House of the Day: 289 Garfield Place
289 Garfield Place was an Open House Pick last month shortly after it hit the market with a price tag of $1,950,000. It’s a nice house in a nice Park Slope location, but it feels to us like it lost a bit of its soul when it was recently renovated. It’s also a four-family house,…
289 Garfield Place was an Open House Pick last month shortly after it hit the market with a price tag of $1,950,000. It’s a nice house in a nice Park Slope location, but it feels to us like it lost a bit of its soul when it was recently renovated. It’s also a four-family house, which takes it out of the running for a lot of family buyers. Of course, having three rentals does help take the sting out of that monthly mortgage payment.
289 Garfield Place [Corcoran] GMAP P*Shark
But BHO uses 10X so it must be correct.
The location and beauty of this house will surely make it a good buy. I could see someone wanting to buy a house to live in and share with two children but have separate apartments or some one seeking to invest in a property to sponsor as a condo. With this location as I said, someone will figure it out.
I agree with you dibs.
Maly…the 10X, 12X historical numbers don’t take into account where the risk free rate is.
If I can earn 4.2% in 30 Year Treasuries with no pain, no aggravation and no risk, I want a premium over that for an aprtment building even with the assumptions that rents will rise.
The stock market has risen by a compounded annual rate of 7.3% since we started our fund in 1993.
The 10x and 12X numbers don’t have any basis except to be arbitrary.
I think the mean for NY used to be 12X, but in this instance I was referring to dibs 6% net return on cash. Some people think we will regress back to the mean across the board, but I don’t think so, not for free market rentals in prime spots, because these are safer investments than say rent stabilized units in marginal neighborhoods. This is only my opinion, of course.
Maly,
I saw rents drop last year by a couple hundred dollars all around, and then saw them go right back up this late summer and fall.
I guess they could be slightly lower, but what I’m seeing now at places like Ideal Real Estate is that they’ve made almost ALL their apartments NO FEE, but the prices are back to peak levels. I guess they’re having the landlord pay the fee, but if you go to their storefront, every place for rent on the Berkeley Place side of the window has now been updated with a watermark NO FEE on each listing.
But prices are back to about what these are. In fact, I think they could probably get $1500 on that studio if they were to rent it out now.
Of course for the calculations you guys are doing, you want to be conservative so I see your point with that in mind…
Maly, thanks, calculator error.
I think I’d take a haircut on those agressive rental numbers just to be safe!!!!!
thank you maly. i second that motion, though i might have to recuse myself. btw, why do you think 16.6x is a “sweetspot”? do you have any historical data?
11217, do you think rental prices are a bit lower now?