Condo of the Day: 535 Dean Street Penthouse Price Cut

This has nothing to do with AY - it has to do with the fact you cant get a mortgage.

Believe it or not AY isnt everything

Posted by: guest at March 19, 2008 12:51 PM

I'm a childless buyer and I could be diggin' the open space and views if I didn't think that future tenants of Atlantic Yards will be looking down into my view-less patio.

Posted by: guest at March 19, 2008 12:51 PM

Why the price cut? Because prices are way out of whack -- still. This may be getting closer to rationally price, but it might still have further down to go before it sells.

Posted by: guest at March 19, 2008 12:51 PM

"open views"? maybe, but only for a few more months, no?

Posted by: guest at March 19, 2008 12:57 PM

As a giant 1 bedroom, this place would rent for about $3000 a month. With a $700 per month maintenance, your mortgage interest (after tax benefits) shouldn't be more than $2300 per month. That works out to about a real sale price for this place of $600,000, with 10% down (and not counting the cost of the down payment).

It shouldn't be more than $600,000.

Posted by: guest at March 19, 2008 12:59 PM

I think this would rent for $3500.

Posted by: guest at March 19, 2008 1:02 PM

rents are going to increase over the next couple years.

Posted by: guest at March 19, 2008 1:05 PM

Where's the 1/2 a bedroom? Do they really mean the little closet by the bathroom? Seriously? Man.

Posted by: guest at March 19, 2008 1:07 PM

Price cut, price cut. That's all you hear nowadays. No bottom in sight.

Posted by: guest at March 19, 2008 1:08 PM

1:05:

You think a 1400 square foot penthouse in Manhattan rents for $3500? Are you INSANE??

Try $5500-7500. And up.

Posted by: guest at March 19, 2008 1:08 PM

You will see rents fall over the next few years when all the condos in Brooklyn (on 4th ave and on Flatbush) fail to sell and go rental. There will be a rental glut and rents will fall.

Posted by: guest at March 19, 2008 1:09 PM

you people are a little out of the loop on manhattan rents.

Posted by: guest at March 19, 2008 1:10 PM

"You will see rents fall over the next few years when all the condos in Brooklyn (on 4th ave and on Flatbush) fail to sell and go rental. There will be a rental glut and rents will fall."

HIGHLY doubtful.

When's the last time your landlord lowered your rent?

Posted by: guest at March 19, 2008 1:11 PM

A rent of $3000 equals a rough equivalent of a purchase price of $600K (with a maintenance of $700 per month, after tax benefits on the mortgage interest)

For every $500 per month more that you think it would rent for, add about $100K more to the purchase price.

So, if you think it would rent for $3500 a month, then figure the correct price is about $700,000.

If you think it would rent for $4000 a month, then it is now properly priced at $800,000.

I think it is still overpriced.

Posted by: guest at March 19, 2008 1:14 PM

1:11 - Landlords lower rents all of the time for EMPTY apartments. Of course they don't lower rents for existing tenants since they know it will cost you to move. But with every bank in NY in a hiring freeze, the chance of rents on 1 bedrooms in luxury buildings going up significantly over the next year or so is nil. More likely that rental prices will fall, especially in the big managed buildings where turnover is high.

So, to sum up, this place is still priced more than $100k too high.

Posted by: guest at March 19, 2008 1:16 PM

"There will be a rental glut"

The vacancy rate is less than 1% in nyc.

It will take a helluva lot more than a few condos (most of which are already half sold) to create a rental glut as you say.

Argyle is already 70% sold, Novo is almost 50% and I believe Crest is over 70%.

That leaves maybe 150 condos that might go rental.

Is that a glut in a borough of 2.4 million?

Posted by: guest at March 19, 2008 1:16 PM

Rents fall? Yeah right. Prices are so high rent wont need to fall. They might go up a little more slowly (for a very short while), but since people will be buying at depressed rates, excess rental capacity will get taken up fairly quickly.

Posted by: guest at March 19, 2008 1:17 PM

Fails to sell...cause it's an ugly building in a not so nice location.

What is that on with the soffits in the kiving space, that is just ugly.

Posted by: guest at March 19, 2008 1:17 PM

If all these people are no longer buying homes as they have been for the last 8 years, won't they be renting instead?

Seems to be that there will be the complete opposite of a rental glut coming up.

You gotta live somewhere. You either own or you rent.

Since you all seem to say no one is buying anymore, what else are they doing???

Posted by: guest at March 19, 2008 1:19 PM

At lease renewal this year, I negotiated the rent on my smallish Brooklyn Heights two bedroom down to $2600 from $2700 (he had proposed renewal at $2750). My rent was already low since I've been in the place for two years. I pay my rent on time so he likes me well enough, but after we signed he said that a number of his other apartments in BH/CH/CG were sitting unrented for longer than he was comfortable with. I should have pushed harder.

Posted by: guest at March 19, 2008 1:22 PM

People will rent as a hedge against a bloated residential property market. When owners rediscover the meanings of future value or opportunity cost, then property prices will come down, people will buy, and maybe rents will drop a little.

