Better than any stock market in the world, for an asset that produces not income: http://www.streeteasy.com/nyc/sale/363264-condo-99-jane-st-west-village-new-york 99 Jane 6L: $1,895,000 Sole in May 2004 for: 99 JANE STREET 6L Manhattan 5/6/2004 $1,125,000 Too bad incomes didn't go up 68% in 4.5 years. Of course to buy it with a standard mortgage would cost: Down Payment: $379,000 Mortgage Amount:... [more]
Better than any stock market in the world, for an asset that produces not income:
http://www.streeteasy.com/nyc/sale/363264-condo-99-jane-st-west-village-new-york
99 Jane 6L: $1,895,000
Sole in May 2004 for:
99 JANE STREET 6L Manhattan 5/6/2004 $1,125,000
Too bad incomes didn't go up 68% in 4.5 years.
Of course to buy it with a standard mortgage would cost:
Down Payment: $379,000
Mortgage Amount: $1,516,000
Mortgage Payment: $10,600
Total Monthly Payment: $12,313
Which increases as the tax abatement amortizes.
To rent an identical apartment would cost $6,500 (which they can't even get).
http://www.streeteasy.com/nyc/rental/425351-condo-99-jane-street-west-village-new-york
Real estate has NEVER increased that much that fast. Watch for a 50% decline.
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Response by anonymous
over 17 years ago
I do hope that prices drop 50%, I'd pick that place up at $1MM, definitely.
Steve, your calculation misses either or both of a tax deduction on the interest expense and the principal that is being applied in the mortgage to the equity ownership of the property. Certainly you are correct in pointing out the pure cash flow differences.
Ignored comment.
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Response by jgr
over 17 years ago
Posts: 345
Member since: Dec 2008
It also misses opportunity cost, insurance, repairs, closing costs, brokerage fees when you sell, etc. The price is out of whack, that's the point.
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Response by stevejhx
over 17 years ago
Posts: 12656
Member since: Feb 2008
You're both right. On the whole, over the long-term, those costs tend to offset each other.
Don't forget mansion tax & mortgage recording tax, conveyance tax and capital gains (loss in this case) tax when you sell.
I do hope that prices drop 50%, I'd pick that place up at $1MM, definitely.
Steve, your calculation misses either or both of a tax deduction on the interest expense and the principal that is being applied in the mortgage to the equity ownership of the property. Certainly you are correct in pointing out the pure cash flow differences.
It also misses opportunity cost, insurance, repairs, closing costs, brokerage fees when you sell, etc. The price is out of whack, that's the point.
You're both right. On the whole, over the long-term, those costs tend to offset each other.
Don't forget mansion tax & mortgage recording tax, conveyance tax and capital gains (loss in this case) tax when you sell.