Some background facts: bought a 1-bedroom UWS luxury condo on Riverside Blvd in 2006 when the market was near its peak, the apartment has been rented out for the past 8 years. Due to high HOA and mortgage which the rent doesn't fully cover, the monthly carrying cost of the rental is about $1100. Missed a great opportunity to sell for a 200k profit in 2016, since 2017 prices have gone down quite a... [more]
Some background facts: bought a 1-bedroom UWS luxury condo on Riverside Blvd in 2006 when the market was near its peak, the apartment has been rented out for the past 8 years. Due to high HOA and mortgage which the rent doesn't fully cover, the monthly carrying cost of the rental is about $1100. Missed a great opportunity to sell for a 200k profit in 2016, since 2017 prices have gone down quite a bit, many comparable units in the same building sit for months before they sell at a reduced price. Based on how similar units are selling, most likely will have to to sell at a reduced price and a meager $100k profit based on the current market.
Contemplating if I should list the apartment and try to sell this fall when tenant vacates (the main concern would be a potential carrying cost of $30k or more if the apartment sits empty while trying to sell)? Also considering the possibility of renewing the lease for another year then sell (the main concern is that the market will go down further in a year due to the new tax law and rising interest interest rates, making it even harder to sell)?
Would appreciate thoughts and input!
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Response by front_porch
over 7 years ago
Posts: 5312
Member since: Mar 2008
Why don't you try to sell this summer while the tenant is in place and there's furniture there? You can negotiate with (and frankly pay off) the tenant for the inconvenience. No one has a crystal ball as to what the market is going to do, but you do know that the Fed is further talking about raising rates, so that's a headwind that argues against holding.
There are larger contextual factors about how you would redeploy the money and what your long-term goals are, but absent knowing those answers, the above is what I'd recommend.
ali r.
{upstairs realty}
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Response by throughoutuws
over 7 years ago
Posts: 2
Member since: Jun 2018
thank you for your thoughts-- it is difficult for me to list the unit this summer because i won't have access to showing it for 2 months, the tenants are spending the summer abroad and have refused permission to access the unit while they are not around. if i list the apt after tenants vacate in September, should I brace for a slower season ahead with fewer market activities? i've heard mixed opinions about whether it is a generally a good time to sell in the fall.
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Response by CaptainOfTheGate
over 7 years ago
Posts: 78
Member since: Jun 2017
Are you factoring in closing costs in this profit analysis? Assuming you have an existing mortgage and it's a $2mm sale, you're looking at $160k+ in closing costs. Play around yourself to see what I'm talking about:
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Why don't you try to sell this summer while the tenant is in place and there's furniture there? You can negotiate with (and frankly pay off) the tenant for the inconvenience. No one has a crystal ball as to what the market is going to do, but you do know that the Fed is further talking about raising rates, so that's a headwind that argues against holding.
There are larger contextual factors about how you would redeploy the money and what your long-term goals are, but absent knowing those answers, the above is what I'd recommend.
ali r.
{upstairs realty}
thank you for your thoughts-- it is difficult for me to list the unit this summer because i won't have access to showing it for 2 months, the tenants are spending the summer abroad and have refused permission to access the unit while they are not around. if i list the apt after tenants vacate in September, should I brace for a slower season ahead with fewer market activities? i've heard mixed opinions about whether it is a generally a good time to sell in the fall.
Are you factoring in closing costs in this profit analysis? Assuming you have an existing mortgage and it's a $2mm sale, you're looking at $160k+ in closing costs. Play around yourself to see what I'm talking about:
https://www.hauseit.com/closing-cost-estimator-for-seller-nyc/
Frankly, I'm a bit surprised that the profit is that low.
Also, your lease should have provisions that allow you to show w/o any bribes payoffs imo.