House of the Day: 41 St. Marks Place Revisited
Are we surprised that 41 St. Marks Place just underwent its second price cut? No. Do we think there will be more to come? For sure. The listing has been a disaster from the beginning. After hitting the market in mid-January for an insane $3 million, the three-family house was cut almost immediately to $2,650,000….
Are we surprised that 41 St. Marks Place just underwent its second price cut? No. Do we think there will be more to come? For sure. The listing has been a disaster from the beginning. After hitting the market in mid-January for an insane $3 million, the three-family house was cut almost immediately to $2,650,000. The 3,600-square-foot has now been cut again to $2,450,000. In addition to the mispricing, the presentation is abominable—Elliman should be embarrassed about this one. The crappy, overexposed photos only work against it. We took about five seconds to press the “enhance” button in iPhoto and improved them to what you see above. But who took the photos to begin with? That kid in the back hallway? This price has a ways to go, in our opinion.
41 St. Marks Place [Douglas Elliman] GMAP P*Shark
HOTD: 41 St. Marks Place [Brownstoner]
4:33 if you have a mortgage, you too are renting. Renting from the bank
because it’s not renting.
4:19 — you could take your 1.6m, buy this place, live in one floor and cover your mortgage with the rent from the other two.
Or you could buy 8% bonds, giving you $10500/month income, rent the floor through, and still have $7500/month left over.
Why is buying better?
Wealthy people, if they know what they are doing, know the difference between investment and consumption — and that primary residences are a tax-sheltered form of the latter, not the former.
If you sell the house in 20 years for $5m you will barely break even in nominal terms. You’d do better in T-bills, and then you wouldn’t have to live in Gowanus for the next 20 years. Do the math.
That’s assuming that in 20 years you can find someone who believes that it’ll be worth $10m 10 years later, or badly lusts after the Gowanus lifestyle. Otherwise, you’ll find that it is worth its rental value, which in 20 years, if rents go up 5% per year, should be just about $2m.
We bought our place in 1995 for 150K on the Upper West Side.
And sold it in 2007 for 1.8 million.
I’m not interested in renting.
It IS foolish to rent long term rather than to buy a place that costs less, with your mortgage deduction, if your income is stable, than to rent long term would cost you.
But it is NOT more foolish to rent long term rather than buy a for MORE than it would cost to rent a comparable space. Just doesn’t make sense to do that.
Sure, you can say, that in the LONG RUN, that you will have some appreciation. But most people don’t want to have to count on staying put for 10-12 years to break even (possible in a down market), or longer. Even if I plan to stay put, I want the option to sell at some small profit if I choose to move for all the reasons people move (family size changes, health issues, job or romance related relocation, nasty high rise building nearby makes me live in construction site area and then blocks my view, whatever.)
And anyway, that appreciation (when compard to paying rent) needs to take in the increases expenditures over the years of repair and renovation, higher insurance than renters pay, real estate taxes paid, lost interst income on money put down, etc. Not saying buying can’t be a very good thing (did it and did well with it), but it isn’t the obvious choice for everybody in every situation or every market that some people make it out to be. It doesn’t take brains to see that, given the mortgage meltdown in this country.
Anything that can get an 80% LTV mortgage only if the appraiser is on drugs or the take is “sub-prime”.
doesn’t matter if you are paying double.
it is going into equity which you will then sell later. hopefully at a higher price. in nyc, your bets are good that 20 years from now, this house will sell for 5 million. that’s the way these things work.
instead of throwing money into a landlord’s pocket.
like i said..no wealthy person in the world does not at least own their own home.
it’s digraceful to suggest otherwise.
If renting is half the cost of buying — which it is in BH and this house in Prime Park Slope — why is renting foolish? Paying double is never a good investment move.