To all those people who own houses: How did you do it? How were you able to buy your first one? (If you wish to remain anonymous, I am OK with that. Use a fake name if you leave a comment.)
The house you see above is for sale in our neighborhood. It was listed at 700 thousand dollars. The advertisement read: “Needs to be gutted and entirely redone.” Don’t worry, even if I had the money I wouldn’t buy this house. But every time I see something like this, I can’t help be become more and more discouraged about ever being able to afford a place of our own. Here’s our dilemma: If Tobyjoe wants to keep his job (which he really likes) it means we have to live in or near New York City. We can’t afford to live in Brooklyn. In order to do so I would have to get a job making at least 65,000 dollars a year and we’d have to pay someone to raise our kid. (Call me old fashioned, but I don’t feel right about working 60+ hour weeks just so I can pay someone to raise my son.) We certainly can’t afford Manhattan. Upstate New York is an option but we’d have to go pretty far out to afford anything. And if we do that we run the risk of raising a child who never sees his father because he’s commuting all the time. Jersey is an option we’re looking into, but houses are still quite pricey and taxes are high.
I took a walk today to get some decaf coffee from my new favorite bistro, which is located on Driggs right before Driggs crosses Manhattan Avenue. I took my camera with me to try and capture the number of massive developments going up in a very small area.
(Descriptions are above each picture.)
A sliver from a map of Greenpoint. The red stars represent buildings that are already occupied or buildings currently being erected. The yellowish stars are those to come. (Meaning, they are currently applying for permits, being bulldozed, etc.)
See number 1 on the map above. The building shown below is the most perplexing of all. The top floors not only have a view of BQE traffic but its inhabitants get to inhale the toxic fumes from it as well. The bottom floors get to see underneath the BQE where the car service guys hang out 24/7, the crackheads get their fix on, and the trash piles up like filthy tumbleweeds.
Pricing: Here is the building. Cheapest unit is listed for $249.000, most expensive is $389.000.
See number 2 on the map above. OK, so the building below is one of the first and it’s pretty tame considering. We were kind of intrigued by this one at one point because the roof deck looks amazing. Plus, I think at the time we moved in it was still affordable.
See numbers 3 and 4 on the map above. I have a huge crush on the one on the right. (Yes, you may not be able to see it here, but these are two separate buildings.) Anyway, I dreamed of having a place there because it overlooks the park. There isn’t a chance in hell that the city will give up that view to another developer, which also explains why the prices in this building were so high. (I used “were” here because they sold out in seconds so I’ve been told.)
Pricing: 297 Driggs Avenue: The building features one-bedroom units starting at $569,000 and two-bedrooms with private outdoor space going for up to $1.1 million. Twelve of the 14 apartments will have balconies overlooking McCarren Park.
See number 5 on the map above. They put up permits recently and the businesses that were once there have moved out. So now the folks who purchased a place in either of the two buildings I showed previously will lose their back views.
See number 6 on the map above. This building is pretty modest. They also have killer roof decks. They sit directly across from the park. I envy a lot of these people for that very reason.
See number 7 on the map above. Going up on Eckford and Manhattan Avenue. Found this blurb about pricing:
Pricing: “The 32-unit luxury building by Tahoe Development contains 28 two-bedroom rentals going for $2,500 a month, and four duplex penthouse condos asking $1.2 million each. Occupancy is scheduled for fall 2006, the Post reported.” (The Real Deal.)
See number 8 on the map above. Lots of windows on these guys. They kind of look like beach condos to me. Not sure why.
Pricing: “49-61 Engert Avenue: Traditional two-bedroom units from $649,000, two-bedroom garden duplexes from $725,000 and three-bedroom penthouse units starting at $955,000. Slated for occupancy in December, the building has already sold 19 of its 24 units.”
See number 9 on the map above. To be honest, I didn’t’ even know these were being built. There are so many of them, I must have gotten them confused with another.
See number 10 on the map above. Again, didn’t know about these and they are a few blocks from where I live.
See numbers 11 and 12 on the map above. I didn’t walk all the way over to these two. They are monsters overlooking McCarren Park. They are a bloody fortune so I’ve been told. Last Thursday, someone had rented a giant spotlight to lure the eye of the masses – the rich masses of course.
