Co-op of the Day: 90 8th Avenue
What’s not to like about this two-bedroom co-op at 90 8th Avenue in Park Slope? Besides the fact that there’s only one bathroom, not much. It’s about as classic as a prewar co-op gets. We’ll see how the asking price of $785,000 flies though. The apartment directly upstairs sold for just $580,000 three years ago…
What’s not to like about this two-bedroom co-op at 90 8th Avenue in Park Slope? Besides the fact that there’s only one bathroom, not much. It’s about as classic as a prewar co-op gets. We’ll see how the asking price of $785,000 flies though. The apartment directly upstairs sold for just $580,000 three years ago and the C-line on the 8th floor just closed for $785,000 last month, but who knows what kind of shape those places were in. Think the sellers will get their price?
90 8th Avenue [Warren Lewis] GMAP P*Shark
I don’t see why someone making 200K/350K a year would feel priced out by a mere 799K co-op. I don’t get it.
I also wonder. I know a number of people who are buying (and attempting to buy) one-bedroom apartments in the 600K range who earn roughly $100K gross (where I fit in). Assuming they can get approved, I just think that is insane in todays economy. Im lucky to have purchased some years ago, and I wish, in hindsight, that I leveraged myself more thinly then due to the crazy real estate boom. Am I in the minority?
3:58 – well, you don’t have to buy the most expensive thing you find. we have a 1950 sq ft. condo with a terrific backyard. we put down 30% on $950K (about 1 1/2 years ago) and have total payments of just over $4400 (mortgage/cc’s/taxes). We get a lot of money back, so we figure our real cost is closer to like $3300. We live in north williamsburg near mccarren park. There are tons of kids in our building, and we are all happy with the local school options there. It’s safe, convenient and the amenities in the area are excellent. There are still reasonable neighborhoods.
not debating PS vs. williamsburg here (so.. please don’t), just pointing out other options financially.
i am really really picky about design, decorating, making changes, doing built ins, landscaping etc… so i need to own. also, my payments are set, and your rent is only going to go up unless you move to a worse neighborhood.
3:54 and 3:58 – I agree with your thoughts (I guess you have some business sense if you are doing that well), and have to weigh in that most people do levarage themselves a bit too thin. It was easy with the market rising so much over the past decade and credit being given away to anyone, but I would have to agree that today’s buyer has to really rethink their decision. If you are going to stay in the apartment for the long haul, then thats one thing, but for most Slope 2-bedroom buyers who will look to sell within 5 years when they outgrow their place, Im not sure its a wise move anymore.
I would agree that the apartment in question is not a good buy at that price with that maintenance.
If you borrow to buy an asset that you can’t really afford, and the asset price goes up, you sell and make lots of money. If the price goes down, you sell and lose lots of money.
Econ 101 tells us that in the medium term, prices have to be about the same for owner-occupants and investor-landlords (after adjusting for the tax subsidies to owner-occupancy). Otherwise people will buy the cheaper one and convert it to the other, until the market adjusts.
Right now, buying — after the tax subsidy — costs 50% – 150% more than renting. So rents are going to go up or purchase prices are going to go down.
Pay your money and take your bet. Which is it going to be?
(Hint: no one would ever pay more than they can afford today in order to rent just because they think rents are going higher tomorrow.)
3:54 — no, you are being sensible. All over the country people are in trouble because they gambled in that way. It’s going to happen in Park Slope too.
3:54 — I wonder the same thing all the time. I make about $350k/year and have a couple of kids. There is just no way I would pay asking price for most of the 3-beds in PS. Either people have a lot more parental/trust fund help than I thought or they are just willing to spend their every last dollar just to say they are owners instead of renters. I happily write my $3900/mo check to my landlord every month – nowhere near the $6k to $9k I would have to spend for the “privilege” of owning.
3:31 — how do you get $5000 for costs? At 7% for interest/opportunity costs, the purchase is $4500/month, and the tax subsidy covers 1/3, so it’s really only $3000. Add $1127 for maintenance, with $100 back from the tax welfare dept (unless you are subject to AMT in which case it is less), and you are only paying $4000.
That’s not even double the rental value. And it’s way less than you’d pay for a comparable place in Mayfair or Knightsbridge.
My understanding is that prices decreased in Park Slope ’06 to ’07. No idea if that is average or median or in a particular price range. I think it was in the annual Corcoran report.