Posted by: guest at March 19, 2008 1:25 PM

or rents will go up to make up for the inflated housing prices.

that is what the government is hoping for.

Posted by: guest at March 19, 2008 1:28 PM

1:19 - "no one" (or more accurately, fewer people) is/are buying anymore, so they are either 1) staying put or 2) leaving NY. Hesitant buyers don't automatically become eager renters you idiot.

There will be downward pressure on rental prices, especially luxury 1 bedrooms, because the financial sector/law firms are no longer hiring anything close to the same number of the young professional types who live in these places. Watch rental prices in in late summer early fall and you'll see. This will probably be be less of an issue way out in Prospect Heights that it is in Manhattan though.

Posted by: guest at March 19, 2008 1:29 PM

I'll tell you what, overpriced or not, not a family-friendly apartment, whatever. I was going to look at another unit in this building and turned around when I got half a block away as the neighborhood was shady shady shady. I'm not having my girlfriend walking down Dean street at night on her way over any time soon. Maybe I just got a bad impression, but this felt way too edgy for my tastes.

Posted by: guest at March 19, 2008 1:31 PM

Its also possible that landlords may have increased rents more than they should have, based on high home prices and consumer's increasing use of credit to pay basic expenses. If that's true, then yes rents might also come down as people move to cheaper, more affordable neighborhoods.

It also would mean that the economy is much MUCH more screwed than economists/pundits are currently projecting, and that the decline in housing is going to burn a hole in the floor!

crap

Posted by: guest at March 19, 2008 1:32 PM

I'm with 1:09. Rents are going up because the "side lines" are crowding. Sponsors/sellers will temporarily try to "hold on" by renting out. Rental market gets saturated. Rents drop to levels too low to offset carnivorous holding costs. Desperate sponsors/sellers cut their losses by dumping holdings back onto the sales market. Rents fully recover after recession. Sale prices recover only to 2000 levels.

Posted by: guest at March 19, 2008 1:35 PM

Ugly building? Check.

Bad location? Check.

Overpriced? Check.

Posted by: guest at March 19, 2008 1:44 PM

keep dreaming renters!!!

i'm raising the rent every year!

Posted by: guest at March 19, 2008 1:47 PM

Agreed with 1:35. Sounds pretty reasonable, though painful if true. The recover to 2000 part is too low though. The last housing boom should have ended around then, based on historical cycles. I think '01 - '02 prices are more reasonable.

Posted by: guest at March 19, 2008 1:51 PM

I think in NYC, we will just stay flat for a long while (maybe 3 years).

There will be no 2000 or 02 prices here again.

Seriously people. Wake the eff up.

Posted by: guest at March 19, 2008 1:59 PM

"There will be no 2000 or 02 prices here again."

I think there will.

So there.

Hah!

Posted by: guest at March 19, 2008 2:10 PM

12:59 - you can't equate monthly payments to rent with those on a mortgage quite like that. For that $3000/month you pay to rent, its gone. For that $3000/month mortgage payment, every month you're repaying about $400 of principal, hence increasing your home equity. At the end of 5 years, your left with nothing as a rental; as an owner you've accreted $25K

Posted by: guest at March 19, 2008 2:18 PM

I bought my Brownstone in 2000 in Prime North Slope for under a million.

If you think those prices are coming again you are seriously dellusional.

Two on my block have sold for over 3 million this year. One for 3.4 million.

Think about how much of a percentage drop that is and get back to me.

Posted by: guest at March 19, 2008 2:20 PM

2:18, but on the $60K that you put down as a down payment, over 5 years you're likely to make around $30K in investment income, so it's a wash at best. If you put down more than 10%, then the economics tip even more toward renting.

Posted by: guest at March 19, 2008 2:21 PM

"I bought my Brownstone in 2000 in Prime North Slope for under a million."

Goody for you. You'll probably keep most of your value. Elsewhere not so much.

Posted by: guest at March 19, 2008 2:22 PM

2:21...

I would love to know how many renters out there in NYC have turned a 30K profit on 60K.

I don't know many renters who have more than about 500 bucks in their bank account.

You people who talk about this amazing renting savers are talking about 2% of the population.

Most renters save NOTHING.

If they did, they would have used it for a downpayment when houses were cheap 8 years ago.

Talking about a theory of investment and then what actual people do are two TOTALLY different things.

People don't save. Period. The U.S. has a negative savings rate and 75% of the population has less then 10K saved for retirement.

So you can say all you want that someone could have made more had they invested that money, but the fact is THEY AREN'T!

Becoming a homeowner has forced me to save because it puts me on a 30 years schedule for the same payments every month. I save for a rainy day, I save for maintence costs, I save for a trade-up, etc. I now have WAY more money saved now than I ever did as a renter and I believe a lot of people are like that.

I look at my renter friends, and most of them have 40K in credit card debt and use their overdraft on their checking account like it's nothing.

