PLG House Sells Over Ask
[nggallery id=”53716″ template=galleryview] Park Slope is not the only place where houses are flying off the shelf these days? Prospect Lefferts Gardens is getting in on the action too, as evidenced by this recent data point: After hitting the market with Douglas Elliman with an asking price of $899,000 on January 5, the three-story brownstone…
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Park Slope is not the only place where houses are flying off the shelf these days? Prospect Lefferts Gardens is getting in on the action too, as evidenced by this recent data point: After hitting the market with Douglas Elliman with an asking price of $899,000 on January 5, the three-story brownstone at 251 Fenimore Street closed on February 4 for $935,000. What is this, 2007?
Rent 251 Fenimore for five years: 935k/16(prevailing gross rent multiplier) x 5 = $292,188 gross
Sell 251 Femimore in five years: 935 x 0.36 (depreciation) = $336,600 gross
Net taxes, fees, upkeep, operation, interest, etc annihilate benefit of mortgage deduction.
Renter wins, puts down his saved 44 grand and buys it for only 600 grand. All up from there.
***Bid half off peak comps***
so a rent/buy question, for DIBS or whomever:
do you think rent roll for a multi-family figures into the rent/buy calculus? e.g. an owner-occupied 3-family brownstone, where the mortgage is covered by the rental income. The owner doesn’t occupy the whole property, but that seems offset by the rental income. I’ve yet to see a rent/buy calculator that deals with this situation, which is obviously extremely common in brownstone brooklyn.
I’m not surprised by this house selling quickly. I’m a recent buyer paid over ask for a place in bed stuy….yep supposedly the land of bargains and half priced brownstones. I looked for almost 2 years to find the right house. When I did there were I believe 5 or so bidders in one week. I was not even the highest but had sound financials so was chosen. I closed in about 8 weeks and had no probs with the bank. In the meantime other houses close by are still sitting. My observation is that there is a completley different market dynamic right now for good houses with all the ticks, than there is for average ones. Mine actually does need some work (not major) but it is on a great block and has a unique architecture.
As per the those doing the ‘comparative’ rent vs buy comparisons a genuine question..how often do you actually see reasonably priced rentals for full brownstones with such amazing restored detail, maintained to this standard, with a bathroom like that, your own garden etc? I don’t honestly know the answer as I have nver been interested personally in exploring renting this type of property..I wanted my own home, but my gut feel is that the buy/rent thing may be more pertinent for a different category of property.
BHO, I applaud your stamina. Three years at this and you’re still at it.
The ignorance in the face of reality is what I can’t get over though.
By Brownstones Half Off on February 23, 2011 12:34 PM
Alright. Everybody just calm down. Change your wet diapers.
Hello there BHO. Flushed with excitement on your ‘Melo call, here you are again! You are crazy. ha.
gamblers and people who live day-to-day hand to mouth should not buy real estate. That was the problem with the mortgage disaster. I am not saying it is for everyone. If you prefer to gamble on the stock market then so be it. But you are being very unwise.
When the real estate market crashes you still have a house to live in, when the stock market crashes you have bupkus.
“I am saying that if you are going to factor home price appreciation into the rent vs buy equation, you need to factor in the opportunity cost of putting a down payment into a home relative to the money that could have been made investing elsewhere”
Certainly I agree but given the volatility of the markets over the past 10 years, you could only count on the risk free Treasury rate. And even there might be some detrioration of capital as rates rise.
The 1, 3, 5 & 10 year returns to 12/30/10 for the S&P 500 are as follows:
S&P 500² 15.06% -2.86% 2.29% 1.41%
Those 5 & 10 year return nunmbers (2.29% and 1.41%) are not very encouraging given how much houses appreciated over the past 5 & 10 years!!!!
**Past performance is no indication of future returns**
Alright. Everybody just calm down. Change your wet diapers.
What other brownstones went for over ask recently, FIRST STRAIGHT OUT OF THE GATE ORIGINAL ASK before the sanding and cutting? No this aint 2007. The can was kicked to the present and now it’s full of lead.
Why is NY Case-Killer year-over-year screaming “MAY DAY…MAY DAY…MAY DAY…”? and eying 100 [and why no thread?]
Why are teachers and firefighters getting laid off?
Why are corporate profit margins getting smashed?
Why are the bailouts continuing in Europe?
Why are the big banks still allowed to lie in their accounting?
Why isn’t fraudclosuregate resolved?
Why all the complaints about rising property taxes?
Why is geo-political, civil unrest spreading?
Why are there bank runs in Korea?
We’re now down 22% and have another 36% to go. Buy now while near peak comps last. Wait’ll interest rates spike. Enjoy your mortgage masochism.
***Bid half off peak comps***
DIBS, not saying putting your down payment money in the stock market is a smart idea – it’s not. I am saying that if you are going to factor home price appreciation into the rent vs buy equation, you need to factor in the opportunity cost of putting a down payment into a home relative to the money that could have been made investing elsewhere.
Minard, your comment that the buyer is better off while the renter remains where they started is only true if the home appreciates more than the renter made in the interim through the savings between buying and renting and the investment gains the renter made elsewhere with the money that would have otherwise gone to a downpayment.