See number 13 on the map above. This is a 13-story condo being erected in our back yard. Our evening sunsets are a thing of the past. I don’t know who would want to buy a place that costs so much and has a view of the BQE on ramp. No idea how much these will run. The space is entirely too new.
See number 14 on the map above. Not a great shot because (as you can see) I was in the middle of the one of the deadliest streets in Brooklyn. But these monsters are going up on the other side of the BQE.
If anyone out there knows the exact prices of the condos shown above, please do share them. I will try and find the information out on my own, but I get a little overwhelmed with this sort of thing. I am not even sure where or how to begin looking for that type of information. (I found some, not all, but some.)
how? We don’t live in nyc. We bought our house 7 years ago for $89,000.
move here!
Unless you are an investment banker, I have no idea. Just move to Columbus. We bought a 1900+ sq. ft home in metro Columbus for under $150K. This what you can get in the same neighborhood for under $400K – http://her.realliving.com/Property/Details.aspx?PropID=5638154
Dear Mihow: I read and lurk all the time but felt compelled to write today because this is a tough subject. Nine years ago my husband and I bought the house we live in now, which is lovely, but home ownership requires maintenance and that takes money and it seems like we spend a lot of time trying to keep on top of finances. It is worth it, though.
How did we do it? We scrimped and saved and borrowed $10,000 from my parents and at last had a downpayment. We didn’t eat out, I stopped buying nice clothes (I had enough, really), we didn’t take trips beyond camping or a day’s drive to stay with friends or relatives. We stopped buying fancy gifts for others and we packed a lunch each and every day. It was not the huge sacrifice it sounds like; it just required us to live differently than we did as single, money spending people. The loan from the parents was key – it was interest free – and helped us get the downpayment. We paid it off in two years and by some miracle, never missed a payment to them.
If you borrow money from relative, you can list them as co-owners or proportional owners if you like (or they want). In our case, my parents offered to make us the loan as “silent partners”. I know people whose parents are proportional owners (when the house is sold, they get their percentage of the investment back). I have also known people whose parents supplied the downpayment and the peopel made the monthly payment. At sale time, they settled up. In all cases, it worked out well. But I think it requires a good relationship with your family!
Nowadays you can get loans for almost the entire amount of the mortgage, but that is a dangerous territory. The downpayment is instant equity, if you will, and you need that right away, so try to get 15 or 20 percent downpayment if you can. Full-amount loans usually come with weird, sub-prime mortgage strings attached and you DO NOT WANT to be anymore beholden to the bank that you will with a traditional mortgage.
Also, you can probably get by with less square footage than you want. Your friends will be amazing people who help you with tile work and plumbing and landscaping. You will be amazing people to your friends as you help them install new windows, etc.
And the lifestyle of lunch-packing, cheap DVD renting and never going out lasts a few years after the purchase. The upside is that you can thow dinner parties and your guests can sleep in the guest room or on the couch if they’ve had one too many.
In summary, it’s hard but worth it if you can manage it.
Best of luck and I’m anxiously awaiting the arrival of the baby!
My mother in law died leaving us around 130 ooo dollars which we used to put down on our house. In Canada if you put down 25 % you get to have a mortgage without insurance which is cheaper.
I always knew that someone would have to die for us to buy a house. Morbid but true.
M
We were lucky. Our fiance purchased out here when things weren’t quite so frighteningly high. However, now that we are two, plus three cats, the house feels small. What’s amazing is that both of us have good white collar jobs and we too are looking at 700 grand for anything larger (so not quite what you are going through). I don’t know how people do it.
We’d have to be an hour commute from my fiance’s job to get a larger house. We have land here, fortunately, so we can build an addition.
I am frightened for people who don’t have some sort of real estate already because I don’t know where prices are going. I don’t know who is buying those houses or how they do it!
700k and needs to be gutted and redone? what the hell? i guess it goes without saying, but that’s fucked up.
to answer your question, when you live ‘out here’ it’s pretty much as easy as picking a house and getting a loan.
i’m sure you two will find something that works. for what it’s worth, i bought tobyjoe’s PHP5 book… so the royalties from that should totally cover your down payment, right?
We live in SLC, UT where the housing market isn’t insane. A bit crazy, but not outright insane as you describe.