Posted by: guest at March 19, 2008 2:26 PM

There's no reason to expect prices to come back to 2000 levels, since there's surely been some small improvement in fundamentals (European buying, neighborhoods like Clinton Hill and Prospect Heights being much better to live in these days), etc.), and in any case in ordinary times you'd expect house prices to rise about 3-4% a year (not adjusted for inflation, though). That suggests a house you bought in an improving neighborhood in 2000 for $1 million would be worth $2.1 million at the end of 2008 -- that's a 10% compounded annual increase.

That also means that housing prices have 30-35% declines ahead of them. That could happen all at once, but much more likely is that prices will stay relatively flat for five-ten years, with inflation eating away all the gains.

Yet another reason not to buy at these prices.

Posted by: guest at March 19, 2008 2:30 PM

i saw this place, it's got a bizarre layout with a freakishly small bedroom, that's why.

Posted by: guest at March 19, 2008 2:33 PM

Better than throwing 100% of your money down the drain to your landlord.

Posted by: guest at March 19, 2008 2:33 PM

2:26 - Get better friends.

Posted by: guest at March 19, 2008 2:35 PM

2:26, that's nonsense, at least when it comes to New York City. There are tens of thousands of very well-off people in New York who rent, and who instead of putting the money toward the mortgage put it toward their 401(K) or their investment accounts.

Regardless, you're missing the point. Whoever we're talking about has to have the $60K to start, because that's the down payment. The $30K isn't extra money that's saved, it's what you get if, instead of putting $60K down on a co-op, you invest it. (A $30K return after five years on a $60K investment is not some great return -- it's around 8% compounded, much less than the historical return on stocks, for instance.) You were arguing that you get $25K at the end of the five years because you're building equity instead of paying rent. But you simply forgot about the down payment.

You also, of course, forgot about closing costs, which eat up another five per cent or so of your investment, but we'll let that slide.

As for the forced savings idea, for the most part it's become nonsense, because of the advent of home-equity loans. Plenty of people aren't building equity in their homes -- they're taking it out along the way and spending it.

Posted by: guest at March 19, 2008 2:37 PM

2:35...hate to break it to you, but the reason we are in this economic mess is because MOST of this country lives off credit.

you need to wake up and not be such a smartass.

Posted by: guest at March 19, 2008 2:37 PM

year 2000 prices? Yea ok and I guess our metrocard will be lowered as well.

Those who hesitate.. masterbait all day on brownstoner.

Posted by: guest at March 19, 2008 2:42 PM

"You were arguing that you get $25K at the end of the five years because you're building equity instead of paying rent. But you simply forgot about the down payment."

I was not the person arguing that, but I think you are a little dellusional about how many renters in NYC save any money at all.

I know people who make great money (200K per year) and are spending 4000 a month on a rental, 200 a month on their blackberry service, 500 a month on drinking, 1000 a month on food. Putting in a couple bucks every month into your 401K isn't really doing jack shit these days.

You are being blindsided by a few wealthy people you know.

The reason why so many renters are bitter these days is because they know that had they not swindled all their money on those $400 prade shoes, they could have had the 50K necessary to buy a 1 bedroom 5 years ago.

Why else would so many of them express such anger on this website for those of us who did do that?

Posted by: guest at March 19, 2008 2:44 PM

Who would have thought that this financial crisis would have brought on these dull, repetitive rent vs. buy debates on every thread.

Posted by: guest at March 19, 2008 2:45 PM

What do you call "buying" a house by borrowing 80% of the purchase price? You don't think that's "living off credit"?

Before inveighing against renters who have a little credit card debt, you might want to look at the millions of homeowners who took out mortgages they couldn't afford because they were convinced, like you, that buying a house was the best investment they could make. They're now stuck with hundreds of thousands in debt they'll never be able to pay back, and they're either slaves to their house or their credit records are wrecked.

Posted by: guest at March 19, 2008 2:48 PM

2:45 maybe because a good number of renters here believed thier landlords were going to quickly offer them the house. sike!

Posted by: guest at March 19, 2008 2:52 PM

I don't at all think my house is the best investment I will make. That's why I told you I save a ton of money. I also contribute the maximum every year to my IRA and occasionally buy a few stocks.

My point was only to assuage the notion that all these brilliant renters who didn't buy are sitting on a matress full of cash is a bit absurd.

And totally untrue.

And yes...my 20% downpayment in on my million dollar place is 190K more in assets than about 75% of this country.

Posted by: guest at March 19, 2008 2:52 PM

Brownstoner are you on crack? This is a one bedroom in a very mediocre location - $799,000 is still DRASTICALLY overpriced.

Posted by: guest at March 19, 2008 2:58 PM

2:52 Dont waste a your time. Some people just cant shake the Serf mentality from thier system. It's all genetics.

Posted by: guest at March 19, 2008 2:59 PM

You've got pretty pathetic friends 2:26

Yeah I'm a pitiful renter, but I have ZERO debt and certainly more than $500 in the bank. Why, because I live within my means - including moving to a 'fringe' area when rents went up.

Kinda sucks though that for the first time in my life I'm in a position to buy and its not even worth thinking about. I'll continue to rent, save my money, enjoy my bigger space and think about buying a a couple of years when the stink has come off the bubble.

