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]
6:05: You are an idiot.
If you knew anything about Bed-Stuy you would know that it is HUGE and the crime stats cover both the unsafe projects to the north and the extremely safe southern parts of the area. You can easily live in Bed-Stuy and not see, hear or be a victim of crime. I have lived in the area for over 3 years and my biggest problems are the squirrels digging up my flowers and trying to get through the neighborhood we every other block is having a block party.
So the next time you even think of putting your lilly-white fingers on a key board to make a generalization about a neighborhood of which you have NO knowledge, think twice. Otherwise you will prove the point all of us in Bed-Stuy already now: You have never been here and you are afraid to find out what it is really like because of your racism.
Downtown or Park slope. Safest bets.
i live in philly,and u can get a 3bed. row house(kinda like the ones in east new york and red hook)here for 30K.better bring a gun though.
4.41pm
With all due respect, you could not be farther from the truth. Bed-stuy is crime ridden. You just have to look at the prencint reports, or the gun-related violence reports. These are reports which summarise a systematic pattern of violence (murder, rape, assault, larceny) much higher than the surrounding neighbourhoods.
To say that Bed-stuy is not crime-ridden is just statitically wrong, regardless of what role demographics may or may not play.
Thank you 4:41 and 4:49
There are a lot of non-african americans in bed-stuy. You all need to get out more.
The people who think Bed Stuy is a ghetto have not been there in a loooooooong time. Keep in your lilly white bubbles.
White people are afraid of black people for absolutely no reason. You pay crazy prices to live in a “safe” neighborhood and ASSume everywhere else is “fringe” “ghetto” and “crime ridden”, For those of us who live in Bed Stuy, we know the truth because we live it every day. You are simply talking out of your asses.
2:02: You are a moron who added nothing to the conversation. Nothing.
daveinbedstuy – my point is that will have the same risk and reward as the proposed investment. As such, you cannot compare the down payment expected return to that of a risk free investment……the opportunity cost needs to be much, much higher
mrspock…the 20% may be the required risk adjusted rate but that does not mean you are actually going to attain that over any particular period of time. You can’t assume what is required is actually attainable.