We had a bit of help with the down payment from my wife’s folks.
I’m clicking on one of your google ads. That’ll help, right? :-]
Sadly, no royalties from that book. :[ He got a flat sum and most of that went to the IRS, which is where all of our money seems to go, quite honestly.
Thank you all for the thoughtful responses thus far. I am currently adding to this post and will add more of my thoughts here in a few minutes as soon as that finishes up.
Oops, my response was to Chris.
Jon, I would move to SLC in a second if family lived out there. In a damn second. Although, and hopefully this doesn’t make you mad, that many Mormons freak me out. ;]
Buying a house or trying to buy one can get depressing. We had bought our first townhouse/house purchase when we lived back east. I really wanted to live in DC but we just couldn’t afford anything where we wanted. We ended up in suburbia hell, a.k.a. Centreville, VA. Yeah we had a big place but I really missed the city.
In order to get that place, which when I look back upon it, was really cheap, we had to save just as the other people mentioned in the posts above. I think we also sold some of the stock we had to get the $$. We thought we were living large until we moved out here to S.F. I totally hear ya about the insane prices for little places. My parents bought a place outside of Pittsburgh for 170K. They have 5 bedrooms and 6 bathrooms. I had to laugh b/c for 150K out here you couldn’t even get an outhouse let alone an empty lot. We are seriously considering moving out of the city to find a bigger place as we are tripping over each other here. But the sad part is is places outside of SF are more expensive than in the city! Unless we want to go to East bay, that is out of the question for us….
At any rate, they way ya gotta do it is by saving those pennies…It is hard but very much worth it in the end.
Good luck!
yeah, sadly, every time we have a savings, we give it to the IRS (this past year, Toby wasn’t being taxed enough. BIG MISTAKE and our own. But we hope that his employer has now solved that problem) This year, we dumped another big chunk of our savings into trying to save our cat. Sadly, that outcome was not what we would have wanted, but I wouldn’t have seen it any other way. He was a part of our family and if anyone gets all “priorities, Michele!” I’ll punch you in the face.
We don’t take expensive vacations and I don’t buy a bunch of crap I don’t need. In fact, most of what I wear as of late are maternity hand-me-downs.
We’re back to square one now that our vet bills are paid down. Hopefully, we’ll be out of here in a year.
It always amuses me that you seem to post about stuff like this the day after Mike and I have long and involved talks on the subject. :) And I hear ya about the IRS. Freelance income can be a killer.
Re: housing, I don’t know that we’ll ever be able to buy in this area, but we’re pretty sure we’re not ready to leave it yet. We’re planning to sign up for a zipcar this summer and spend some time driving around to parts of the state that are still within commuting distance to the city and check out our options. I think mostly we are tired of having our neighbors right on top of us (and on either side) all of the time. Most of them are great, but still… a little breathing space would be welcome.
I feel your pain. We’ve started looking at buying in the Bay Area, and we need at least half a million dollars to get something small in a non-murdery area of Oakland. It’s hard and disheartening and the only solutions seem to be (a) move away, (b) find a wealthy benefactor, or© win the lottery. Even though I have family in SLC, I still wouldn’t move back there, though… :)
Wow, Oakland is that costly now? I had no idea! It seems to me that SF and NYC are very similar in that it’s becoming more and more difficult for the middle class to live in either city. There are a few places in Brooklyn that go for 350 (granted, I haven’t looked for almost 2 years) but they all seem to be 350 square feet and there’s a waiting list for the ones that are near decent public schools!
We were in SF for about 6 months and then took off for the East coast. I did notice that while we were there there’d be no chance of us ever being able to buy a place. I’m starting to think that if you didn’t get something about 5 years ago and are therefore invested, you’re kind of f*cked now.
My advice would be to find a really good mortgage broker. One that can give you lots of different types of mortgages from different companies. We were really fortunate to find one in VA. He was able to look at our finances and suggest the range that he thought we should look in. That way when we found something we were ready to make an offer. Plus, he didn’t over-qualify us. Sure, we could have afforded more but who wants to be sitting in a bigger house with no food or furniture?