Posted by: guest at March 19, 2008 2:59 PM

Atlantic Yards Effect? But, but, I thought that DDDB was going to prevail in court! Why, just recently these boards reported how Daniel Goldstein and Candace Carponter were "confident" that the Supreme Court would accept their appeal and save Brooklyn from the eeeeeeevil Rat. Shame on you people for doubting their sage prediction. After all, they have a long, long history of being correct on these things. Really.

Posted by: guest at March 19, 2008 3:02 PM

Why are you talking about 75% of the country? This is New York City. We have very little in common with the rest of the country. And there are tens of thousands -- actually, probably more than that --
of renters here who are sitting on mattresses full of cash. I'm one of them. I made my money too late to buy in the early part of this decade, and have preferred to save my money rather than spend it on overpriced properties -- which Brooklyn homes have been since 2005 at the latest.

Your picture of renters is absurd. Like one of the earlier posters said, get some new friends.

Posted by: guest at March 19, 2008 3:07 PM

hey 2:26 speak for yourself

i rent and i save religiously unfortunately i started sving around 2002 and have saved a large amount of cash but still cannot afford one of these overpriced places

when it makes sense i will buy adnd right now it makes sense to rent for me

$500 in the bank? lmao you are missinformed

Posted by: guest at March 19, 2008 3:08 PM

"Why are you talking about 75% of the country? This is New York City. We have very little in common with the rest of the country."

AHA!!!!!

So everyone says that New York City is just like the rest of the country until it's time to support your point! How interesting...

So perhaps if NYC is so different from the rest of the country, prices here will continue to climb.

Just like they do in London, Paris, Tokyo, Syndey, Dubai and Zurich.

Posted by: guest at March 19, 2008 3:12 PM

You know what is real nice now? Some people are attacking the fucking asshats! Now you see this shit unfolding in real time (Bear Sterns). BTW This shit isn't over by a long shot. More layoffs, more write-downs, more bank implosions and more price reductions.

The What is laughing his ass off now, I told you 2008 was going to be a fuck you year! I'm glad some people are seeing the light and keep renting! Let the the bullshit crash!

Hey Brownie, this blog is getting real shity. What the matter? No more overpriced shit selling? No one is making Mortgages on this shit!

RIP Mutant Real Estate Bubble.

The What (Lodi NJ Reping my hood LMMFAO)

Someday this war is gonna end....

Posted by: guest at March 19, 2008 3:13 PM

Look - 2:26 and the rest need to realize that the NYC "renting and saving" population includes a lot of people who, like me, came to NY post 2000, began their carrers, and have been steadily saving ever since. Now we are ready or nearly ready to buy (20% down for a co-op is a lot of money after all), but prices have gone up so much in the interim that most of us are wondering "why bother?"

The RE market has nowhere to go but down, and we've all learned ways to put our down payment money to work. Moreover, most of us are in rentals that are adequate (but better than anything I can reasonablya fford to buy) and relatively cheap, certainly cheaper than the sunk costs of mortgage interest, maintenance, and taxes. I put almost 30% of my take-home in savings, so my personal wealth just keeps growing. But no matter how much cash on hand I have, I'm not buying some over-priced shithole just for the privilege of thumping my chest as an "owner" on Brownstoner.com. Buying an apartments has to be a smart financial decision, and right now buying in NYC simply is NOT.

Posted by: guest at March 19, 2008 3:14 PM

Keep saving renters. You will always have an excuse why you didn't buy.

Oh..."i saved all my money starting in 2002"

PLEASE. Such a load of shit.

You are all just hanging onto straws because you just missed the largest run up in housing prices we've ever seen. Anyone in this city who bought prior to 2000 is set.
Bust or not.

Posted by: guest at March 19, 2008 3:15 PM

"I told you 2008 was going to be a fuck you year!"

Nope. Actually you said 2007 was.

Posted by: guest at March 19, 2008 3:16 PM

3:14....

then people like you will probably not make it in nyc long term.

some of us would like to.

i don't plan to be sitting in my 10K a month 1 bedroom rental in 10 years.

new york is not meant for everyone. a lot of you will be weeded out. just like always.

survival of the fittest.

Posted by: guest at March 19, 2008 3:19 PM

"And since most buyers started out as renters, clearly renters ARE saving."

I believe most New York City buyers received help from parents for their downpayment.

My building is mostly 20 somethings and this is an owner occupied building.

I don't know too many 28 year olds workin in non profit or the arts who have worked long enough to afford the 50K downpayment neccessary to have bought a place here.

Posted by: guest at March 19, 2008 3:22 PM

Yep like they say if you can make it NY you can make it anywhere.

Posted by: guest at March 19, 2008 3:24 PM

What happens to a renter when his landlord is forclosed upon?

Posted by: guest at March 19, 2008 3:25 PM

3:15 - you arrogant ass - as I said, I could not afford a down payment to buy in 2002. I can now, but choose not to. But if I had bought back then, I would be worrying about whether all of my gains since were about to evaporate, not insulting people for having the courage to advise caution in purchasing real estate.

