Realistic prices for buying a condo
by Barbara Corcoran
Homes in the Midwood section of Brooklyn
Q. I'm 28 years old and have lived in this country for three years. I make around $35,000 a year; I have about $40,000 in savings and my credit score is around 680. I'd like to buy a co-op or condo and am wondering what price you think I can realistically afford.
A. Good for you! Few people have the determination and discipline to save $40,000 out $105,000 in earnings.
You should comfortably be able to buy a home for about $120,000, and if you put $30,000 down, you'll still have $10,000 left for closing and fixup costs.
But if you're willing to stay where you're living now, buy the condo and rent it out, you'll be firmly on the road to becoming a millionaire. Every great American success story starts with just that kind of moxie.
Q. We just finished building an amazing house in Florida, and now we realize that we can't afford the mortgage. We're debating whether we should hold on to the house until the market improves and then sell it, or try to rent it out.
A. You first need to know how much rent you could get for your house and whether that number can cover your mortgage, taxes and insurance. If it does, you'll be able to pack your bags and move on. But I think the most prudent choice is often to cut your losses.
Last year, I pushed my parents to sell, rather than rent, their penthouse condo in Palm Bay, Fla. They wanted to wait until things improved, but months later it was worth 20% less than what they sold it for. Today, Palm Bay ranks No. 1 on the list of fastest-depreciating communities.
The lesson learned? Sometimes it's smart to take your money and run.
Q. I'm looking to buy a co-op in Midwood, Brooklyn, for about $179,000. But recently I've seen some great deals in Philadelphia and Baltimore, where I could get a three-bedroom house for only $82,000. Which property would you suggest I pursue first?
A. You should stick with what you know. Most people lose their shirt when they're sniffing around somebody else's backyard.
John Reinhardt of Fillmore Real Estate knows Midwood. He says it's a great neighborhood, and that the Ocean Ave. area around Avenue M is going entirely in the right direction. It's not too far from Manhattan on the subway, and the neighborhood amenities are great.
|
