-brainer, I assume you have invested every dime you have (and borrowed even more) in these projects.

Posted by: guest at February 4, 2008 5:00 PM

4:46 - that is the most moronic comment I have ever heard.

I am huge contrarian and even I think that you are a complete and utter moron.

I am glad there are people like you who will be there for the next 20 years to send me those rent checks at a 10-15% increase year on year.

Posted by: guest at February 4, 2008 5:02 PM

5:00 so true - except that if you play the lottery, statistically, you are a complete moron.

Posted by: guest at February 4, 2008 5:02 PM

Benson

No one is saying that an investment is a sure thing.

What we are saying is that real estate is an investment.

Renting is not an investment.

Posted by: guest at February 4, 2008 5:04 PM

4:46 - At a $570K purchase price you put down 20% and finance rest with a $456K mortgage. At 6% interest, 40% tax shield and $400/month maintenance your monthly costs are approx $2,200. Figure 4% closing costs ($22,800) and amortize this in over say a 5 year period and this adds an extra $380/month. So, very comparable to the monthly rent; and then you can figure that you're adding about $500 of equity with every monthly payment. This assumes no appreciation (or depreciation for that matter), so not sure how you can say the cost of owning is much more expensive.

And Benson, if you were going to purchase a couple of years ago in Brooklyn, how would you not have been ahead given the market appreciation?

Posted by: guest at February 4, 2008 5:06 PM

Hey Benson:

I've got a book for you!!

It's called...MOST PEOPLE BUY HOMES TO LIVE IN, NOT SOLELY AS INVESTMENTS.

It was a Times bestseller.

Give it a read sometime.

Posted by: guest at February 4, 2008 5:07 PM

Oh but let me agree 4:50 - if a 1br in the Novo will be worth 1M within 10years then you are 1000% correct - it definitely pays to buy.

Just curious what are you predicting regarding interest rates and local wages/income - that will support such appreciation.

Posted by: guest at February 4, 2008 5:07 PM

No person who lived on the Lower East Side 10 years ago or far west Hells Kitchen or Alphabet City or Prospect Heights or PLG would have guessed they'd be sitting on a million bucks today.

But they are if they bought.

I'm just saying...while you don't know for certain, there is a great chance that one of the greatest cities in the world, which happens to lie on an island probably will not succumb to the pressures of oversupply that most of the country adheres to.

You don't believe me....why does it cost a million bucks for a shack in Hawaii??

Posted by: guest at February 4, 2008 5:12 PM

5.04 PM;

Neither renting NOR owning your primary home is an investment. In both cases you are consuming an asset. All of the folks above who talk about how much money they made on their primary house fail to account for a number of things, such as: the interest they paid on the money they borrowed, the property taxes they paid, etc. Study after study has shown that when you analyze these factors, and consider the time value of money, a primary house winds up costing you money.

The question, therefore, is which option (owning versus renting) consumes less money, and that is what is being discussed above.

A true investment is owning a rental property, which hopefully provides a decent net return. However, note that the CAP rate for most rental investment property is now about 6%. Not bad, but not as good as the average return of the stock market.

Benson

Posted by: guest at February 4, 2008 5:13 PM

Benson and Sneaky Pete are both known idiots...I mean commenters from curbed.com

Guess they got bored over there, but if you are familiar, don't worry.

Everyone over there thinks they are as ignorant as we do over here.

Posted by: guest at February 4, 2008 5:16 PM

5.16 PM;

I have NEVER posted on Curbed. I challenge you to cite one post from me on Curbed.

Benson

Posted by: guest at February 4, 2008 5:18 PM

5:06 - You have figured in NOTHING in terms of the lost value of your 115,000 downpayment (another $380 a mo at 4%), NOTHING for real estate taxes (abated true but still be be some tax), NOTHING for the closing costs to SELL your non-appreciating apartment, NOTHING for repairs and maintainace for your apartment; (and while it isnt clear who pays on the rental at 126 4th)- generally the LL pays for UTILITIES, which you have again figured in ZERO allowance.

Again if the apartment doesn't appreciate - you'd be way ahead renting.

Posted by: guest at February 4, 2008 5:20 PM

Do you realize that you are arguing that Renting is a smarter move than buying?

That timing the market is a better strategy than a long term investment.

Unbelievable - morons.

Are you all day traders?

Posted by: guest at February 4, 2008 5:24 PM

I'd like to know WHAT person in NYC who has bought property in the past is not now living in an apartment worth more.

In some cases, double, and in some cases 20 times more.

Please let me know how that might be incorrect.

Posted by: guest at February 4, 2008 5:25 PM

I know the reaction I get at parties when I say I just bought my first place is overwhelming.

Much moreso than the stories i used to tell about when I stayed in my apartment for 3 straight days to avoid running into my landlord for fear of receiving our renewal lease.

