So I guess I fall into that category of people who are now on the sidelines with a lot of cash. I am now considering making an investment in real estate either in NYC or outside of the area, or both. I have one question for the crowd, though. It's a serious question. Is there a NYC neighborhood where I can purchase a property and recoup most (if not all or more than) my carrying costs by renting... [more]
So I guess I fall into that category of people who are now on the sidelines with a lot of cash. I am now considering making an investment in real estate either in NYC or outside of the area, or both.
I have one question for the crowd, though. It's a serious question.
Is there a NYC neighborhood where I can purchase a property and recoup most (if not all or more than) my carrying costs by renting it out?
We obviously need to take into account:
- purchase price inclusive of all closing costs and fees
- interest expense on mortgage (need to look at this on a pretax basis if doing the buy-then-rent analysis)
- foregone interest on a down payment (assume 20-30% d.p. for an investment property, assume 4-5% risk-free opportunity cost)
- actual market rents in the neighborhood (not the ask)
- all other costs (maintenance, taxes, insurance etc.)
I'm interested in specific examples citing (i) a specific property for sale and (ii) actual market rents for similar properties in that neighborhood. Responding with "LIC!" or "LES!" isn't terribly helpful.
I'm very much looking forward to any examples.
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yuck, stay out of the Bronx and don't buy that building. You will get a bunch of deadbeat tenants.
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Response by farquhar
almost 18 years ago
Posts: 124
Member since: Jun 2008
Thanks jrd. Yeah, but it's hard to get excited about the prospect of being a Bronx landlord.
So, let's focus then on neighborhoods in Manhattan and brownstone Brooklyn.
Any examples at all? Is it at all possible to find a property (single residence or brownstone) where one can rent and cover their all-in costs?
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Response by joedavis
almost 18 years ago
Posts: 703
Member since: Aug 2007
no i dont think it is possible to buy something and rent it out in the hope that the rent will cover your mortgage at current rates
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Response by Tony
almost 18 years ago
Posts: 140
Member since: Feb 2008
Can you deduct mortgage interest if you are renting it out?
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Response by jrd
almost 18 years ago
Posts: 130
Member since: Jun 2008
I'm with joedavis; You can't do this in Brownstone Brooklyn or Manhattan. Which is why I sent you to the Bronx earlier :)
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Response by totallyanonymous
almost 18 years ago
Posts: 661
Member since: Jul 2007
-why would you people do this guy's job for him? OP's trolling for free investment advice. Do it yourself like the rest of us buddy.
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Response by petrfitz
almost 18 years ago
Posts: 2533
Member since: Mar 2008
I agree agree with totallygay i menat totalyanonymous - if you have to ask how to do it, you shouldnt even be considering hte business.
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Response by totallyanonymous
almost 18 years ago
Posts: 661
Member since: Jul 2007
Petrofitz. I though I told you I'm a married guy (although i am sincerely flattered). XOXOXO ; )
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Response by east_cider
almost 18 years ago
Posts: 200
Member since: Feb 2008
Hey Pete,
Maybe this isn't the forum, but I read that your Lake Las Vegas community declared bankruptcy. They are going to cut spending on amenities and services. Do you think this will affect the value of your home there?
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Response by petrfitz
almost 18 years ago
Posts: 2533
Member since: Mar 2008
east cider please post a link.
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Response by east_cider
almost 18 years ago
Posts: 200
Member since: Feb 2008
Yesterday's WSJ, section B
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Response by petrfitz
almost 18 years ago
Posts: 2533
Member since: Mar 2008
east cider - it could hurt my value - remember I have already bought close to 50% off last years market - $1.4 for a $2million property with all upgrades thrown in on top.
I have always said that I did not buy this an investment and would not be hurt if I lost all the money I put into it. I do think that when the market turns around in Nevada this area will come back quickly.
I bought it because I am in Vegas often for business and therefore write off everything concerning the house as an expense, and I also love having a private lake out my back door and lake Mead out my front door.
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Response by east_cider
almost 18 years ago
Posts: 200
Member since: Feb 2008
Fair enough.
I must say, it takes some rocks to write off *everything* related to a second home as a business expense! I didn't even know one could do that. I must be unlucky - I write off a $100 gift to United Way and the IRS helicopter lands in my front yard.
Here is a building with a cap rate of 7.6%:
http://www.masseyknakal.com/listingimages/setup/pdf/1243webster.pdf
Can you finance this property for 7.6% or better?
yuck, stay out of the Bronx and don't buy that building. You will get a bunch of deadbeat tenants.
Thanks jrd. Yeah, but it's hard to get excited about the prospect of being a Bronx landlord.
So, let's focus then on neighborhoods in Manhattan and brownstone Brooklyn.
Any examples at all? Is it at all possible to find a property (single residence or brownstone) where one can rent and cover their all-in costs?
no i dont think it is possible to buy something and rent it out in the hope that the rent will cover your mortgage at current rates
Can you deduct mortgage interest if you are renting it out?
I'm with joedavis; You can't do this in Brownstone Brooklyn or Manhattan. Which is why I sent you to the Bronx earlier :)
-why would you people do this guy's job for him? OP's trolling for free investment advice. Do it yourself like the rest of us buddy.
I agree agree with totallygay i menat totalyanonymous - if you have to ask how to do it, you shouldnt even be considering hte business.
Petrofitz. I though I told you I'm a married guy (although i am sincerely flattered). XOXOXO ; )
Hey Pete,
Maybe this isn't the forum, but I read that your Lake Las Vegas community declared bankruptcy. They are going to cut spending on amenities and services. Do you think this will affect the value of your home there?
east cider please post a link.
Yesterday's WSJ, section B
east cider - it could hurt my value - remember I have already bought close to 50% off last years market - $1.4 for a $2million property with all upgrades thrown in on top.
I have always said that I did not buy this an investment and would not be hurt if I lost all the money I put into it. I do think that when the market turns around in Nevada this area will come back quickly.
I bought it because I am in Vegas often for business and therefore write off everything concerning the house as an expense, and I also love having a private lake out my back door and lake Mead out my front door.
Fair enough.
I must say, it takes some rocks to write off *everything* related to a second home as a business expense! I didn't even know one could do that. I must be unlucky - I write off a $100 gift to United Way and the IRS helicopter lands in my front yard.
east cider its my 3rd home not second.
3 homes?