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the way it shakes out eventually by retirement a renter who can invest elsewhere can end up with a larger income from investments than the homeowner since eventually a big chunk of money is tied up in the house.
so the renter hypothetically would have higher housing costs from renting and higher income.
the homeowner cheaper housing costs and less income from investments.
both can work just as well.... the homeowner is not living free , it is costng him the money that he is not collecting by living there himself and having his money tied up in it ..
there is no such thing as a free ride when it comes to our housing costs.
we really liked owning investment real estate especially commercial property and renting ourselves. i hate working on a house , the maintaince and the constant demand for money to fix something , do preventative maintaince or just plain buy something for the house every time we pass a home depot.
the amount we saved by not owning on all the soft costs is really quite a bit.
Last edited by mathjak107; 02-01-2014 at 05:06 PM..
Ok you have a point. The reason I said luck is because my family lived in park slope in the 70's. Grandma suggested my family buy the building but grandpa probably didn't have the money or just didn't want to. So yeah I wish that was my family lol.
Thank you for understanding my logic in response to your post! Lol maybe you'll find something you'll want to invest in and remain patient!
Quote:
Originally Posted by Amisi
No. There was A LOT of luck involved here. When they purchased the home in 1966, they weren't saying to themselves "in 2014, this will be worth millions". They purchased a home and it appreciated in value. Back in the 1960s, people didn't purchase homes as an "investment". They purchased them as a homestead and a stable place to raise a family. All this "investing" is a relatively recent thing.
NYC real estate didn't start getting crazy expensive until the mid-to-late 1980s and now it's exploded sky high and only going higher. Whoever purchased this property in 1966 could never have foreseen this.
Quote:
Originally Posted by BugsyPal
Oh I don't know, think there is a very good amount of "luck" to making an investment and holding on until or if it does well.
No investment is 100% certain to return good or spectacular results. Back when these persons purchased their home and right up until the 1980's there was a very real possibility NYC could go the way Detroit and other major US cities are going now. Just look around say Chicago and see how well real estate investments from decades ago are fairing now.
No one could have predicted the extraordinary forces driving up housing prices in Manhattan the certain parts of Brooklyn and Queens.
The Bowery of the 1960's, 1970's, 1980's and much of the 1980's was the *last* place anyone would think could see any sort of luxury or high end housing. During much of the past 40 decades the place is as it always was, a place where the "unwanted" went or were sent.
Park Slope like it's surrounding areas is being driven by the huge desire for private home/townhouse living. If something happens to change that dynamic prices will drop, and drop fast.
You guys are looking at my post from the wrong perspective. I personally don't believe in "luck" and that's all I was attempting to point out. Things just don't happen, because of "luck". EVERYTHING happens for a reason. Yes this family made a great profit but if they don't know how to handle that money it could all be gone in a few years. . . luck? Or maybe when Park Slope was on the decline they didn't feel the need to sell or move. We don't know why they waited or what was the cause but it wasn't because they were lucky (even if they say they were - staying there was apart of their course). Do you see where I'm coming from?
My post wasn't intended to talk about this investment in particular but rather in general. When I read that post "Lucky family" - I wanted that posted to know he has the same amount of "luck" as the next guy (even if he doesn't see the effects now). Everything that will happen in your life time is already planned for you, I believe in fate & it's up to YOU to pick the right paths along the way to make the best of it.
I enjoyed reading this thread and as a property owner I find these topics interesting.
The forces of gentrification in New York City - whatever the borough - seem like they are on steroids.
By comparison, Philly has got to be the cheapest of the big cities on the East Coast. Yet, gentrification has come to parts of this city as well. The previous owner of my c.1894 Victorian "twin" (a semi-detached townhouse) paid $34,000 for it in 1980. In 2002 I purchased the house - the previous owner had died and his heirs wanted to sell the place in a hurry (a short sale as they say) - I purchased the house for $188,000 in 2002. The current fair market value is just shy of a half million dollars. If this same French Second Empire Victorian with three stories, 6 bedrooms and 3 ornate fireplaces, hardwood floors, stained glass windows was for sale in Brooklyn or Queens I'm sure it would fetch at least a million or two.