Just FYI douchebag - you are stuck with a an illiquid asset whose value is going to be declining steadily (if not plunging) for the foreseeable future. When you are ready to sell, I'll be the one submitting lowball bids at your open house.

Posted by: guest at March 19, 2008 3:26 PM

"Just FYI douchebag - you are stuck with a an illiquid asset whose value is going to be declining steadily (if not plunging) for the foreseeable future. When you are ready to sell, I'll be the one submitting lowball bids at your open house."

Um...in the past 8 years, my home has appreciated approximately 350%.

Is that how much of a drop they are predicting?

If so, then yeah...I'M SCREWED!!!

Posted by: guest at March 19, 2008 3:30 PM

"not insulting people for having the courage to advise caution in purchasing real estate."

You mean kinda how you just insulted me FOR buying something.

A wee bit hypocritical, no?

Posted by: guest at March 19, 2008 3:32 PM

No, I insulted you for being an asshole, not being a buyer of real estate. I do plan on being one of those myself someday. When I choose to do so is my business, but you will always be a douchebag.

Posted by: guest at March 19, 2008 3:34 PM

Lets be real the longer it takes you the save, the deeper in Bklyn you will end up. Then you'll forever moan and complain about PS prices and how silly they are.

Posted by: guest at March 19, 2008 3:34 PM

"Lets be real the longer it takes you the save, the deeper in Bklyn you will end up. Then you'll forever moan and complain about PS prices and how silly they are."

Wisest statement of the day.

By the time you've save that 50K downpayment, you'll need 100K to get in on a neighborhood you want.

So buy something smaller and sacrifice or stop your bitchin.

Posted by: guest at March 19, 2008 3:38 PM

3:34 - wrong. I can save faster than apartment prices can go up, even in good years. And 2008 is not a good year. For me, buying the size place I need right now means buying in Fort Greene or Prospect Heights. Buying next year means buying in Prime Park Slope or Brooklyn Heights with a bigger down payment and for a lower purchase price.

Posted by: guest at March 19, 2008 3:38 PM

Same situation as 3:26 here, graduated in 2003 and have managed to save a good chunk for downpayment. My sentiment is that there is no reason why I will rush in now to purchase a home. I wouldnt' say the RE market has nowhere to go but down for sure but I think we can all agree the RE market is flattening off.

You can argue that Manhattan apt prices may retain some momentum but can you say the same about Brooklyn?

Posted by: guest at March 19, 2008 3:44 PM

Apartment and housing prices are not going up, not this year, not next, and not for the year after that. Just as they did after 1987, housing prices are going to fall or stay flat for four or five years. So if you have enough money for a down payment for an apartment now, and you invest it, you'll have the down payment for a much better apartment five years from now.

And as for Mr. 350%, I'm so happy for you. Your experience has absolutely nothing to do with what we're talking about on this board, which is whether it makes sense to buy today, after prices have already gone up 350% in the last seven years. What kind of idiot thinks that makes sense as an investment strategy?

Posted by: guest at March 19, 2008 3:45 PM

Brooklyn is becoming MORE desirable in some senses than Manhattan 3:44.

If Manhattan prices are already higher, wouldn't logical thinking say they can't go higher, but Brooklyn still has room for growth??

Posted by: guest at March 19, 2008 3:46 PM

Most people said in 2001, prices were about to tank.

Thank god I didn't listen.

I do not believe NYC will tank in any way.

As someone else said, this is not the rest of the country.

Burbs are losing jobs, NYC is creating more.

Posted by: guest at March 19, 2008 3:48 PM

agree, 3:48. after 9/11 everyone said new yorkers were all going to leave the city in droves.

not only has the population increased 250K since then, but housing prices doubled as new york city took the place as the greatest city in the world.

Posted by: guest at March 19, 2008 3:56 PM

3:46: if a place is more desireable to live in than another, the prices would reflect that. so your second statement clashes with your first one.

Posted by: guest at March 19, 2008 3:56 PM

3:56...

it doesn't clash at all. i said it's becoming.

can you read?

Posted by: guest at March 19, 2008 3:58 PM

I guess I need to go Target and buy myself a crystal ball. Seems like all the cool renters have them.

Posted by: guest at March 19, 2008 3:58 PM

3:56 - keep dreaming.

2001 - an isolated and tragic terrorist event that occured right before a very long period of sustained economic growth driven largely by tax cuts, cheap money, and financial sector.

2008 - a global credit crisis, recession in the US, a financial industry that has only just begun to cut back. No end in sight.

POINT - NYC real estate will not get out of this one unscathed. Do you have any idea how much of the city's recent real estate gains have been driven by bankers and their bonuses? NYC may not tank completely, but no owner is going to see improvement over 2007 comps for a very very long time.

Posted by: guest at March 19, 2008 4:05 PM

" Do you have any idea how much of the city's recent real estate gains have been driven by bankers and their bonuses? "

Yes, I do.

20%.

Posted by: guest at March 19, 2008 4:06 PM

I'm not sure why people are calling a peak in 06/07 when the city records -- and every realtor report -- show they are up in every category.

Posted by: guest at March 19, 2008 4:10 PM

Prices are dropping everywhere in the city. Except perhaps the super-high luxury end in Manhattan, which is a world unto itself.