I find the former priceless, personally.

Posted by: guest at February 4, 2008 5:28 PM

5:12 - no they are NOT - a 1br apartment in those neighborhoods generally doesnt go for 1M today, especially not in PLG or PH.

But your right, very few people would have predicted the price appreciation over the last 15 years - but what does that tell us about the next 15 and WHY (do you expect interest rates to continue to fall? Incomes to rise?? or just pure speculation?)

FYI - the median price of a home declined 7% yr over yr on Maui.

Posted by: guest at February 4, 2008 5:29 PM

the median price of a home on maui is more than the median price of a home in new york city.

what was your point?

Posted by: guest at February 4, 2008 5:32 PM

Yes, I do think interest rates will hold relatively steady over the next 10 years...and HOPEFULLY go up a bit. But they were in the TEENS in the 80's, 5:29.

And yes, I also expect incomes to rise over the next 10 years.

I guess that's the difference between us. I'm a little more optimistic.

The sure fire way I will be wrong is if we end up with McCain in the White House.

Posted by: guest at February 4, 2008 5:34 PM

Actually 5:24 unless you can back up the rationale that housing will continue to appreciate with some sort of economic trends that would support higher prices - (and I am not saying they don't exist) - simply asserting that housing will appreciate in the future simply because it appreciated in the past is the ultimate in speculation/day-trading/market timing

The fact that you cannot see this - is EXACTLY why we are in the mess we are in now. No one is saying that renting is 'better' then buying - what is being said is that (on an accounting basis) it DEPENDS.

Posted by: guest at February 4, 2008 5:34 PM

5:25 - there will be a response that people who bought in the 80's or early 90's had some time of negative equity.

However, if they were not flippers and lived in the properties for a few years these people made incredible money.

If they owned for 7-10 years they made hundreds of thousands.

Anyone who says that they can save money, and in turn invest that money in the stock market making more money than a RE investor is a fool.

Posted by: guest at February 4, 2008 5:35 PM

Renting is not an investment. But the money you save by renting -- in many BK neighborhoods, close to 50% -- can be invested.

And investments, especially highly leveraged ones, can go down, not just up. Invest your downpayment, and if prices drop 10%, you've lost half your money. You can probably do better than that elsewhere.

Even three or four years ago, buying was comparable to renting if you ignored capital appreciation. Not now.

Posted by: guest at February 4, 2008 5:38 PM

5:20 - 4% is a bit aggressive for an after tax risk free rate (maybe 2.75% - 3%, with rates on their way down I might add). You're right real estate taxes are likely abated here and after tax, essentially negligible (although I haven't looked up the actual listing to tell). Repairs and maintenance should be negligible (if something like plumbing, pipes, heating, would be borne by the condo/coop board). In most rentals, the renter pays electricity, gas and in most condos/coops (at least in mine) water/sewer is included in maintenance so utility charges should not differ. As for closing costs on the sale, true not factored in; but I was just figuring the costs to move in and live in a home by buying vs renting.

I also haven't included the 7.5%-10% increase in rent next year and the year thereafter, and thereafter, etc.

My point here is that the costs are very similar and when you figure in the fact that each month you increase your equity, buying probably comes out ahead.

Posted by: guest at February 4, 2008 5:40 PM

You cite Hawaii as example of why housing in NYC will appreciate (i.e scarcity)

Currently (and in earlier periods) Hawaian Real estate has declined significantly in value (after Japans bubble popped for example) despite "scarcity".

If you buy at the high and sell at the low - scarcity will be irrelevant (see Gold prices for example), scarcity is just one factor (albeit a potentially important one) -

Posted by: guest at February 4, 2008 5:40 PM

Rent is not an investment. Neither is mortgage interest. The investment is the downpayment and principal, if you buy, and the money you don't put into downpayment and principal if you rent.

In a rising market, it is hard for retail investors to beat real estate. The leverage means that if the property goes up 5%, your investment makes 25%.

In a falling market, it works the other way around. 20% drop next year and you've lost all your equity. The stock market isn't going to zero next year.

Posted by: guest at February 4, 2008 5:42 PM

Oh come on, 5:38....

We ALL know that renters, by and large in this city DO NOT SAVE.

Maybe you do, but the very nature of the NYC renter, probably means they spend every dime. That's why they are renting in the first place.

Because I guarantee you, if you took a poll you will find that MOST people in NYC don't own because they have NOT SAVED for the down payment.

Not because they think it's financially better to rent, as so many on here claim.

If it's so much better to rent because you get to save SO MUCH MONEY, then why the hell does everyone I meet say..."I wish I could buy something, but I've got no money for the downpayment!!!!"

Get real.

Posted by: guest at February 4, 2008 5:43 PM

Simple facts:

MOST renters in NYC live paycheck to paycheck and have little savings.

MOST owners in NYC are more financially stable and have savings.

