Open House Picks: Six Months Later
Comment: So-so. Open House Picks 8/8/08 [Brownstoner] Previous Six Months Later Posts [Brownstoner]
Get started on
your next project Comment: So-so. Open House Picks 8/8/08 [Brownstoner] Previous Six Months Later Posts [Brownstoner]
Get started on
your next project
BHO…you keep putting the date off. Whats with that????
Can’t wait ’til May, June…
***Bid half off peak comps***
I hear ya, cwb, oh yeah. The Q is definitely preferable to the F to me as well.
In addition to the commute factor, if prices are falling faster in WT than PS, it might be due to some of the following:
1. WT prices were drive up to a certain extent by Park Slope overflow/proximity.
2. WT has only about 10 blocks that I would consider to be particularly nice looking.
3. There are far fewer amenities such as restaurants and the like in WT compared to PS.
I would disagree that lechacal knows anything about math, or at least finance. Take a look at this gem (I’m going to go out on a limb and suggest PS real estate has fared better than his brokerage account):
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.
I used to live in WT, and I absolutely hated the commute – for the reason that the F is local and there are no good transfers. It was 19 agonizingly slow stops to my office in midtown. Ugh.
Lechacal – I do think of Lehman bankruptcy (Sept 15) as a bright line event. More accurately, the bright line event was the subsequent stock market collapse in early October.
I think this because I am in contract (signed in April), and late Sept / early Oct is when a lot of the money I had set aside for the down payment, closing costs, furnishing and landscaping simply vanished into thin air. Sure, I should have been more in cash, less in stocks, but I was slowly liquidating toward that point when the bottom fell out. In addition, a big chunk of my compensation is in equity, which fell to 1/3 of its former value. Now, they say there will be no raises this year. And I am seeing friends get laid off. While the real estate market may have been drifting down throughout 2008, it wasn’t until Sept that I personally experienced financial free-fall.
Which means the deal that was ambitious in April, suddenly became not only unwise, but essentially impossible.
And I don’t think I am the only one whose financial picture was radically altered in one terrible month – it was a very bright line event for many would-be buyers.
Snark –
I agree the F isn’t THAT bad, but it’s a local train that doesn’t have any good express transfers until you’re into Manhattan, and there are parts of WT that are pretty far away from it.
Depending on where you live and work, the commute from Windsor Terrace to, say, the fashion district (I work on 36th and 6th) could take as much as an hour. If I catch the Q and don’t have to wait very long for a train, it takes half that.
Don’t get me wrong – I’m looking at houses in Kensington right now, because sometimes you gotta sacrifice if you want to own. I’m just saying that the reason WT is sliding faster than Park Slope may be at least in part because of the commute.
dittoburg, I’m picturing the trucker in his rig in Harry Chapin’s “30,000 Pounds of Bananas”. Scranton, Pennsylvania is just up ahead.
lechacal-
I’m beginning to think the same thing about Lehman. I think there is some desire we have for things to unfold, whether they be for good or ill, quickly. If the sh*t is really going to hit the fan, I think most of us would prefer that to the sort of slow burn that seems to be happening in NYC real estate. At least that would give some clarity to the situation and make us feel like we could make decisions with some confidence. Or maybe that’s just me.