Like i said i rather be lucky than smart. I consider myself a pretty decent investor having been one since i was 19 and investing money from a side job i had. I am 61 now.
Luck and skill are soooo important. They really have to work together.
We made a decision to buy our first co-op as an insider the last week we could after deciding not to buy.
We lucked out as it soared in value out of no where and sold easily ..
I made my first big stock market investment after the stock market crashed in 1987. Scared crap that we were headed lower for sure i was not so sure i did the smart thing.
Well as luck had it i caught the beginning of the biggest bull market in history. 17 years averaging almost 15% a year.
The biggest stroke of luck was i got the opportunity to buy out some partners in a family real estate business. I borrowed 500k to buy them out and took a shot on buying out rent stabilized tenant leases in a prestigious co-op building in nyc.
Talk about luck. Not only did the partners we bought out ask way way to little for their share if things worked out but one of our partners from outside our company ended up being one of the most famous developers in the world.
The first tenant we offered 100k to accepted the buyout and we put the apartment up for sale.,the apartment fetched 2 million bucks and our share paid off the loan 1st shot.
Being lucky again,7 out of 9 tenants took buyouts the last decade and we were able to sell all but 2 apartments.
Luck again,they were baby boomers and really wanted to leave nyc and retire.
The commercial property was sold 2 weeks ago and we are waiting to close.
It sold for 18 million and our company holds a 10% stake. we split our stake with 2 other partners and our son. not a bad take.
I don't think much would have happened out of all the above if it was not for the luck of the timing and events
Last edited by mathjak107; 02-01-2014 at 06:02 PM..
I agree but we are not talking multifamily investment properties here only the home you live in. Big difference between the two.
I ddidn't see in the article where this was a multi family dwelling.
If i missed it and it was then the property was not a single family residential home it was an investment property and does not apply to what we were saying about single family home.
I assume most rowhouses that are walking distance to a subway station that is on a line that is within 30 minutes to manhattan are 2-4 family dwellings. At least zoned that way if not being used as so. It provides a lot of flexibility as to what your current and future family size is.
I enjoyed reading this thread and as a property owner I find these topics interesting.
The forces of gentrification in New York City - whatever the borough - seem like they are on steroids.
By comparison, Philly has got to be the cheapest of the big cities on the East Coast. Yet, gentrification has come to parts of this city as well. The previous owner of my c.1894 Victorian "twin" (a semi-detached townhouse) paid $34,000 for it in 1980. In 2002 I purchased the house - the previous owner had died and his heirs wanted to sell the place in a hurry (a short sale as they say) - I purchased the house for $188,000 in 2002. The current fair market value is just shy of a half million dollars. If this same French Second Empire Victorian with three stories, 6 bedrooms and 3 ornate fireplaces, hardwood floors, stained glass windows was for sale in Brooklyn or Queens I'm sure it would fetch at least a million or two.
You can still find 100+ old rowhouses in NYC for much less than a million. You just won't be in the desirable part of town.
Like i said i rather be lucky than smart. I consider myself a pretty decent investor having been one since i was 19 and investing money from a side job i had. I am 61 now.
Luck and skill are soooo important. They really have to work together.
We made a decision to buy our first co-op as an insider the last week we could after deciding not to buy.
We lucked out as it soared in value out of no where and sold easily ..
I made my first big stock market investment after the stock market crashed in 1987. Scared crap that we were headed lower for sure i was not so sure i did the smart thing.
Well as luck had it i caught the beginning of the biggest bull market in history. 17 years averaging almost 15% a year.
The biggest stroke of luck was i got the opportunity to buy out some partners in a family real estate business. I borrowed 500k to buy them out and took a shot on buying out rent stabilized tenant leases in a prestigious co-op building in nyc.
Talk about luck. Not only did the partners we bought out ask way way to little for their share if things worked out but one of our partners from outside our company ended up being one of the most famous developers in the world.
The first tenant we offered 100k to accepted the buyout and we put the apartment up for sale.,the apartment fetched 2 million bucks and our share paid off the loan 1st shot.