Believe that?

You should.

Posted by: guest at February 4, 2008 5:47 PM

5:35 - you going to fit in that 1br apartment TEN years from now????

Plenty of people couldn't and they had to move and then (if they could) rented out their small apartments at a LOSS for years (1991-95) or they sold for a LOSS and just moved on. Just because someone isnt a "flipper" doesnt mean they can stay in their PRIMARY (non-investment) property indefinetly . Which is why Benson is correct- it can be a VERY big mistake to view your primary residence as an investment first - it is a place to live 1st and an investment 2nd.

Posted by: guest at February 4, 2008 5:47 PM

Most people who are owners here DON'T view their home as an investment first.

It's the renters and negative nancys that try to spin it that way, 5:47.

Posted by: guest at February 4, 2008 5:51 PM

But 5:43 you are comparing apples to oranges...

The fact that most people don't save is IRRELEVANT to the question of which costs more renting or owning.

We are discussing FINANCE not psychology. - what "most" people do does not change the (non subjective) 'numbers'

Posted by: guest at February 4, 2008 5:52 PM

I love how you all eat right out of the New York Times' hand.

Every one of you believes whatever it prints.

It could say tomorrow that new figures were released that Brooklyn real estate went up 100% in the first month of 2008 and you'd all be whistling a different tune.

Although there would still be the hum in the background of the sourpusses who say the world is coming to an end...

Can you all try to form an opinion of your own please?

All you do is take this schlock and form it as fact in your brain. Make your own decision about the market. You probably know just as much as these so called "experts"

Were they predicting snow today?

Nope. Not a flake.

Get my point?

Posted by: guest at February 4, 2008 5:54 PM

FACT = every person who bought a home in the last 18mo that has subsequently declined in value would have been better off renting.

Posted by: guest at February 4, 2008 5:55 PM

5:55...you are dead wrong. I'm sorry for those who have already heard this before, but I bought my studio for 250K in November 2006 and sold in December 2007 for 339K.

That's a fact.

Can you please tell me how I could have made 89 thousand dollars in those 13 months renting besides turning it into a brothel?

Posted by: guest at February 4, 2008 5:57 PM

Rent, own, who cares? As long as you don't get married!

Crazy Man Lady

Posted by: guest at February 4, 2008 5:57 PM

Yes - 5:54 your point is exactly the same as mine - no one knows what is going to happen - and under some (unknowable) circumstances it is financially advantageous to own and under some (unknowable) circumstances it is better to rent.

Over the last 15 years in NYC hindsight PROVES beyond any doubt it was better to own. The problem is that no one knows what the next 15 years will bring and THEREFORE there is no CORRECT answer to this debate.

Posted by: guest at February 4, 2008 5:59 PM

5:57 please work on your reading comprehension - your apartment did not "subsequently decline in value"

Posted by: guest at February 4, 2008 6:00 PM

5:55 - ah most properties if not all have increased in value over the last 18 months.

I bet there are loads of people on this board who have bought and sold in that time period and made money. You are a fool.

Posted by: guest at February 4, 2008 6:01 PM

No, there is no correct answer, 5:59. I agree with you on that.

But since we all need a home to live in anyway, I'd rather take my chances on ownership, since above all else (numbers) it just feels GREAT.

To me, anyway.

And who knows...maybe all these great years living in the place I love will turn out to be a financial windfall for me. Maybe not.

Either way, it's a great roof over my head, where I can do as I please and know that I have some control over where I live in this crazy, crazy city we all call home.

It's a nice feeling.

Posted by: guest at February 4, 2008 6:03 PM

Oh and 5:57 you didnt make 89K either - didnt you pay taxes? a Brokerage commission, closing costs, interest, etc....

- just saying

Posted by: guest at February 4, 2008 6:03 PM

If real estate is such a bad investment now and will be for a while - why are all you losers on a real estate web site?

why aren't you on a bond website, or a stock board?

You are on a real estate website because you wish you owned. You are on a real estate website because you espire to buy.

You are naysaying because you know you blew it and didnt buy previously but that is getting you no where.

Add value to this real estate web site or go somewhere else.

Renting is not real estate.

Posted by: guest at February 4, 2008 6:04 PM

6:01 - outside of NYC - virtually EVERYTHING has declined over the last 18mo

Posted by: guest at February 4, 2008 6:05 PM

I sold my place FSBO so there were very little outside expenses, 6:03.

Either way, I'm quite happy.

For someone on my modest salary, I did quite well.

Posted by: guest at February 4, 2008 6:06 PM

Last I checked, 99% of those on this board live in NYC, 6:05.

So your post is ignorant, at best.

Posted by: guest at February 4, 2008 6:07 PM

6:03 - and those are EXCELLENT reasons to own which is presumably (one) of the resons why owning was the correct choice FOR YOU.

