Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
I think we lucked out because of the area and the park. I would rather be lucky then smart any day.Talk about long term investing this in realty is the culmination of decades of time.
This was not a deal like it was bought and flipped it. This was really a shot in the dark venture with elliot spitzers father bernie spitizer a long long time ago. Bernie is still our partner .
We are lucky to have done as well as we did and the fact we have the two remaining is annoying but the partnership still holds other commercial property that makes it profitable over all.
We would like to get out of real estate totally but it looks like that will not be the case as like you said these people are not motivated by money.
At 60 i am winding things down to retire and the last thing i want to do is deal with tenants anymore.
Our tenants have a greater worth then we do and we subsidize them.
As far as doing this? I think unless you do this when the building first goes through a conversion it is a huge risk.
Like jon coltrane said if there was a previous history of a landlord there is a good chance there is quite a few failed buyout attempts.
Usually you have to sell an apartment with a stabilized tenant in it for so little that it almost pays to sit with it.
Unless you got deep pockets and want an adopted family to subsidize do not do this.
Last edited by mathjak107; 01-18-2013 at 06:20 PM..
In the '90's the people who made out were those who invested in a large number of these apartments. Actuarily, they could figure on a certain number of vacancies each year with a huge return on each of those apartments and that would cover the shortfall between maintenance and rent.. So they were willing to stick with the now 100year old Mrs. Methusala or give her plenty to move to the retirement community.
But for a single investment in a single apartment the downside risk of NEVER seeing that apartment while paying for its upkeep the rest of you life is too awful to comprehend.
(Unless the $500K is atop the $500M and you are willing to throw the dice occasionally.)
i am worried , i have been agreeing with you to much lately.
the 80's and 90's were the only perfect time for this game. many many tenants had their apartments suddenly owned by sponsers. these tenants had no intentions of being long term tenants. they were just caught up in the conversions.
they were easy to buy out.
today you have only those most resistive tenants left, everyone else is long gone. that changes the odds and rules of the game by alot. don't forget most conversions took place decades ago . these are origonal tennts or in some cases their kids that are just left.
they are left because of reasons of not wanting to leave.
i like your analogy of a boat anchor ha ha ha . it won't let me rep you again for that one.
in this case the backstop is worst case scenerio she would get the tenant out by taking the apartment for herself. spending a few years in it and then sell it.
it may or may not be worth it.
Last edited by mathjak107; 01-19-2013 at 07:35 AM..
There could be a big upside if you do decide to invest in this, but it depends on your patience and how much risk you are willing to stomach. As another poster stated, you may lose money in the short term and make a bundle in the long term. Only you can tell how much is too much for you to handle.
This tenant, however old they are, may squat for the next 30 to 40 years for all you know. All the while, you're sinking money into a mortgage and paying the bank lovely interest payments.....OF which you may grow tired of and decide to sell in 5 or 10 years. Which is probably why the current owner is selling???
So you may end up with a $500k investment which may end up costing you in excess of $100k once you factor in closing costs, interest, comission and fees as well as insurance.
For me it comes down to simple math and how much risk you are willing to take. Personally, I refuse to invest in something that I will lose money in over time, especially if it's a risky investment where there are a lot of uncertainties.
I don't know your financial situation or how much of a down payment you are putting down on this apt, but unless you can stomach losing a lot of money month to
month, AND have the patience of a saint, I wouldn't do it. There are far more things you can invest your money in short term and long term, and make good gains on.
Too many people are buying into this "get rich now" mentality, without ever doing the research and due diligence. You're young and you have time on your side, be wise with your financial decisions.
Since bx revived an old post, I will add that I am very curious whether the OP decided to buy or not.
(It really would be nice when someone asks a question and gets lots of responses he would come back and tell us the resolution. Not to do so seems just plaiin rude.)
Since bx revived an old post, I will add that I am very curious whether the OP decided to buy or not.
(It really would be nice when someone asks a question and gets lots of responses he would come back and tell us the resolution. Not to do so seems just plaiin rude.)
I agree wholeheartedly and posted about that very subject yesterday. I think someone should PM the guy
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