Being lucky again,7 out of 9 tenants took buyouts the last decade and we were able to sell all but 2 apartments.
Luck again,they were baby boomers and really wanted to leave nyc and retire.
The commercial property was sold 2 weeks ago and we are waiting to close.
It sold for 18 million and our company holds a 10% stake. we split our stake with 2 other partners and our son. not a bad take.
I don't think much would have happened out of all the above if it was not for the luck of the timing and events
I'll assume you were inadvertently responding to me so I'll bite. . .
You, like many others confuse OPPORTUNITY and PREPARATION (along with other factors) with "luck".
Ironically, I'm reading this great book and today as we're posting about this whole "lucky" situation, I reach Chapter 2 and what is the topic: "CHOICES" - In short the complete formula for "Getting Lucky" is:
Until people realize this simple fact, most will continue to walk around thinking "Why does nothing good ever come my way" or "Life happens, oh well" and remain mediocre. I'll leave you with this awesome quote from the book as well. . .
"Luck is an equal-opportunity distributor. Lady Luck shines on all, but rather than having your umbrella overhead, you've got to have your face to the sky."
My only point is EVERYONE has the same "luck" as anyone out there. No one person is the luckiest or somehow opportunity will never come their way (and I'm not saying you think you're the luckiest.) Next time you think you're lucky say "I've made a decision to act upon an opportunity." Most people won't act on their thoughts and wonder WHY they aren't lucky. . . because they simple don't take action.
jason zweig (son of marty zweig,one of wall street weeks elves and succeful money manager) did extensive testing using modern brain imaging equipment. he wanted to understand why soime people act and most do not when it comes to their money.
jason and his medical researchers found out something they never expected .
using modern brain imaging equipment they found the human body is predisposed to hating losing money more than it likes making it. as such we use different parts of our brain when we have money at risk vs hypothetical situations.
the human brain made very logical choices when there was no pressure from actually losing money.
every investor can tell you how they planned to bail out before the top and buy in just after the low and had a whole plan for doing so.
like fabians famous moving average system that was supposed to capture the 80% of the gains and protect you from the falls.
it worked great in theory, but in real time few could pull it off as their brains paralyzed them.
as soon as that pressure became real and stress set in different parts of the brain kick in and use anything but good logic.
it will pound you with the negatives of acting until you finally believe your own bullsh*t and don't act.
only 1 out of as many as 500 were able to act when their money was at risk.
i was sooo happy i read jasons book "your money your brain" before the big OPPERTUNITY to buy in the business came up.
my brain worked me over every night throwing negatives after negatives of doing this deal.
i understood why though and i knew my decision making process was not giving me an unbiased logical opinion so i bit the bullet and did it.
best move ever.
i suggest to anyone who wants to be successful to read your money your brain.
you will be more aware of the choices your brain is making and why. you understand your own body is keeping you from acting and being successful.
Last edited by mathjak107; 02-02-2014 at 04:29 AM..
the way it shakes out eventually by retirement a renter who can invest elsewhere can end up with a larger income from investments than the homeowner since eventually a big chunk of money is tied up in the house.
so the renter hypothetically would have higher housing costs from renting and higher income.
the homeowner cheaper housing costs and less income from investments.
both can work just as well.... the homeowner is not living free , it is costng him the money that he is not collecting by living there himself and having his money tied up in it ..
there is no such thing as a free ride when it comes to our housing costs.
we really liked owning investment real estate especially commercial property and renting ourselves. i hate working on a house , the maintaince and the constant demand for money to fix something , do preventative maintaince or just plain buy something for the house every time we pass a home depot.
the amount we saved by not owning on all the soft costs is really quite a bit.
Take 100 young couples with kids who can afford to buy a house they like. Then give them a detailed presentation on how renting frees up cash flow, allows you to never have to worry about maintenance and repairs, and allow you to grow a nest egg in 40 years that is larger than if they bought (for arguments sake, lets assume this is true).
Of the 100 couples, how many would take the advise? Zero. Why? There is something called nesting, and the pride one has when they own something, whether or not it is economically rational. Human nature will never change.
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