111 Fulton (The District), 20 Pine or 75 Wall

none all having problems as far as I understand. I LOVE 20 Pine and really wanted to buy something there, but the risk/reward is too high. I would stay awy from new Financial District buidlings that are not very havily sold ( without a lot of rentals) If you have to buy one--I would say go for 20 Pine

I thought I liked 20 pine, but those layouts are pretty darn lousy...and then just waaaay too much risk given that its an "investor" building, not really a resident owner building.

All three of those buildings are very investor heavy, and not sold yet to meet Fannie Mae/Freddie Mac guidelines so you would need to go outside that system for a loan. Also out of all the neighborhoods in the city FiDi has seen the highest rent drops. If you do buy, make sure you are prepared for the long haul because its gonna be rough there for the next at least 5 years in my opinion. Having said that, I love the amenities areas of District, and some of the floor plans are really nice, downside for me would be the kitchens. 20 Pine I would certainly avoid the most due to 1) number of empty units 2) lawsuits and3) number of units already available for rent.

What about 111 fulton - seems to be more resident owners than the rest of the buildings. I am guessing this because there are very few rentals avaliable.

One building that I think is nice but there is nothing much avaliable there is 90 william looks like mainly a resident owner building

nycbrokerdax - that is my exact issue with 111 fulton - the kitchen - for those of you who have not seen it its practically unusuable. A dishwasher that is 1/2 the size of normal, only an elecric stove top (no gas), microwave is combined with the oven into one unit and its small again about 1/2 the size of a regular oven. Though this is not what I envisoned when buying a place we can upgrade all these things for about 20-25k - not really what you want to do when buying a place but still.

We are buying as owners and not renters for 2/3 years. After that we would rent for two years and then sell probably.

Our thinking was to try and get something for about 900k (1200sqft). Put down 300k. This would make the monthly payments (after tax deduction) about 3600 which is what is the market rent for a one bed convertible two (with amenities in the bldg) from my research in Fidi.

What are your thoughts ?

I think it would be cheaper for you to rent for the 4-5-year time horizon you envision. Rents are tanking. There are still huge problems in the RE market, and none of those buildings is operating on the most solid fundamentals. It sounds like you're really looking to rent for another 2-3 years and then move elsewhere, am I right? In which case, this doesn't sound like a very good idea.

Yes. We are a couple. We expect to have a child in the next 2/3 years. At which point we would move as a 1BR HO (or even a two bed will not work - we would need at least 2bed and home office in 3 years).

I have looked arround and the rents for a 1BR HO are about 3500-4000. Assuming we get a 1BR HO for 900k and put down 300k and assuming $1250 maintainance our without tax deduction monthly payments are about 4500 and after the tax deduction its 3500. Hence, we thought it may be a good idea to buy instead of rent.

I guess our opportunity cost is what ever we would have earned on the 300k down payment and to be honest this money has been sitting in a low interest deposit account for years now as we have had it earmarked as the downpayment for a home.

If we rent assuming 3500 per month for 3 years that is 126k over the three years that we do not get any return on.

If we buy and sell in 3 years at the same price we purchased for then assuming prices do not fall or rise i.e. they just stay the same and we sell at 900k i.e. exactly what we bought it for we could be up by at least 30k assuming the transaction costs to sell in and out are about 10%.

I guess the risk we are taking is that prices fall in 3 years and I guess on that I do not have a crystal ball and do not know.

stay away from 20 pine unless you are a bat.
neeta, have you considered BPC as you plan on a family and it is very family friendly

BPC sounds great but I have some odd criteria.

Ideally no more than 1 or 2 blocks from a subway and a supermarket of some type in terms of amenities at a minimum we want a gym and a washer dryer in the unit. Also we like new construction, we have more contemporary taste. We would live anywhere on the 4,5,6 line below 63rd street. The best value seems to be in Fidi.

And BPC fails does not meet the 1 or 2 blocks from subway (and that is pretty important) nor is it near any supermarkets as far as I know (there is Jubliee and Zeytuna for thes other buildings).

the three buildings on little west are about 2 blocks from the bowling green station, and rector for the 1.
there is a supermarket behind them, a gristities and a small zeytuna near the subway. a new market is schedules to start sometime in 70 little west

Thanks RE2009 - I will check out the neighbourhood. What buildings were you thinking of ?

Neeta, I do think that DISTRICT has more owner occupancy than 20 pine, and if you were really interested, you can absolutely work a different kitchen into a deal with that developer. One of the developers owns the construction company that is on the project and they will work out a different kitchen into a deal (some inside scoop for you) however it would still have to be an electric stove since there is no gas line in the building. I would however as I suggested, tread carefully in this 'hood right now, everyone is over-inflating their "in contract" data to include the ones that are either walking from their deposits, or are in litigation-- also the rent numbers you are seeing for these higher end buildings are the asking rents, they are for sure renting for substantially less-- My fear is yes you will make a good deal but then when you try and rent it out in a couple years you will be getting substantially lower amount of rent than you expect in this area. I feel like if you are going to buy in this area, you really have to be in it for the long haul.

nycbrokerdax - thanks. I will certainly ask for a new kitchen but not sure that they will do that for a unit that I hope to get at 900k for 1200 sf (i.e. 720psf) - but not sure that they will agree given that they have been able to find people (see comparables) to close at higher amounts than other buildings in the area (see below comparables for 1bed ho or 2bed arround 1200sf). But what ever, if they do not come to my level and it does not make economic sence to me - I can always just rent. Times are soo uncertain and I am really sitting on the fence on buy vs rent. Regarding rent - 90 William 6B was for rent asking 4200 - I bid 3650 and got outbid by another renter willing to pay 4000.

