NYT Article - City of Sky High Rent

I really feel for Kimberly and Bryan Kreuzberger, it sucks that they had to get a million dollar apartment. They deserve the most sympathy.

And that poor Ms. Barrocas, she almost had to leave Murray Hill. I can't imagine.

"Kimberly Kreuzberger and her husband, Bryan, both 32, were thrilled when they first moved into their loft studio at 666 Greenwich Street in March 2009. The rent was $3,200 a month, but with the two free months they were offered, it worked out to just over $2,800. Last year, when the rent was bumped up to $3,450, they reluctantly signed on for another year. It was a lot to pay, but they loved living in one of the rare doorman buildings in the West Village. Then they got word that the landlord was planning another increase this June. The rent would rise to $3,795. ... The couple made up their minds to move; but rents for the kinds of two-bedrooms in elevator buildings they desired would be at least $6,000 a month. ... The couple settled on a two-bedroom apartment at 100 Jay Street in Dumbo, Brooklyn. They paid just over $1 million, putting 25 percent down, and recently moved in. Their monthly outlay is $4,250, which covers their mortgage, common charge and taxes."

And THIS is really the most compelling reason to BUY versus RENT: Provided that this couple got themselves a fixed rate mortgage, they are now virtually guaranteed that their total monthly housing costs will never leap more than 1 or 2 percent in any given year. And after the mortgage is paid off, their housing expenses will DROP considerably. When does that EVER happen for renters?

Re: Their monthly outlay is $4,250, which covers their mortgage, common charge and taxes."

bullsh*t. Unless their maintenance and taxes combine for a whopping $550. They're counting the tax deduction on the mortgage interest and Matt, YOU JUST SAID IN ANOTHER POST YOU CAN'T DO THAT!

Calm down, West34 -- I just took their word for it. I didn't do the math to see if they were lying.

That being said, unless they together earn a solid $350K/year, they really had no business buying a $1 million apartment (with only 25% down).

Re: Calm down, West34

your posts are always just so inspiring Matt. I cant help myself.

100 Jay St is under tax abatement, so they pay basically 0 in taxes for another 5 years before ramping up.

Your assumptions that the maintenance/property tax also stay the same, which we all know do not.

don't forget about the special assessments that come along with the purchase! try to NPV that...

NYT RE article of cse..

I stopped reading when this BS appeared, " while the city has added jobs in recent months and growth in businesses like technology has helped make up for losses in the financial sector, much of country is still struggling."

last i saw unemployment in NYC as up in Manhattan

meant unemployment is up in NYC

Not a real article it appeared in the real estate section.
Also if the average is 3148 then this includes 2, 3 and more bedrooms, and ignores multiple renters and short term leases. Basically rents have not moved that much in a decade, so why are they suddenly sky high?

whoa...

you know the answer.

starts with an i

and ends with an n

riversider, definitely agree with you there. the point that younger people have basically taken on additional roommates, whether illegally or legally. what the real indicator would be is rent per occupant, not simply leased units. i've seen some creative pressure wall configurations that probably allow 3 or more in a single 1bd/1ba apartment.

"100 Jay St is under tax abatement, so they pay basically 0 in taxes for another 5 years before ramping up."

Oy.

OK, so their monthlies WILL skyrocket because they stupidly bought into one of these tax abatement scheme buildings.

As the city copes with income tax fluctuation, increasing property tax is the only way to mitigate the volatility. IMO, property taxes will increase across the board significantly over the near term. Watch the coop maintenance and condo taxes go up incrementally 10% a yr.

So much for 'RENTING'...so who missed the housing bottom in Spring of 2009?

Check out AvalonBay..back to the all time highs.
It's almost like the housing collapsed never happened.

http://finance.yahoo.com/q/ta?s=AVB&t=my&l=on&z=l&q=l&p=&a=&c=

calm down folks, there is always Wayne, NJ..

..save now for your NJ Monthly Parking Pass, $13 bridge tolls, and higher property tax.. but you will at least get to enjoy strip mall fine dining and a commuter lifestyle with daniel staub..

i don't normally wear watches, but now i always know when my bus leaves!

"so who missed the housing bottom in Spring of 2009?"

I missed it. Shoved it all into stocks instead.

So what happened to my nominal $1M? SE index averaged 1881 back then, now it's at 1898. Crap, now have to spend $1.01M to buy the same place.

Meanwhile my nominal $1M now has $722K in gains using April 15, 2009 as the buy date. But crap, had to pay the spread between rent vs. cc & taxes for 3 years -- let's call it $2K a month (was actually less for me, but whatever). Leaves me with $1.65M.