Actually 6:04 - this website is hardly one about or geared toward RE investing - it is a community BB with a leaning toward RE.

Posted by: guest at February 4, 2008 6:08 PM

i do not think that you can get the same apartment renting as buying.

i have a 2000 sq ft condo with a backyard with absolutely everything.

with our tax break, we are paying about $3200 for it a month.

also, we decorated, did built-ins, etc.. to make it amazing which we are enjoying, so even if i could find the same space as a rental, i would never invest in it, so our day to day lives wouldn't be as nice.

fyi - i bought in late 2006, and know for sure that it's gone up because others in the building have sold for a really nice profit.

Posted by: guest at February 4, 2008 6:12 PM

No 6:07 no ignorant at all - NYC is not immune from the economic forces at work across the country and every single argument you are making about the "no-brainer" of investing in RE was made in all the markets that have subsequently declined.

The point is....that IF RE declines in value (which it can) it is NOT better to own - obviously you believe that RE does not decline over any timeframe - because if you acknowledged that under some timeframes RE CAN decline, then you'd have to acknowledge that under some circumstances - owning can be a losing proposition.

Posted by: guest at February 4, 2008 6:15 PM

This is a pointless argument - there is no correct answer!

Posted by: guest at February 4, 2008 6:18 PM

5:02- your not a moron if you win!

Posted by: guest at February 4, 2008 6:23 PM

If anyone took the time to read the NY Times article, you'll notice that the headline is totally misleading.
In the 5th paragraph the reporter state that rents in NYC are dipping - NOT sale prices.
The article then piles-on a bushel of apples-and-oranges anecdotes about sales in the suburbs & rest of the US. Declining rents may be a bellwether about potential price declines, but that's all they are -an indicator.
What the article lacks is a single hard number to back up its headline claim - that sale prices are in-fact dipping in the city.
It never ceases to amaze me that the Times does such shoddy reporting on a topic so many New Yorkers love to discuss!
Finally, kudos to the commenter who pointed out that interest rates in the late 80's were several times higher than we see today. That, plus the crime & financial instability of the city stemming back to the 70's made NYC a far different place in which to live - and yes, invest. I doubt that most 'brownstoners' here would be living in Brooklyn if we had to share the F train with The Warriors... when crime, poor city services & high interest rates make their return, then it'll be time to run. But until then, a correction in prices will be just that - a correction. A crash doesn't seem likely looking at the demographic trends of NYC vs the rest of the country.
-Ed

Posted by: guest at February 4, 2008 6:24 PM

You are some dead mother fuckers! This shit is about to go boom. Sad...

The What

Someday this war is gonna end....

Posted by: guest at February 4, 2008 7:35 PM

At least Park Slope real estate is still appreciating.

That's all I care about.

Posted by: guest at February 4, 2008 8:35 PM

If only that were the real What. But it's not, alas.

Some day this whore is gonna spend...

Posted by: guest at February 4, 2008 8:58 PM

I think The What is in the same bunker as OBL out Pakistan way... all we'll get now is the occasional audio tape. Memorex.

Posted by: guest at February 4, 2008 9:32 PM

"If only that were the real What. But it's not, alas.

Some day this whore is gonna spend..."

Ha! I can't catch a brake. You will hear from me real soon. I have some things to deal with. Remember Charlie Chaplain, he entered a look--a-like contest. He came in third! Watch out for WAMU, they are insolvent.

The What

Someday this war is gonna end...

Note to Brownnstoner (Jonathan) Your Brownstone comps are at 995K. A property closed not far from you for that price. I know you paid 9655K in 2004. I could've got you something for 750 around the way at that time. ( You thought I don't know Huh!) LMMFAO!!!!!!!

Posted by: guest at February 4, 2008 9:47 PM

"I bet you none of the Forbes Richest People are renters."

I bet none of the Forbes Richest People are blogging owners drawn to threads that make them worry about the value of their homes.

Posted by: guest at February 5, 2008 12:35 AM

The What! Your back! Ahhhhhh yeeeeahhhh, let's get it crackin' up in here!

Posted by: guest at February 5, 2008 12:38 AM

"The What! Your back! Ahhhhhh yeeeeahhhh, let's get it crackin' up in here!"

Chill. I have some important things to take care of. I will be back!

The What

Someday this war is gonna end.....

Posted by: guest at February 5, 2008 1:16 AM

SO BENSON:

After your vitriolic condemnations of all things government subsidized (a recurrent feature of Brownstoner), it turns out you "started in life" at the Red Hook Houses, among the country's first PUBLIC housing projects.

Good enough for you to benefit from public support, but not anybody else.

Please make your refund check made payable to the American taxpayer now.

Thank you.

Posted by: guest at February 5, 2008 2:20 AM

Told you The What was in Pakistan. "Important things!"

Posted by: guest at February 5, 2008 9:32 AM