Posted by: guest at March 19, 2008 4:16 PM

3:48 and the rest of you who think prices are going to keep going up in the next couple of years - what rock do you live under? it is simply astounding.

Posted by: guest at March 19, 2008 4:18 PM

there are no facts to back that up, 4:16.

asking prices may be chopped here and there, but that has nothing to do with the recorded selling prices.

you people are like total real estate virgins.

Posted by: guest at March 19, 2008 4:19 PM

I like this comment:
"perhaps if NYC is so different from the rest of the country, prices here will continue to climb. Just like they do in London, Paris, Tokyo, Syndey, Dubai and Zurich."

Posted by: guest at March 19, 2008 3:12 PM

Dubai = Las Vegas. I hope NYC isn't that bad yet. London is at the end of its own bubble -- it had a nice plunge after the last one. Paris hasn't done anything like what NYC has done, except perhaps in depreciating dollar terms. Zurich - hardly a world class city!

Tokyo -- ah, there's the rub. Bubbled along with NYC in the late 1980s. Dropped to 10% of peak values when the bubble broke, and has behaved reasonable well since then.

If we follow Tokyo, we can look forward to Park Slope priced for professors and Brooklyn Heights for junior lawyers, just like the old days.

Posted by: guest at March 19, 2008 4:42 PM

It costs a million dollars for a 1 bedroom in Tokyo.

About the same for a 1 bedroom in London. 600sf.

And you all are bitching about less than that for a 1400 sf penthouse.

Posted by: guest at March 19, 2008 4:54 PM

4:54 -- absolutely wrong for comparable neighborhoods in London. AY is not Knightsbridge.

Posted by: guest at March 19, 2008 4:59 PM

What does it cost in their local currency? Cost comparisons that don't adjust for the weak dollar are meaningless.

Posted by: guest at March 19, 2008 5:00 PM

2:37 - I was the one that brought up the 25K equity build, and you're right, I didn't figure in closing costs. My only point was that you can't do the rent vs own monthly payment calc like you suggested. First, if you want to figure in the opportunity cost of income on the down payment, you should use an after tax risk free rate (3% at most) which turns into $1800 per annum. There are many other numbers to crunch, including tax break on mortgage interest etc. Again, the point is $3000/month rent can't simply be equated to $3000/month mortgage & maintenance payment

Posted by: guest at March 19, 2008 5:01 PM

What's the debate? Obviously this isn't selling because no one wants to live opposite the biggest building site in NYC for the next 10-15 years.

Sure, AY may not happen. But who'd gonna take that risk?

Next.

Posted by: guest at March 19, 2008 5:01 PM

Real data on rents in Manhattan from TheRealDeal. For those who think that AY is better than Manhattan, here is your baseline:

One-, two-bedroom Manhattan rents down in March
Mar 19, 2008 01:13 PM
March saw a drop in rents one- and two-bedroom apartments in Manhattan, with studio rents remaining about the same compared to February, according to a monthly report from the Real Estate Group. The average rent for a two-bedroom in a non-doorman building fell almost 2 percent to $3,858 per month, from $3,929 per month in February. The average rent for a two-bedroom in a doorman building fell half a percent to $5,265. The average rent for a one-bedroom in a non-doorman building dropped by about 1 percent to $2,792 per month, and the rent for a one-bedroom in a doorman building fell just over half a percent to $3,578. Non-doorman two-bedrooms in Gramercy Park saw the biggest change over the month, down 6.6 percent to $4,602 per month, from $4,925 per month in February. TRD

Posted by: guest at March 19, 2008 5:05 PM

Count me among the renters who is too young to have gotten in during the boom. I graduated in 2002 and moved to New York in 2004. I have only recently saved enough to comfortably afford a purchase and right now there is no reason to even consider it. I will continue to easily save and live in my "nice enough" apartment while the rest of the housing pumpers fail to realize that no potential buyers are going to be jumping on the sinking ship with them.

Posted by: guest at March 19, 2008 5:16 PM

those manhattan rents are astronomical.

keep in mind those are averages. HALF rent for more than those numbers.

2 bedroom doorman for 5200???

what the hell.

you are throwing that much money a month down the toilet to a landlord.

you renters are REAL suckers.

you can buy a whole brownstone in south slope for a mortgage of 10K a month and rent out a floor for 3K a month.

Aburd to spend that kinda money on rent.

Posted by: guest at March 19, 2008 5:17 PM

I agree...once my rent was about to go past 2000 a month...I was like...OH HELLZ TO THE NO. I am not paying that shit to someone else anymore.

Posted by: guest at March 19, 2008 5:19 PM

lol 5:19 my old tenant in PH did the same. When I raised her rent 2000... she didnt renew and purchased in jersey.

