fatcat's Profile
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September 10, 2007
When to sell???
So, my family is planning a big move out of the country..we're planning to open a small hotel, and so obviously will need as much capital as possible. We have two four family brownstones, one in crown heights, and one in bed-stuy. We are planning to move in Summer 2009 and are wondering when we should put them on the market...It will kill us to sell them as we've put so much work/sacrifice into buying/renovating them, but everything has its cost I guess... any insights appreciated! Thanks!
Author's Comments
This is a little odd..."quest" has posted two very contradictory comments....hmm.....
Posted by: fatcat at September 11, 2007 12:03 PM in response to When to sell???
thanks everyone for your comments...we had thought about not selling them, and for lots of reasons that would be ideal. However, we bought our 4 family in crown heights, near the children's museum for 420k and now we think its probably worth upwards of 800k..but when we try and refinance most companies are only willing to go to 80% LTV, and then they give us an appraisal of 700k or so..so while we could get some additional money out -- maybe 200k max at a favorable interest rate, its probably not as much as we'd get for selling. I haven't thought about the whole tax situation nearly enough though...30% yikes! How long do you have to be out of the country to avoid city and state taxes..(I feel a little funny asking this, but it would make a lot of difference..)
thanks!
Posted by: fatcat at September 10, 2007 9:26 PM in response to When to sell???
Responses to Author's Forum Comments
I am a local broker and if you came to me as a client, or a friend, I would suggest for you to wait and not sell yet.
-Wait until the spring before you really need to liquidate because spring is the best season to sell. If you were to put your house on the market now (by owner or broker) you would get a lower selling price than if you put it on the market in March, April or May
-Both neighborhoods are terrific and becoming increasingly more desirable to people who don't already live in the area or even in Brooklyn already.
More desirable = higher selling price.
-Houses in Brooklyn are a very finite commodity. There is always, yes, always, going to be an individual or family who wants to own the land under their feet.
Wait. It will be worth it.
Posted by: Honey at September 11, 2007 12:49 AM in response to When to sell???
IMMEDIATELY! THIS DOWN MARKET WILL NOT REBOUND FOR ANOTHER 5 TO 10 YEARS. BY THEN, CLOSING PRICES WILL BE ABOUT 25% TO 50% DOWN. DON'T CHASE YOUR ASKING PRICES DOWN TO THAT LEVEL. THOSE BROWNSTONES ARE STILL SELLING BETWEEN $500K TO $1M. GET THAT PRICE RANGE WHILE YOU STILL CAN. BUT BE WILLING TO CUT YOUR LOSSES AND PRICE THEM ACCORDINGLY. YOU GOTTA UNDERCUT THOSE COMPS AND RESPECT THE BIDS YOU'RE GETTING. IF YOU'RE NOT CONVINCED ABOUT HOW LONG THIS DOWNTURN WILL BE, READ THIS...
IT'S MUCH WORSE OUT THERE THAN YOU THINK. THE 6:00 NEWS AND NY TIMES WILL NOT INFORM YOU OF HOW BAD IT IS UNTIL IT'S TOO LATE. REMEMBER? "NO BUBBLE", "NO SUB-PRIME CONTAGION". RECESSION IS COMING (IF WE'RE NOT ALREADY IN ONE - DATA REVISION). LAYOFFS, ARM ADJUSTMENTS, FORECLOSURES AND INVENTORY (ALTHOUGH NOT BROWNSTONE BUT STILL RELEVANT) ARE ON THE RISE. QUALIFIED BUYERS ARE DECREASING. BE CONSERVATIVE AND SELL NOW. A BIRD IN THE HAND...
Posted by: guest at September 11, 2007 11:12 AM in response to When to sell???
This is a little odd..."quest" has posted two very contradictory comments....hmm.....
Posted by: fatcat at September 11, 2007 12:03 PM in response to When to sell???
opps....the mysterious "quest" is "guest". at any rate, the 9/11 11:12 am poster has me a little nervous...!
Posted by: fatcat at September 11, 2007 12:14 PM in response to When to sell???
I say sell now, not because I think the NYC market is the exact same market as Florida, as 11:12 seems to believe. But because opening a hotel in another country is going to be hard enough without still owning and managing buildings in NYC, from long distance.
I have a friend who says wherever possible, simplify.
Apply that answer to this dilemma, and you'll see the answer clearly: Sell now.
Posted by: guest at September 11, 2007 12:51 PM in response to When to sell???
11:12 here. I don't believe "the NYC market is the EXACT same market as Florida" (NYC YOY drop = 3.4%, Miami YOY drop = 4.8% Source: http://tinyurl.com/2unbyr ). Florida is worse. But from my link you can see that prices here dropped 25% last time so that pretty much sets the lower loss limit. The previous boom was much bigger than that of the 80's. The bigger the boom, the bigger the bust. Prices are likely to go from 6X income to 3X income. Hence the 50% upper loss limit.
Florida will probably fare worse. Have you read about their boom/bust during the 20's BEFORE the Crash of 1929? Land prices made a round trip from $100K to $4M (Source: http://tinyurl.com/38yd4y )
Posted by: guest at September 11, 2007 2:34 PM in response to When to sell???
opps....the mysterious "quest" is "guest". at any rate, the 9/11 11:12 am poster has me a little nervous...!
Posted by: fatcat at September 11, 2007 12:14 PM in response to When to sell???