Fall 09 closing

1. 111 Fulton Unit 519 (1093 sqft) $865,000 ($791psf) - one bed home office, gym, pool, roofdeck, storage
2. 59 John Apt 5D (1210 sqft) $875,000 ($723psf) - two bed gym & roof deck,
3. 90 William 6B (1193sqft) $902,500 ($756psf) - two bed gym & lounge & snooker room & storage & corner unit i.e. more light

Summer 09 closing

1. 20 Pine Unit 802 (1277sqft) $999,999 ($780) - two bed, lounge, pool, gym, roofdeck

The only way it makes sense to purchase financially is if you have a long time horizon. As you say, times are uncertain. Prices could easily fall for the next three years. Why not rent, save your money for that time, and buy a place that will meet your long-term family needs instead? One thing seems certain given the jobs situation and fragility of real estate: prices are unlikely to rise over the next three years.

Also, just my little opinion, but I think "home occupancies" are a travesty that will soon be regarded as an unfortunate byproduct of the real estate bubble. Although they're frequently marketed as a bedroom, they really aren't. Even a basic junior 4 will get you a window in that little second bedroom, and they're a lot cheaper.

Figure I would chime in and say "great discussion!!!" I believe many are in the same dilemna as the OP. Including me! I also believe that it is NOT a good time to buy, mainly because what another member said, which is "RE is unlikely to rise in the next 3 yrs", if anything, I believe it will fall a bit more...

neeta, check the visionaire. brand new, great amenities, lots of families and close to all the subways

We've been renting in 20 Pine for almost 1 year. I can't say enough great things about the staff, the facilities and the overall quality of the renovation. The kitchens are ridiculously small, but functional. According to my calculations, owning would cost about 3 times the monthly rent and that's even after accounting for the current tax abatement.

When you think about the current number of unsold units, the number of investors and the number of new downtown condos coming on-line in the coming years, it's hard to understand where enough demand is going to come from, especially at current prices. Wait until GS moves out of 85 Broad and that building turns condo!

But I'm off to the gym downstairs, then I'll sit in the steam room and maybe go for a little swim. Life is good as a renter in 20 Pine!

If buyng for only 2-3 years it may not make sense. It's a very short time frame. You've got closing costs to buy and closing costs to sell. You have to pay 6% commission and with all the closing costs, you may not even breakeven. Plus it takes time to find a buyer and you can't be sure the market will improve. People who bought in 2006 and now are selling will tell you that.

Regarding "RE is unlikely to rise in the next 3 years, if anything, it will fall".

- you could be right, you could be wrong, my view is I do not know, I guess is 50% probability it will stay the same 25% it will rise and 25% it will fall. Earlier this year, I did not think that the dow would hit 10,000 (I was 50% sure it would be under 10k) - I was wrong.

- however rents I think will go up as more will favor to rent - in my opinion based on my search criteria there are fewer rental options for me this year than last year for a luxury building with one bed and Home office at the 3500 budget.

I will only go through with a purchase if my monthly costs of owning equal rent. If its 3 times more I wont do it.

If you look at the ACTUAL closing prices of one bed home offices in luxury bldgs they have been closing between 850 and 950. If you assume 30/35% downpayment. The monthly cost (after tax deduction) is about 3600 which equals rent in fact is significantly lower than the asking prices (4200).

Is there a way to find out what else is going to be developed in FIDI in the next 3-5 years in terms of residential condos ? e.g. I did not know that GS was moving out of 85 Broad - are they really going to do that ?

neeta, only you know your situation so only you know if you should buy or rent. the rest is just advise.
please don't take offense but sounds like you might want to do a bit more research, how could you not know gs was moving with all the buzz about the new gs building???

i don't think neeta is a real person... it's a broker or someone trying to sell their place

RE2009 - you are right I probably need to do more research. Is there a list or a a google search term people would recommend. Or a government authority that has this data.

midtowngal - I am not a broker - i do not have a place to sell. Just someone trying to figure out whether I should rent or buy and I am really on the fence.

Do you know that there is an elephant of a skyscraper going up on Beekman the Gehri Beekman tower ???

and are you aware of the fact there are 18.000 apartments ready to go and NOT on the current inventory?

http://www.reuters.com/article/idUSTRE5BL4GE20091222

sure, go ahead, buy in Fidi... buy now before it's too late and cry forever

lol.. people are pretty harsh on this discussion.. it is quite comical...

anyways, my OPINION on the market in terms of percentages of RE atmosphere would be:
5% value goes up
40% stays the same in 3 years
15% value drops considerably (10%+)
40% value drops

read curbed, downtown who poats here has a god blo and lots of info.
walk around- pick up the local paper, talk to people, talk to store owners, talk to brokers (yes brokers). and listen... i have noticed you respond to every post. you asked peoples thoughts and then respond back..
if you want to learn.... listen, take in all in and determine what is right for you.
not for the anonymous posters on a blog
good luck!!