Extra $$$...buy or pay down 3 other motgages??? NEED ADVICE!!!

I don't know that now is the right time to buy any investment property in NYC. The market's not going to stabilize anytime soon. I might also be a bit concerned about owning investment properties in AZ during this climate, though, if things are working for you then might as well hold for now.

Wait a bit on the NYC stuff, though.

Depending on the legal structure you own your AZ apts and the State laws in AZ, I would never pay down those apts. You may have a free "put option" on each of them while minimizing your loss to the 20% down payment. Don't pay an additional penny on AZ and ride the economic storm out, if things flat line and then recover in 4-7 years then you can change your mind. If things get real nasty in the next 24 months, then you may have the option to walk away.

Good advice, patient. Don't pay AZ... BUT, I wouldn't buy anything in NYC now either...

So, hold your cash.

You guys are great...thanks for the advice!

Again, I have "normal" mortgages on each of the 3 condos in AZ...$155,000, $196,000, $296,000...each had a 20% down payment when I bought them and my great tenants are family...so they are'nt going anywhere...

Only one friend said, i would be crazy NOT to pay down the mortgages with this extra cash, as it is "debt"...

i disagreed.... and said they are INVESTMENTS...she and I argue about it...:)

She owns outright a E 71st 1BR, but it has a whopping $1300 maintenance! She bought it in 1985 for $98K!!! it has to be worth $500K minimum!!! Should she sell??? Sit tight??? it's like a $400,000 profit so to speak!!!

Eric

I agree not to buy anything in NYC now. Probably not for a year or two at least, and I'd be in no rush at that point either.

But I'd avoid small-time ownership in anyplace I don't live. Current tenants might be great, but future ones could easily be nightmares. Especially in AZ.

I don't know where in AZ these are (very curious to know), but if in the Valley of the Sun, I'd sell them if at all possible. The very existence of condos there was, for the most part, a huge part of the irrational exuberance in real estate that came late to AZ, caused massive overbuilding, and crashed hard. Demand won't pick up enough for decades, and much less so for condos than houses. That's because (in part) apartment living isn't really part of the wide-open-spaces Arizona dream, but between the easy-on-houses weather, relatively large standard lot size, and low taxes, just a quick (usually rental) transition to easy-on-the-wallet single-family house ownership.

Are your AZ mortgages fixed-rate, or variable, or what?

You bought way below peak in Phoenix, so sit tight there.

$1300's not bad for maintenance. And where would she go?

One is interest only...the other two are at fixed rates...and family lives in there...

I bought in 2005...

They are in prime locations in Scottsdale...

Love the advice...keep it comin...

NWT: why do you say he bought way below peak? We don't know when he bought, he didn't say.

He didn't have to say. Only two counties to check in AZ. I get to recycle "naive ownership structure" twice in two days.

you funny, I like that

"Only one friend said, i would be crazy NOT to pay down the mortgages with this extra cash, as it is "debt"...

i disagreed.... and said they are INVESTMENTS...she and I argue about it...:)"

Not mutually exclusive. You can have debts on investment.

What you need to figure out is if it is worth it to have the debt. Debt can be cheap to carry if rates are low and/or deductions good.

The downside is increased risk... but with RE your losses are often capped at what you put in already.

I get huge tax breaks from the condos...that has been the plus...

So, yes, the deductions have made "sitting tight" worth it...and the rates are decent...tenantrs wonderful...

I just didn't know if I'd actually be "throwing $$$ away" by paying down a mortgage or 2...

I like all who said, keep the cash...

Some of us are buying now in NYC.

I find the current situation favorable to me but I am in a minority.

I agree with the others to not pay down the mortgages on the rentals. However there is an exception.
Make sure they are refinanced to reflect todays better rates and you may need to put $$ to get back to 80/20 for refi. But down throw all the money at them.

Good point...so, I may put some back into the mortgages to reflect 80/20, THEEEN refinance...

$1300 is high maintenance for a 1-bedroom, even for Trump Plaza. I guess it could be a Jr-4, but if maintenance is $1300, the price won't be $500k.