Posted by: guest at March 19, 2008 5:28 PM

I don't agree that it's an ugly building, but do agree that that area is somewhat down trodden. I looked at the building prior to construction, and just couldn't commit to the area. At the time I lived on a nicer block in Prospect Hts, and thought that even there wasn't so great.

this layout would work for a single / couple wanting a loft space, but similar spaces exist in williamsburg - the Gretsch has terrific apts just like this - without the upcoming headache of AY. I know a couple of people in that building, and an apartment like this would definitely rent around $3500.

if this owner could re-work to make a 2 bedroom, would probably sell then, or rent for a decent amount.

as a poster noted above, there too many sitting on the sidelines right now too.

Posted by: guest at March 19, 2008 5:34 PM

Could someone explain why paying money called rent to a landlord is "throwing it away" but paying money called interest to a bank is "investment"? They look exactly the same to me.

The difference between renting and owning is elsewhere.

First, if you have a self-amortizing mortgage, you could think of the principal payment as a forced savings plan that forces you to invest in an undiversified asset you are already invested in. That could be useful if you have no other way of saving in a more sensible way, but most people in the income brackets necessary to buy at these prices should have better ways to save/invest.

Second, owners take more of the risk or gain the benefit of future price changes. In a rational environment, owners might expect to be paid a bit for assuming this undiversified risk (i.e., it should be cheaper to buy than rent). But given current prices, it is clear that anyone buying today is PAYING for the privilege of making a risky investment (it is much more expensive to buy). This is the usual sign of a bubble: people have decided that there is no risk and therefore don't demand to be paid for it, which, of course, means that there is a great deal of risk indeed.

Anyone buying today should assume that they would be financially MUCH better off if they rented and saved and waited until rental and purchase prices get more in line. This is not 2001.

Posted by: guest at March 19, 2008 5:36 PM

Jimmy Legs -- Ratner contemplated including the Newswalk Building in the AY plan, but reasoned it would cost too much to buy everyone out (using the threat of eminent domain, as happened with nearly everyone except for the notable examples). For reason, there's an odd bite out of the footprint in the middle -- the whole block was spared his clutches.

For obvious reasons, a lot of people in the Newswalk Building are vocally opposed to the plan.

Posted by: guest at March 19, 2008 5:39 PM

5200/mo rent = under a million purchase price (depending on maintenance, interest rates, opportunity costs, etc). Where can you find a 2 BR Manhattan doorman apartment for under a million?

These rental prices may be silly, but the purchase prices are sillier.

Posted by: guest at March 19, 2008 5:51 PM

this place isnt 1400sqf. Maybe 1100.

Posted by: guest at March 19, 2008 5:55 PM

"Where can you find a 2 BR Manhattan doorman apartment for under a million?"

Anywhere above 110th Street.

Or Murray Hill.

Or East East Village.

Posted by: guest at March 19, 2008 5:57 PM

Ahhhh 8 yrs ago those were the days. Back then I signed up for a fixed 30 yr mtg. Now I have 22 yrs left till my pay off party!!!

Posted by: guest at March 19, 2008 6:17 PM

"Just like they do in London, Paris, Tokyo, Syndey, Dubai and Zurich"

Can't speak about any of the other places (like the other poster already did), but Tokyo is definitely not going up like this person thinks. At the peak of their bubble in the 80s, the imperial grounds in the center of tokyo were worth more than california. corporate workers were moving so far away that they had to take the shinkansen to get to work. tokyo today is still very far below its 80s peak in real terms and often even in nominal terms. today you can buy a small 2 or even 3br house (small by our standards, mid-size by japanese standards) for about $600-800k in tokyo proper. may not be the hippest hood, but it is actually in tokyo. there are apartments in yokohama (maybe the jersey of tokyo?) that sold for $1mn in the 90s even after the boom that are being sold for $350k now. anecdotal, but i have seen it.

Posted by: guest at March 19, 2008 6:27 PM

one thing goes against the renters argument, its called inflation. if i buy a condo for 670 k with 10 percent down figure 600 mortgage
mortgage 3600
cc 700
4300- tax deduction 1000 - equity 400 = 2900 a month. even with my tax deduction slowly going away think 15 years later i will still be paying about 3200 dollars.

if you think this apartment which will rent now for 300o dollars what do you think it will rent for 15 years from now. 4000??? more. renting at the same price of buying is never good if your going to stay even with no appreciation.

Posted by: guest at March 19, 2008 9:34 PM

Over those fifteen years, I will have saved the $500K you've paid the bank in interest, and I will have lived in a much nicer place than the one you've lived in, because until housing prices fall significantly, renting is going to be much cheaper than owning.

The math isn't that complicated -- in Brooklyn, housing prices have skyrocketed since 2001. Rents haven't gone up anywhere near as much. So renting is far cheaper today, relatively speaking, than it was seven years ago. For the same monthly price, you can get a vastly nicer place renting than buying.

Not to mention the fact that this apartment is going to be worth the same ten years from now as it is today.

Posted by: guest at March 19, 2008 10:39 PM

Don't these two realize Sunday March 23 is Easter. I wonder this apartment can't sell. Dumb Jews.

Posted by: guest at March 19, 2008 10:48 PM

if you bought in brownstoneristan in 2000 (as I did) your place tripled to quadrupled in value in the interim.

i fully expect prices to settle by 10, maybe 15% over the next year or two, and probably stay there for a while. But it would take a disaster of monumental proportions to cause NYC real estate to lose much more than that.

