You Have $140K Down, Where Do You Buy?
Competition is heating up amongst developers as all the new towers started during the boom years are beginning to come on the market. Unfortunately for developers, an inconvenient thing happened with the mortgage industry — it crashed. The time when buyers could put as little as nothing down on their mortgage is over; now they…
Competition is heating up amongst developers as all the new towers started during the boom years are beginning to come on the market. Unfortunately for developers, an inconvenient thing happened with the mortgage industry — it crashed. The time when buyers could put as little as nothing down on their mortgage is over; now they are expected to come up with 20 percent. “Developers better have a good product if they want to sell,” commented Halstead Director Bill Ross. First-time home buyers, without the equity from the sale of their previous property, will have the toughest time meeting the new requirements, he said. In some places, prices will have to drop. We decided to play a game of comparison shopping for two bedrooms, and a few other options with more space, all priced between $600K and $700K. Pretend you’ve got $140,000 burning a hole in your savings account. Scores of new condos are on the market all vying for your attention; the borough is your oyster. Which one do you choose…
The first choice is a four-room condo at The Crest in Park Slope along burgeoning Fourth Avenue, quick walking distance from transportation and two of the borough’s best retail and restaurant strips. This sprawling duplex in Bushwick (er, East Williamsburg) has two floors, a private garden and a working fireplace. Or you could give up some space to live in the real Williamsburg and have everything you could possibly want at your doorstep. This even smaller condo in Downtown Brooklyn’s BridgeView Tower is literally right next to the bridges into Manhattan, saving you money on cab fare, has SubZero appliances and a “cascading waterfall” in the lobby. Or you could snag an extra bedroom at the lofty Washington Condos in Prospect Heights, an up-and-coming neighborhood and right near Atlantic Yards. And then there’s always the fuhgeddabout-Brooklyn option, this two-family home with an above-ground pool and double curb cut in Lodi, New Jersey. Which one is it?
David Leonhardt of The New York Times advised in a column Monday that you answer none of the above. While he chose to finally buy a place in Washington, he said New Yorkers should invest their down payment for now until the rent ratio (see link, it involves math) decreases. His philosophy as “an evangelist for renting” has been that once you add in the closing costs, repairs, property taxes, mortgage principal, mortgage interest, and other monthly bills if you own a condo or co-op, you might be earning more on your $140,000 down payment if it were invested in something besides real estate.
As Home Prices Drop, Committed Renter Buys (in Washington) [NY Times]
Please visit http://www.bridgeviewtower.blogspot.com this building has run out of money and is run by a bunch of penny pinching clowns.
http://www.bridgeviewtower.blogspot.com
In a building of 59 units with 40 units occupied, Leon is the “ONLY” person who has any form of complaint. His complaints are, for the most part, petty and/or irrational. Has the building endured some growing pains? Yes. But I assure you no other building serves its residents with the attention to detail and personal service that Bridge View Tower offers.
Please feel free to check recent postings on McBrooklyn (http://mcbrooklyn.blogspot.com/2007/06/walk-to-bridgeview-towers-showroom-just.html)
and DumboNYC (http://dumbonyc.com/2006/10/26/bridgeview-tower-development-update-102506/) to see Leon’s complaints and our direct response.
To the readers of this blog, please feel free to contact us directly if you have any questions regarding these concerns or would like any clarification.
Bridge View Tower
bridgeviewtower@yahoo.com
718.237.4360
WARNING DO NOT BUY OR RENT AT BRIDGEVIEW TOWER!!!!!!!
I purchased a unti at bridge view tower in april 2008 and i am living in hell!!!!!
please email me at leonsaplus@gmail.com
i am NOT YET posting facts even after the developer has decided to play hardball, they still have a chance before i take the gloves off.
I’d buy at Toren. It’s the best value and the area has the most upside potential. DoBro will be a very different place in three years.
I don’t care for that Toren commercial. The copy running across the top of the tower was eerily reminiscent. I think Real Estate and TV don’t go together. Real Estate should stick to online and print.
I love the building though. It beats all of the other choices.
Doubt Junkman is a BFC Partner given his previous posts…
Looks like Toren also put together a commercial a la Oro (but a lot less amateurish):
http://www.youtube.com/watch?v=332nHNkLmy0
It’s interesting that they haven’t used it on TV yet (not, at least, to my knowledge). Perhaps business is brisk enough without any of that?
10:34 comparing stocks to r.e. is just wrong. Wrong on risk: the odds of an index fund, the way that retail investors should invest in the stock market, going to zero are close to zero; if it did, urban real estate would be well under zero. In contrast, in a leveraged house investment, you lose all your equity if prices drop 20%. And prices in Brownstone Brooklyn need to drop more than that to be in line with construction costs, rental value, or comparable cities elsewhere in the region. Wrong on expected returns: doubling your money in 5 years in the stock market (unleveraged) is quite unlikely. Doubling your money in the next 5 years in real estate (leveraged) is far less likely than losing your entire downpayment. Wrong on taxes: the capital gains giveaway applies only to the owner-occupied part of the house. If you are using rental income to pay for part of the house, you aren’t getting tax free capital gains (unless you are planning on committing criminal tax fraud) there. And there is no depreciation on the owner-occupied part. The mortgage subsidy is real, and nice, but it isn’t enough to make a bad investment into a good one.
10:34 comparing stocks to r.e. is just wrong. Wrong on risk: the odds of an index fund, the way that retail investors should invest in the stock market, going to zero are close to zero; if it did, urban real estate would be well under zero. In contrast, in a leveraged house investment, you lose all your equity if prices drop 20%. And prices in Brownstone Brooklyn need to drop more than that to be in line with construction costs, rental value, or comparable cities elsewhere in the region. Wrong on expected returns: doubling your money in 5 years in the stock market (unleveraged) is quite unlikely. Doubling your money in the next 5 years in real estate (leveraged) is far less likely than losing your entire downpayment. Wrong on taxes: the capital gains giveaway applies only to the owner-occupied part of the house. If you are using rental income to pay for part of the house, you aren’t getting tax free capital gains (unless you are planning on committing criminal tax fraud).
where can I gtet a mortgage for 6.02% ??? give me a break. ANyone that believes what bankrate says is a moron. 7.2% for Jumbo sure no problem. End of the day it’s nearer to 7% for normal whatever you call it vanilla mortgages and jumbo is well over that close to 8 if not higher and that’s for duh full doc. jmho
Junkman, are you a partner at BFC???