There are a lot of mortgage options out there especially for first time buyers that don’t involve as much down. Since in most parts of the country it is becoming more of a buyer’s market, you might look at something that involves less money down and mortgage insurance. Then in a few years when the market swings the other way you can use your equity to refinance without the insurance.
You can buy a apt/home with no money down/little money down in NJ. A friend recently did that in Jersey City.
We found apartments is Coop Village cheaper than Brooklyn (and bigger), they are not new but they have nice layouts and being near the east river is great.
Have you thought about Metuchen or is that too far out? Rob and I really like it. We like the little downtown area. Plus, it has a NJ Transit stop.
I don’t think the home buying thing needs to be as depressing as you make it sound. We just bought a house on the border of Clinton Hill and Bed Stuy, which basically needs to be totally redone, and cost a decent chunk of change. But then, we didn’t want to pay an extra $400k for somebody else’s crappy renovation, or worse yet, flip. I actually think it’s going to be a lot of fun restoring the place.
Anyhow, the best way to stay in the city and eventually own a house or townhouse, is to buy an apartment now. If you can be a decent student of the Brooklyn RE market, i bet you can find a 2BR or 3BR that will last you at least 2-3 years and appreciate over that time. Not to mention the fact that you won’t be giving your $ to a landlord, but instead be building equity. Don’t be fooled by looking at prices from 5-10 years ago and thinking ‘it was so much easier then.’ I’m sure it wasn’t. And most likely, 5-10 years from now, people will be wishing they bought when you did.
Anyhow, the only way to succeed in ‘the system’ is to jump in.
oh, and you can find out who is deveolping any of those addresses by looking them up in the DOB:
http://www.nyc.gov/html/dob/html/bis/bis.shtml
A lot of the developers around here actually sell units before they’re even done, so you shouldn’t have too much trouble tracking down prices.
Melhow: Metuchen is on our list for sure. It’s not far at all. Totally doable and I too like the area.
The thing with buying in NYC is I want a little bit of outdoor space. I don’t want a super small one or two bedroom apartment in the city where I have to get clearance from some Coop board or pay maintenance fees. I guess, what I’m saying is this: I don’t want to stay here and own a place. The next time we move I want it to be outside of the city where I can get some room, possibly a yard, and not have to cater to some coop.
littleruse: Where is that hood? I never heard of it!
Thanks for the link, Keith. I did find some pricing and as I expected the cheapest (besides the one that’s basically under the BQE) run 600 thousand and up. most are being sold for a million and more.
(I added the links and blurbs to pricing on some of them if you’re interested in seeing the amount.)
Wow. I can’t get over those prices. Just… wow. Here I was feeling sad that we can’t currently afford a 3 bedroom, 1800 sq. foot house – for $110,000 in our market. I hope you can luck out and find a diamond in the rough. And you should really look at various financing options – they can get pretty creative with it these days (but beware of some of the scammy interest-only deals!).
LL: I fixed the cross out problem. It’s because this site uses Typo and double dashes which are usually used to make em dashes (right?) cross out the type. :]
I wish there were some way to fix that.
Everyone: Thanks for the feedback on how this is done/how you’ve done it. When we manage to save some money, we’ll first meet with a broker and work from there. Depending on how much we save, we may have to take one of those 80/10/10 kind of things. (Look at me try and pretend I know what I’m talking about) Who knows. All I know is there is no way in hell Toby and I can save 70 grand in order to buy here. We just don’t make enough to do that and pay our rent and everything else.
So, it’s off to the burbs for us. :] But that’s OK.
Okay, what I don’t get about most of these buildings, is that on the ground floor, the windows are squished right up against the sidewalk. Don’t people look in all day??? The highrises (and lowrises) around here always have commercial property on the ground floor if they are near roads and sidewalks.
We live in the most expensive city in BC, but I guess because we have so many suburbs, it’s a bit more affordable. We bought our house a month after we got married (in 2003), and used most of our wedding gifts that came in cheque form to pay for the downpayment. We managed 10% down, and got more house than we thought we could afford. But in 4 years, it has doubled in value, so we’ve gained a lot of equity. I do commute nearly an hour to work however. My husband only has a ten minute drive, he works out in the boonies out here.
