Open House Picks

WT prices are a bit of an oddity. However, it is one of the most stable neighborhoods in the borough. It was stable and safe when 5th Ave was covered in little glass vials.

A few years ago we tried renting a family-sized place (3 bedroom) in Brooklyn in a decent neighborhood (preferably near a park) with a little outdoor space for a BBQ. Not only was there nothing decent available, there was nothing available (period). We bought a house in Park Slope.

So maybe 247’s price won’t appreciate rapidly in the next 10 years, but finance guy’s analysis is total B/S: You just can’t rent a single family house like this anywhere near Park Slope.

247 is a unique house on a great block (near the park, near the theater, etc.) – It seems worth it to me… Definitely $1.15… but $1.25 doesn’t seem out of reach.

FatLenny: The assumed rate of return for down payment opportunity cost is subjective. Some people are very conservative investors, and for them maybe the current short-maturity treasury yield is the right rate (after-tax yield of, say, 3%). The rate of return for an experienced investor with a balanced portfolio of stock, debt and cash (such as myself) will be higher (I should be able to comfortably hit an average after-tax rate of return of 7% – I used 6% in my previous post to be conservative). The rate of return for someone with a successful and growing business that is starved for capital is much, much higher.

The point is that everyone is giving up *some* return when they put cash into a down payment, and the after-tax return that is being given up should be analyzed as an expense when deciding whether a particular property is priced appropriately.

You are correct that — completely separate from the “deemed expense” of the opportunity cost — appreciation should also be taken into account. But that should be analyzed as a gain that offsets the “expense” of the lost opportunity cost. That being said, what do you really think appreciation is going to be in Park Slope in the next 10 years? I would wager that I would be able to buy this brownstone for very close to its current asking price in 2018. Don’t forget about the 10 lost years in NYC real estate after the market crashed in the late 1980s. And also don’t forget that if you buy into a falling market and have to sell your assumptions about appreciation can quickly end up becoming a nightmare of depreciation and lost equity.

And looking at recent price history gives false comfort at the top of a bubble, although for whatever reason it is human nature to do so

Just my $0.02.

An almost exact house as the 10th Ave. place, but with all original details, recently went into contract around 1.3, after sitting for months. 10th Ave seems way overpriced. As for 225 Windsor, not sure what is up with that – the link shows a March open house and I don’t think it is still on the market. I’ve been talking to a guy at Warren Lewis for months about WT houses and he has not mentioned 225 Windsor.

I am in agreement with the above poster who think the WT houses are way overpriced – but it is making me feel pretty positive about my recent purchase of a house in that area – admittedly a MUCH lower priced house!!!!