11217: True my analysis is just based off of the NY Times Sunday Real Estate "Recently Sold" column, but I can't remember seeing anything about $1k psf there in a while. Agree with you that prices were over $1,000 psf at one point and asking prices are still over $1,000 psf though.

Regardless, anyone that is analyzing this properly from a cash flow perspective would need to have a strong view that prices are going to appreciate significantly for it to make sense - or else be willing to pay a huge premium for owning versus renting. Hard to dispute that.

Posted by: thedudeabides at January 28, 2010 1:04 PM in response to 329 Prez Finally Sells—For Less Than 50% of its Peak Ask

Seems like $778 psf is around what stuff is selling for in Manhattan right now. I'd rather live in CG than Manhattan but that doesn't mean prices shouldn't be at least 30% less than in the village.

The mortgage is probably 10K at least. You could rent a place like this in the neighborhood for half that. I'd say it's worth a little over a mil at best.

Posted by: thedudeabides at January 28, 2010 11:41 AM in response to 329 Prez Finally Sells—For Less Than 50% of its Peak Ask

Winner's curse strikes again

Posted by: thedudeabides at November 13, 2009 9:43 AM in response to Big Turnout for 437 Waverly Auction

Agree, public plaza and parking lot was better, but I guess not everybody likes being outdoors and the block is severely lacking in granite countertops, stainless steel appliances, and golf simulators.

Posted by: thedudeabides at July 30, 2009 12:23 PM in response to Work Set to Begin Again on 360 Smith

Yeah, because the foundation is substantially complete. I saw a kid dig a hole in the sand at the beach that is more of a substantially complete foundation than this place.

Anyone have color on what the going per square foot bribe rate is for the BSA?

Only consolation will be when the developer goes bust.

Posted by: thedudeabides at July 30, 2009 11:57 AM in response to Work Set to Begin Again on 360 Smith

I really like this place. I think I would buy it for 450K if I could figure out how to get a door into the second bedroom. Maybe rig up some sort of hall where the closet is?

Posted by: thedudeabides at May 21, 2009 3:54 PM in response to Condo of the Day: 555 Washington Avenue, #1A

I really like this place. I think I would buy it for 450K if I could figure out how to get a door into the second bedroom. Maybe rig up some sort of hall where the closet is?

Posted by: thedudeabides at May 21, 2009 3:53 PM in response to Condo of the Day: 555 Washington Avenue, #1A

Nothing wrong with refinancing if the present value of the after-tax interest reduction is higher than the costs to do the deal. All else should be held equal.

Posted by: thedudeabides at May 14, 2009 12:19 PM in response to Refinancing: How Sweet It Is

If I could get a 4 story for $1.2m in a neighborhood where I could rent at $1,500/mo per floor I would buy. Don't think that is the reality right now though. Those are prime CG/CH/BH rents and just south of $2 at best seems to be the current market these days.

Plus this would have to be a long-term bet as the next buyer in a resale will almost certainly face higher interest rates causing values to continue declining, as astutely pointed out above.

Posted by: thedudeabides at May 14, 2009 12:14 PM in response to Refinancing: How Sweet It Is

vinnie, well put. Amazing how this type of common sense went out the window in the last few years. Figure this place is worth a 6K mortgage 20% down I put the value at $1.2m.

Posted by: thedudeabides at May 7, 2009 9:37 AM in response to House of the Day: 433 Pacific Street

I love the Red Hook house and love the neighborhood. It might be only 25% overvalued rather than what I would say has be 50% overvalued for pretty much everything else (PS studio is also an exception)

One could easily park on the street and get a parking spot near the F line for under $200 if the lack of transportation was a significant issue.

Posted by: thedudeabides at April 30, 2009 11:59 AM in response to Brooklyn Sales: Under a Million

Explain the high maintenance fee when this is probably one of 4 apartments in a brownstone? Seems like that should be per year

Posted by: thedudeabides at April 16, 2009 1:14 PM in response to Co-op of the Day: 314 Clinton Street, #3

What cw says, but you could keep in Brooklyn Heights for 400K-500K and I don't think it would sell immediately at this price

Posted by: thedudeabides at April 9, 2009 1:28 PM in response to Co-op of the Day: 62 Pierrepont Street

What would this rent for? 2K?