You guys should probably just call a mortgage broker and see what they’re willing to loan you. That should shed some light on all of this, and it costs nothing but a little time…
So don’t buy a house. What’s wrong with renting? I mean, I know dozens of people who lived in New York in their 20s, and then when they wanted to have kids and buy a house, they moved somewhere they could afford. Sure, the jobs probably aren’t as rad, but everything’s a compromise.
PS: don’t get ripped off by creative mortgage brokering. Do your homework. xo.
Well, Tobyjoe is sick of paying someone else’s upstate mortgage, which is exactly what we’re doing now. Plus, they raise our rent 10% each year, which is a lot of money. (We’ve been here three years and our rent has gone up substantially in that time.) Also, word on the street is they are selling the building next year, which means we have to get out and rent in this area has risen too high for us. (Did you see the above apartment rental? 2500 bucks a month. I don’t think so!)
It seems that everyone on this block is starting to sell or consider selling. I think people are upset about the 13-story condo building going in. If I owned this place, I might sell it now as well. :[
I wish we could afford to stay here, I could raise our boy, and send him to a nice public school, but I don’t think it’s feasible at all. So, we’ll head to Jersey in time. Or maybe New England. Who knows. For now, I just want to have a healthy baby! :]
Need some extra cash? You could sell cookies. :)
I just remembered why I live in the Midwest. Boring but cheap!
StFarmer, my cookies are baked full of love! Free of charge! To all those who are awesome. ;]
The Midwest is cheap, isn’t it? My friend, Gina, said they bought a place in Detroit for pennies. But that’s so far from family. Bummer.
With the money you save in the midwest you could fly back to the right coast every weekend.
i don’t have any useful advice for you, but i get a kick out of this blog on brooklyn real estate.
http://brownstoner.com/
I’m not sayin’, I’m just sayin. But toby doesn’t ACTUALLY have to live in New York to keep his awesome job. He can move to the 2nd or 15th most expensive city instead!
Aww Rick… though what you say is true, it wouldn’t be my favorite thing to have toby and michele off in some distant place. ;)
awwwww, I feel the love.
I think we’re going to look to Metuchen. I have a buttload of relatives who live there. That way we can drop the kid off and go out partying! Woo!
houses for sale in the southside of pittsburgh are going from 50 thou and up, walking distance to everything……….but nobody wants to live in pittsburgh ; )
it’s a buyer’s market right now! unless you’re trying to buy in NYC on a normal human’s income i gather! yikes those prices are rediculous!
good luck! shop around, there are creative ways to finance, i got a 103% mortgage…..my interest rate was higher than normal(6.75% at the time) and i have to pay mortgage insurance (50$ a mo.) but it’s worth it because i plan to sell in a few years when i build for myself.
good luck…..my advice is keep renting for a few years, but possible in a new location……why? well……
…… once you own, and especially something affordable(i.e. older home) around 15 years is when the wheels start falling off. my house was 76 years old when i bought it so you could imagine the state it was in. the previous owner died on the shitter! after the exorcism, i went to work gutting the place. doing the work yourself is both rewarding and cheap! so be ready if you decide to buy……it’s scary and fun and not the end of the world, but take the time to educate yourself on as much as you can and shop areas as long as you can…it’ll pay off
man, it was a hard decision, but joe and i decided to rent for another year, mostly because the real estate market in this area is still on the down slope and i would hate to look back and feel like we got ripped off a couple of ten thousand dollars. you can usually find a pretty good loan if you have great credit and between 10-20% down and pay your fees up front.
we squished into a home half the size and pay $50 more a month in rent just to live in the same area as my ex. i seriously can’t wait to buy next year.
It’s coming up with that 10-20% that seems impossible to do while paying a high rent. That’s why I am convinced that many of the people who are buying here are either getting the money from their family members or are using bonuses to pay it. Even 10% of 600 grand is 60 thousand dollars. That would take us probably 5 or more years to save for. Then again, I haven’t actually done the math.
All of that is why we are going to have to leave here and find something for half that. We can probably save up 30 grand if we move into a cheaper place. I hope.
