The One That Got Away
Harvey Araton, a sports writer for the Times, penned an epic tale for the paper’s real estate section this weekend about making peace with his decision to sell low in Brooklyn Heights nearly 17 years ago. According to Araton, he wrote the article as a form of therapy, since he’s often kicked himself for selling…
Harvey Araton, a sports writer for the Times, penned an epic tale for the paper’s real estate section this weekend about making peace with his decision to sell low in Brooklyn Heights nearly 17 years ago. According to Araton, he wrote the article as a form of therapy, since he’s often kicked himself for selling his family’s co-op in the busted early ’90s market: “It has been 16 1/2 years since we sold a two-bedroom apartment in Brooklyn Heights, en route to the suburbs and the birth of a second child. Actually, I should say that we gave it away: We lost about $80,000 on a $240,000 purchase made in 1988.” The current value of the co-op is around $900,000. Araton gets in touch with other people who sold in the building—which Brooklyn Heights blog identifies as 157 Hicks Street—at around the same time. “After reconnecting with our old neighbors, the other thought I am left with—and hope to hang onto—is that as much money as we lost, judging a period of life by the bottom line is the road to existential ruin…I suppose, then, that the closure I have been looking for might be in the realization that the apartment was never just an investment. It was a place to live,” he writes.
A Brooklyn Apartment Sold Too Soon? [NY Times]
Photo from Property Shark.
THE GUY DIDNT MISS ANYTHING!!!!!!
He would have done just as well taking that 160K (sale proceeds in 1993) and putting it in the Stock Market (S&P 500) – (annual return of close to 8%).
Why would anyone ever want to leave Brooklyn?
It’s a myth that the buy-sell-rent decision is not a major financial decision that has more impact on a family’s finances than probably any other since decision.
This article just perpetuates the myth that caused all the trouble to begin with — that home ownership is a ptimarily financial investment and not a decision about how and where you want to live.
noodlemanias – I would consider you a south sloper esp if you live above 5th avenue – if that helps…..
Lech – so true…so true
I found the article annoying. He made decisions based on his needs at the time. How many other money making opportunities did he miss out on? He can write volumes on that topic. We all could and we’ll all go crazy bananas thinking about such things.
I think we’re all just SO tied into the group think, mass opinion crap–looking for validation for the real estate decisions we make. As a brand new home buyer, I am guilty of this too. Did I make the right decision buying right now? We bought because we’re having a baby and really do need the space and need to stay in Brooklyn for our work, and our art, etc. And I hope we made the right decision and not loose our shirts in the long run. But, what are you going to do?
My new buyers mantra…NO REGRETS.
PS. I’m also a new South Sloper. Or do I now live in Sunset Park? I’m at 18th street…
Yes, Mopar, my thoughts exactly. It was very different back then. I remember emptying my savings account and going to the closing thinking “22K is an OK price for a 1 bdr apartment, but then why was it on the market for 2 years? am I the only fool that doesn’t see something obviously wrong with it?”
Don’t extrapolate from this anecdote any lesson about whether now is a bad time to sell. This is a story about someone who happened to sell at the bottom of a cycle and now with many years hindsight sees that it was a bad decision. That by definition represents a small percentage of people who sold during that cycle. This isn’t an article about the guy who sold two years before the bottom and avoided losing his shirt because he lost his job one year later and there but for the grace of God because if he hadn’t sold when he did he and his family would have been wiped out. It’s also not an article about someone who sold on the way down and bought even cheaper. Or someone who sold at any point (doesn’t really matter where) and traded sideways.
Many people read stories like this and nod knowingly as if they were just whispered a secret that now is a bad time to sell under duress. My view is that after a brief respite prices are going to keep going down in 2010 (I was on the fence about this for a while but now I’m pretty confident about that).
So no, this article didn’t just impart any wisdom on you and no, you aren’t any smarter about the market now than you were before you read it.
I read this…
but whats the moral of the story?
that he just should have stuck it out in his 1 BR coop until now where he would have made 800K in profit?