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August 18, 2007
Buying property in BedStuy NOW - am I crazy?
I'm in contract to purchase a 4 story brownstone in Bed Stuy for 899k now. Have gone through a few hurdles w/ the mortgager over the past week (but finally settled on a 6.25 rate on 750k financing). The house is beautiful on a great block, but still needs lots of work. Given current market conditions, am I crazy to buy this property now, or am I making a good move?
Comments
If this is a house that you are going to live in, and work on, and love, in a location you want to live in, then it is a good move, regardless of what the market is doing. You've got a fantastic mortgage rate. Run with it.
Posted by: guest at August 18, 2007 4:02 PM
Sorry, that was me above, Amy. Still having trouble logging in.
Amy
Posted by: guest at August 18, 2007 4:03 PM
I see my home in Victorian Flatbush as just that. A Home. Although, I am "house smart" when it comes to major home improvements some renovation projects were done for the joy that my family and I get out of its use and not how much of the cost I can expect to recoup on a resale. I spent considerably on my kitchen and one bath room which we all enjoy but opted not to have central air installed. We use window units and three portables on the main floor. If you plan on staying put for five years or more, I would say make the house a home that is comfortable for you and your family but keep uneccessary costly renovations to a minimum. Fix what absolutely has to get fixed first.
Posted by: B Square at August 18, 2007 4:24 PM
I'd wait a year or so before buying. I'd guess your house could have been easily purchased for $400,000 less than two years ago.
What goes up can also go down. Most likely your new house will be worth $650,00 this time next year.
But like the previous posters said, if you can afford it and like the house and the neighborhood, it doesn't really matter if you overpay now because in ten years it should have appreciated back to the amount you're paying today.
Posted by: guest at August 18, 2007 7:05 PM
No, you are not crazy to buy in Bedstuy now. All those folks sitting on the fence waiting for the market to crash are going to get stuck buying condos in Bedstuy for $650k in three years. Fort Greene, Clinton Hill & Prospects Heights apt prices are quickly and quietly sliding upward. Unless you've got a rich relative to give you a gift, or you make $250k a year with low debt, you're screwed.
This subprime mortgage implosion needed to happen. If you can't afford a house you shouldn't buy one. This saves a lot more people the heartache of foreclosure.
Pardon the diatribe, in short, if you can afford to buy something with income, buy it now.
Posted by: guest at August 19, 2007 2:46 AM
If you can afford it, do it. I agree with 2:46. We also looked in BedSty and this area is really going to skyrocket. It has already started. For commuting reasons, we chose Crown Heights (4,5 trains). It may seem risky today, but believe me in a few years you will be thankful you did.
Posted by: guest at August 19, 2007 3:21 PM
I bought in Crown Heights North and the rents I can charge keep going up as there is a shortage of housing for young professionals. The market is just going up in brooklyn no matter what is happening in the rest of the country. don't wait, do it. Every empty lot here is selling and being built on. Bed Sty is going to be like Prospect Heights is now in 6 years or less.
Posted by: guest at August 19, 2007 5:19 PM
You got a great rate on a jumbo mortgage, and if you can afford the nut, then it's a great time to buy.
Remember, rising rates may push down prices, but your monthly payments would still be pretty similar.
I'm guessing you put down 20 pct. so you won't be "upside down" as they say if prices drop precipitously.
I'm betting they won't...if you need reassurance read the article in the Times real estate section today.
Posted by: guest at August 19, 2007 5:45 PM
I don't have a problem with buying in principle, but I would use the recent uncertainty for to ask for a discount from the seller.
Posted by: guest at August 19, 2007 6:15 PM
Agree with B Square. Your house is your home. Just make wise reno decisions. Disagree with Guest @6:15. Why a discount from the seller. Some homes in Brooklyn will feel the tremors of this market but many of the homes in the BK hot spots will still get multiple offers from credit worthy/income documenting /20 % cash down buyers. Go for it if you can afford it.
Posted by: guest at August 19, 2007 7:34 PM
Hi - original poster here - thank you all for your feedback!
The house in my estimation is fairly priced.
I'm now feeling somewhat bullish about the longterm benefit of the purchase--not necessarily only economical, but a long term home!
Shucks, my 401k has seen more ups and downs than any of my investments and I stay w/ it! I'm 40 and still have an agressive outlook, not ready to be passive about things. I'm going for it, because I can.
Posted by: guest at August 19, 2007 8:52 PM
i too think that you should go with your heart- at the same time it couldnt' hurt to ask for some concession on the price as the market has changed consideragbly in a short time. It can be done in a reasonable and friendly way but it could help you to do the upgrades you need to if they can come down a bit on the price- or give cash back at clsoing for improvement- even 45 grand would go a long way towards fixing the place up and that's only a 5% price cut.
Posted by: guest at August 20, 2007 9:55 AM
I say go for it.
The prices sounds good and I think if it's a real HOME and you plan on staying long term, any NYC real estate is a good investment.
I differ from 7:05 however - that's an exageration. I know people who bought for $550k two years ago for a 17' wide, 3 family house in need of renovation and now similar houses are going for $650-700k, if they've been renovated well (and much of the neighborhood housing stock has seen a lot of rehabilitation in the past few years), then they're going for around $800-900k, so your price sounds on-point.
Plus, the value increases aren't just on paper - there are many, many more restaurants and services in the neighborhood. The prices are reaching a point also, where it's no longer profitable to build section 8 housing, which means it's reached an economic tipping point. It is a very, very good time to buy in Bed Stuy.
If one were to compare it to a stock, Bed Stuy is like a really solid "value" stock and I think it's going to do well in the long term.
And you're also obviously seeing this as more than just a monetary investment, rightfully so, and I think you will find that Bed Stuy's community is more welcoming than most in the borough. It's the ONLY place I've lived in NYC (going on 14 years now) where strangers say hello on the street. The community pride and involvement here is really genuine.
Posted by: guest at August 20, 2007 10:23 AM
By the way OP, who are you working with on your mortgage? 6.25 is a great rate on a jumbo right now so I'd like to talk to your bank!
Posted by: guest at August 20, 2007 10:53 AM
OP here: locked in w/ Bank of America before the debacle hit - I'm closing on Thursday. Fortunately I bought a 60 day lock.
Posted by: guest at August 20, 2007 6:56 PM
9:55 - thanks, although I like your thinking, I'm not comfortable asking for a concession at this time - as I am closing this week - I want only good karma around this purchase and all is going smoothly - so prefer not to ruffle feathers. Also, I happen to like the current owners alot - it's priced fairly for what I am getting (maginificent parlor and all original detailing throughout - updated heating, electrical, roofing, finished basement etc.) This is a great deal as is!
Posted by: guest at August 20, 2007 7:01 PM
Oops, take that back - the electrical is not updated....
Posted by: guest at August 20, 2007 7:03 PM
hey OP,
did you close on your house? I'm about to go into contract on a three-story in stuy heights and I'd be curious to compare notes on the experience.
Posted by: guest at August 29, 2007 8:18 PM
OP Here - yes, I did close
Posted by: guest at September 8, 2007 11:42 AM
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