Posted by: thedudeabides at April 2, 2009 1:02 PM in response to Co-op of the Day: 59 Pineapple Street, #5I

Worth $250K maybe $275K

Posted by: thedudeabides at March 5, 2009 1:37 PM in response to Co-op of the Day: 220 Congress Street, #6D

"Now if it was bought for $870K in 2006 we don't see how it is worth more than $900k in this recession..."

Wasn't 2006 pretty close to peak when everyone thought things were going to be great forever? Aren't we now in the worst recession in at least 50 years? thus, shouldn't it be worth less than $870K?

Posted by: thedudeabides at March 3, 2009 6:13 PM in response to House of the Day: 365 Parkside Avenue

Now is a great time to buy. People are moving into Brooklyn in waves as it becomes increasingly family friendly and new great shops and restaurants are opening up all over the place. Things are different in Brooklyn given it is NYC where foreign buyers will continue to pick up real estate and there is an enormous amount of wealth. Prices will just continue to rise. Buy now or be priced out forever!

Posted by: thedudeabides at March 3, 2009 11:48 AM in response to Brownstones, Co-ops Outperformed Condos in Q4

Thanks for the voices of sanity above.

Agree that if you love a place the numbers might make sense to you even if the potential rental income doesn't support the price. However, when making the major decision to purchase an apartment in NYC, I think it is important to understand what someone else would be willing to pay for the place in the unfortunate circumstance that you need to sell (lots of people losing their jobs these days).

Regarding your other comments:

http://en.wikipedia.org/wiki/Ad_hominem

Posted by: thedudeabides at February 24, 2009 4:41 PM in response to Co-op of the Day: 360 Clinton Avenue

Guys, I think your comments are a little beside the point. When determining how much an apartment is worth, you need to consider how much an equivalent apartment would rent for (in fact, when computing the CPI, the gov't uses "owners' equivalent rent" not housing prices). If rents get too out of whack with prices, people will choose to rent instead of buying, driving sale prices down, and vice versa when rents get too high (say in 1997)

I completely agree with the concept of looking at a place as a home rather than an investment, but when considering how much one is willing to pay for a given place one looks at prices on comparable apartments, which are effectively set by rents as per the logic above.

In fact, buying a place solely because you think someone will pay more for it in the future is the definition of bubble mentality, as described by the greater fool theory.

http://en.wikipedia.org/wiki/Greater_fool_theory

The ignorance in this country about fundamental economics is astounding and worrisome. That said, I have some real estate to sell you. You should pay whatever I ask because the more you pay, the more money you will make when you sell it for more in the future!

Posted by: thedudeabides at February 24, 2009 3:10 PM in response to Co-op of the Day: 360 Clinton Avenue

daveinbedstuy....if you think that place is worth $850K not for income potential but because someone will pay more for it in the future, my theory is that you are the greater fool! (look it up)

Posted by: thedudeabides at February 24, 2009 2:35 PM in response to Co-op of the Day: 360 Clinton Avenue

PropJoe, Daveinbedstuy: Anyone who would shell out almost a million dollars for an asset and not consider cash flow is the dumbass. Unfortunately, as you illustrate, this describes a good portion of Americans and goes a long way in explaining the mess we are currently in

Posted by: thedudeabides at February 24, 2009 1:37 PM in response to Co-op of the Day: 360 Clinton Avenue

Nice place but given location I can see maybe $3,000/mo rent max. Let's see...20% down, mortgage payment $4,500/mo., only 3K negative cash flow a month! Great investment!

Posted by: thedudeabides at February 24, 2009 12:53 PM in response to Co-op of the Day: 360 Clinton Avenue

...if you believe rents are going to hold at $1,500/mo in Clinton Hill when you can get a 2BR on the UES for that price these days

Posted by: thedudeabides at February 18, 2009 1:20 PM in response to House of the Day: 55 Cambridge Place