Posted by: guest at March 19, 2008 10:49 PM

"i fully expect prices to settle by 10, maybe 15% over the next year or two, and probably stay there for a while. But it would take a disaster of monumental proportions to cause NYC real estate to lose much more than that."

See this is the thinking among the fucking clueless. Asset prices are getting ready to CRASH! The FED has been trying to prevent DEFLATION, Got it!. Thats why shit is so high now (Food, Gas, Rent and Mortgage payments).

Pay attention to Bear Sterns, people are losing their jobs left and fucking right! If people don't have any money or jobs, how can they afford buying your overpriced piece of shit!

A depression is coming! You have to pay for a fucked up war (3 Trillion)! A Mutant Real Estate Bubble (6.5 Trillion)! Plus golden parachutes for the BIG BOYS!

You retards got assraped during the Bush administration! Yep you thought you was rich but, you are in debt. Fuck all of the specuvestors. Oh BTW you see ALL THOSE FUCKING CONDOS around you, they will become future homeless shelters. LMMFAO!!!

The What (I said 2008 is going to be a fuck you year assfuck)

Someday this war is gonna end....

Posted by: guest at March 19, 2008 11:22 PM

question 10:39? how if your paying 3000 a month in rent and i pay 3300 in a mortgage payment which includes 400 a month principle will you save 500K. are you planning on living in the street? again do you expect to be paying the same 3000 a month in rent 10 to 15 years from now. even if you had a rent controlled apartment at 3 percent increases in 10 years your rent would be over 4000 dollars and in 15 over 4500. obviously the math is complicated(at least for you). lets see 60000 dollars down and saving 300 dollars a month equals probably far less then 500k. at 10 percent it would be probably closer to 350k which you have to pay tax on. where are you putting your money to earn this rate at 2 percent in the bank or in a falling stock market. if your going to say that the market goes up then i say real estate always goes up. as it turns neither is true although my house may be about even but im getting killed in the market. for the record on a 600k mortgage in 15 years i will pay 474k in interest less a 142k tax deduction plus gain 174k in principle. meaning i will have really spent 158k over 15 years or 10,500 a year plus lets say 7000 for maintanence a year for a total of 17500 a year while you pay 36000 a year rent again assuming never a rent increase. where are you better off. the numbers don't lie but you do.

Posted by: guest at March 20, 2008 12:40 AM

12:40. you just bitched slapped the hell out of 10:39!!!!

Posted by: guest at March 20, 2008 10:45 AM

That apartment has not sold since its UGLY !
The first floor ceiling is so LOW it feels like a CAVE. The windows are the smallest in the entire building.

Posted by: guest at March 20, 2008 11:14 AM

I just bought in this building and LOVE it!!! Worth every penny! There already is construction going on (my view is on AY) and although I don't work from home, I barely notice it. If you've ever lived in Manhattan, you're used to construction everywhere.

Posted by: guest at March 20, 2008 11:18 AM

if you've ever lived in ANY city, you're used to construction, 11:18.

people on this blog are the biggest bunch of pussies.

Posted by: guest at March 20, 2008 11:26 AM

12:40's post is confusing, but the basic point is correct: IF you pay the same monthly price for renting and buying (after tax interest plus maintenance/taxes), and IF rents and house prices both go up with inflation, owning is a better deal: the leverage guarantees that.

But IF you pay double to own instead of renting, and IF rents go up and house prices go down, then owning is a much worse deal: the leverage guarantees that.

If you are buying as an investment, you have to think that overpriced property is going to go up more. Or that renters will want to buy so badly that they will be willing to pay any price. Or that calling people "pussies" will convince them to buy ugly apartments in bad locations for more than it would cost them to live in a nice apartment in a good location.

Posted by: guest at March 20, 2008 11:50 AM

You can do all the math you want to support renting, and I myself do think it's a good idea for some people if and only if you also save money. Problem is I've only ever observed most renters do not have a substantial savings at all, even when they make a very good income. They have neither equity nor a savings. So how is that financially smart? If you are renting you need to be putting at least 10% of your income in savings every year on top of having an investment portfolio.

Posted by: guest at March 20, 2008 12:44 PM

From today's NY Post about the new US Census bureau's estimates:

"Brooklyn remains the city's most populous borough with 2,528,050 people in 2007, an increase of 5003, or 0.2 percent."

5 thousand more people in Brooklyn in what was considered a slow-growth year hardly promises to make rents lower. Fewer people are buying sure, but then of course that means more renters.

Posted by: guest at March 20, 2008 1:36 PM

Um. $570 per square foot before you figure outdoor space. Beat that anywhere. And then consider that any property around a Frank Gehry building (agree with the aesthetic or not) always gains value. Even if you lose the view, you gain value in proximity. Please show me one building within a block of any of Gehry's buildings that has lost value. Better yet, find out how much each residential property has gained in value when this close. Everyone wins here. Even as a mid-term investment, you really can't really lose.

Posted by: guest at March 20, 2008 10:44 PM