Oh, and Greg, I would totally live in the Burg if there was a job there for me/us. Maybe I’ll look! :]
Thank you, everyone, really, really for all your help.
the biggest problem with the burgh is, the people are friendly and hard working while the real estate is cheap and taxes are fairly low while the cost of goods and services are quite reasonable……i hate that! ; ) seriously though, the city has a bit of everything, but when i say “a bit,” i mean it! pittsburgh is really just a large town. you’d probably suffer culture shock for the first two years here. hehehehe….i know i did!
michele-
i think the problem is that wb/greenpoint used to be a working class community, but people are rapidly trying to turn it into a luxury zone.
over the past 4 years, the housing in this area went up 10-20x ( in percent that is 1000-2000%)
all of the buildings that have 10 400-800k condos in them are going up in lots that cost ~100k. in 2001, you could get a 3story building in williamsburg greenpoint for 120k. in 2003, it was 240k. the day after rezoning that number shot to 1.5million +.
the people who are buying these new condos are mostly either getting it paid for by family members, or are the same people who have been paying 3-6k a month in rent in manhattan.
Jonathan, thank you so much for the information. I was wondering where you went and figured if you were still around you would have some information on the current situation. Check out This set featuring other monster condos miss heather of New York Shitty created. (Another Greenpoint dweller.)
I’m working at home non-stop. Picked up 2 biz partners and we’re trying to get funded and relaunch FindMeOn. I sadly don’t have time to read blogs much :(
But I had some spare time earlier and saw this… WB real estate has gone completely insane. i think more so than the rest of NYC, for the simple fact that in wb they are actively razing middle class housing and jobs to make million dollar condos. the ‘abandoned warehouses’ argument is bs—the bulk of the buildings were purposefully abandoned by landowners in preparation for rezoniing. residential leases are for 1-2 years, but commercial leases are for 5-20years ( you have to invest so much more into the building if you’re running a warehouse or bakery , signing for anything less than that makes no sense. ) when the prospect of rezoning came up, landowners stopped renewing leases, because they wanted to flip properties as soon as rezoning takes place. when rezoning happened, then they started getting aggressive and evicting people.
i live across the street from an ‘abandoned’ factory
– it was in full operation 4 years ago. 2 years ago 1/2 the tenants got forced out when their lease went up. last year the rest got eviction notices and their locks changed. why? because you can sell a vacant building for way more than one with just one occupant. about 10 months ago, area banks redid the loan rates to developers –they upped the requirement to soemthing like 35% down payment if you’re in the wb area ( this isn’t for people who buy an apt, thats still 5-10% down– this is for financing delvelopment 0. it was because of all the overdevelopment. thats why you’ve seen so many blocks torn down, but construction happening slower –the developers are snatching up buildings and tearing them down ( lower taxes on empty lots, and you might as well demolish now before prices go up ) , but don’t necessarily have the money to complete the job.also note: a lot of the apartments are bought on speculation. some people will buy 2-4 condos as investments , and either let them just lay there until someone wants to buy at a profit, or rent them out. a lot of the first wave of buildings had to turn into rentals direct from the developers, when no one would buy them.
all this had made me sick of ny. the city council was outright bought by the developer lobby: gifford miller funded 70% of his mayoral campaign off of WB developers; marty markowitz gave the architect scarano a ‘brooklyn icon’ award in a secret ceremony
– despite outrage that his buildings all violated city codes and had a habit of collapsing on contruction workers; even the local rep yassky is funded mostly by the area developers –he even had a clandestine fundraiser by scarano and one of the other developers that he had to backpedal when the blogs picked it up.nyc needs more housing, but it needs varigated housing—the rezoning plan does nothing but raze middle class housing for luxury units.
when i have a family, i don’t want to raise kids in a community that is polarized between the ultra-rich and ultra-poor—and thats exactly what NYC is going to be in 10-20 years.
Personally , I think you and Toby should make the most of NYC now and get the hell out when your kid is ready to start school.
Metuchen…I don’t know anything about that town, but if you will be near relatives that will babysit, that is worth it’s weigh in gold!!!!
We took out a loan on my 401K to get our first house which was only $117 in the suburbs of chicago and it appreciated to $240K then we couldn’t sell it and now my BIL is renting from us and we were able to use my hubby’s annual bonus as a downpayment for our current house. You can get a good deal on a mortgage if you have decent credit and a fannie mae loan w/as little as 3% down..then you’ll have to pay PMI…but starting in 2007 PMI will be deductible.