Greetings, it has been a long time since I have been on! I have owned my 1 br coop in a prime EV building (not the A building for those who are wondering) for a little over 3 years. We are planning to move in about two years, when my baby turns three years old and when we will be five years in. If I have to sell at that time, though I'd be rid of the coop, I know chances are pretty much zero that... [more]
Greetings, it has been a long time since I have been on! I have owned my 1 br coop in a prime EV building (not the A building for those who are wondering) for a little over 3 years. We are planning to move in about two years, when my baby turns three years old and when we will be five years in. If I have to sell at that time, though I'd be rid of the coop, I know chances are pretty much zero that I would even be close to breaking even since yes, I bought in 2007 at the peak. If I sublet, which is allowed, I would get the mortgage + a bit of the maint covered, but still have a gap of about $500/month.
My parents (long time RE investors in NYC who have done quite well fwiw) are advising to hold on even if it takes a decade to break even/make a profit. I did the math, $500/month for 5 years is $30K.
I have savings, which though I never touch, technically I could use if I had to to fill the monthly gap. But I am wondering if it is better to hold on or just sell in 2 years and be rid of the thing and all the stress of "what if the market keeps going down?"
WWYD? (and I do NOT need snide comments or labels of "lemming" or "sucker" or any of that, thanks in advance)
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Response by gcondo
about 16 years ago
Posts: 1111
Member since: Feb 2009
rent it for two years and then dump it and take 100% of the loss against income. call your accountant though, lol.
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Response by gcondo
about 16 years ago
Posts: 1111
Member since: Feb 2009
oh and refinance if it makes sense.
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Response by w67thstreet
about 16 years ago
Posts: 9003
Member since: Dec 2008
your parents lived through the greatest boom in nyc re and made a ton of money... if they are so sure, maybe they should buy you out, and let them use it as a pied? Or even better, let them cost average down with your unit?
Imagine if you will, goldman sacks giving advice to buy gold but are unwilling to make a market for it?
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Response by technologic
about 16 years ago
Posts: 253
Member since: Feb 2010
well, they also lived through the prior bad cycle (80s/90s). in fact my dad to this day talks about selling coops for something like $135K because he thought the downturn would never end, but it did and they went for far more than that and now he regrets it. he is more of the "look honey its all a cycle, what goes up comes down and vice versa etc just wait it out. im not worried."
but someone tell me more about taking the loss against income - how can i do that? that would be lovely.
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Response by gcondo
about 16 years ago
Posts: 1111
Member since: Feb 2009
an investment property loss can be deducted 100% in the year of the loss, or carried over I assume if the loss exceeds income. This is from my CPA regarding my own investment property situation.
To qualify as an investment property for tax purposes --- check on that.
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Response by technologic
about 16 years ago
Posts: 253
Member since: Feb 2010
Good tip, thanks gcondo!
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Response by w67thstreet
about 16 years ago
Posts: 9003
Member since: Dec 2008
this ain't like you daddy's cadillac (nyc re bubble)... the key is he sold and cflowed into a better investment in the future... beware the selection bias from winners......
still check with a CPA on what it takes to qualify your primary residence as an investment property.
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Response by alanhart
about 16 years ago
Posts: 12397
Member since: Feb 2007
Tread carefully, for real estate investments don't have all the tax hanky-panky rights that other investments do. I'm not saying gcondo is wrong on this particular item, just that there are differences.
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Response by romary
about 16 years ago
Posts: 443
Member since: Aug 2008
concur with above. def refi if you can, rates are v. low.
rent it for two years and then dump it and take 100% of the loss against income. call your accountant though, lol.
oh and refinance if it makes sense.
your parents lived through the greatest boom in nyc re and made a ton of money... if they are so sure, maybe they should buy you out, and let them use it as a pied? Or even better, let them cost average down with your unit?
Imagine if you will, goldman sacks giving advice to buy gold but are unwilling to make a market for it?
well, they also lived through the prior bad cycle (80s/90s). in fact my dad to this day talks about selling coops for something like $135K because he thought the downturn would never end, but it did and they went for far more than that and now he regrets it. he is more of the "look honey its all a cycle, what goes up comes down and vice versa etc just wait it out. im not worried."
but someone tell me more about taking the loss against income - how can i do that? that would be lovely.
an investment property loss can be deducted 100% in the year of the loss, or carried over I assume if the loss exceeds income. This is from my CPA regarding my own investment property situation.
To qualify as an investment property for tax purposes --- check on that.
Good tip, thanks gcondo!
this ain't like you daddy's cadillac (nyc re bubble)... the key is he sold and cflowed into a better investment in the future... beware the selection bias from winners......
http://www.bankrate.com/brm/itax/tax_adviser/20070809_real_estate_loss_deductions_a1.asp
still check with a CPA on what it takes to qualify your primary residence as an investment property.
Tread carefully, for real estate investments don't have all the tax hanky-panky rights that other investments do. I'm not saying gcondo is wrong on this particular item, just that there are differences.
concur with above. def refi if you can, rates are v. low.