aceofspades
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September 16th, 2014 at 8:10:07 AM permalink
What $1,500/month gets you in America


Article
MrV
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September 16th, 2014 at 9:13:01 AM permalink
Meanwhile, in Las Vegas: .
"What, me worry?"
teddys
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September 16th, 2014 at 9:44:18 AM permalink
$1,500 gets you a 3-br, 2 full bath, 2,000 sq. ft. condo with ultra-modern appliances down here on ta' rivah in Ohio.

Las Vegas is a great city for renters. Lots of really nice updated inventory.
"Dice, verily, are armed with goads and driving-hooks, deceiving and tormenting, causing grievous woe." -Rig Veda 10.34.4
AxiomOfChoice
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September 16th, 2014 at 11:15:55 AM permalink
lol.

Where I live, $1500 a month will not get you an apartment. You can't even share a 2-bedroom and have that be your share. I pay more than double that for a 1-bedroom, and I am not in one of the nicer buildings in the neighborhood.

Dedicated underground parking spots go for about $300 to $400 per month.
Ibeatyouraces
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September 16th, 2014 at 11:25:45 AM permalink
deleted
DUHHIIIIIIIII HEARD THAT!
DRich
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September 16th, 2014 at 11:40:25 AM permalink
Quote: Ibeatyouraces

$1500 will get you a whole block of burned out houses in Detroit.



The Detroit/Pontiac Silverdome sold for $583,000.

At my age, a "Life In Prison" sentence is not much of a deterrent.
Dieter
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September 16th, 2014 at 11:49:26 AM permalink
Quote: DRich

The Detroit/Pontiac Silverdome sold for $583,000.



So if we could get a 30 year mortgage on it, two of us could split it for about $1500/mo each.

(Not including property taxes.)
May the cards fall in your favor.
chickenman
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September 16th, 2014 at 11:57:54 AM permalink
Quote: Dieter

So if we could get a 30 year mortgage on it, two of us could split it for about $1500/mo each.

(Not including property taxes.)

I'd bet your heating bill would be impressive. But you could eat for free at your own concession stands :)
chickenman
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September 16th, 2014 at 11:59:49 AM permalink
Quote: AxiomOfChoice



Dedicated underground parking spots go for about $300 to $400 per month.

Saw a piece couple weeks ago where a parking spot sold for a million bucks. Condos there are like $8 million+ somewhere in Manhattan IIRC.
AxiomOfChoice
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September 16th, 2014 at 12:14:44 PM permalink
Quote: chickenman

Saw a piece couple weeks ago where a parking spot sold for a million bucks. Condos there are like $8 million+ somewhere in Manhattan IIRC.



The million dollar parking spot is old news (unless it's a different one). Honestly that was just for show -- that is not what the spots are actually worth. Over here there is an active market for them -- people rent condos that include a spot, don't have a car, and rent the spot out. Going rate is $300 to $400.

I'm sure that similar stuff goes on in Manhattan. It is also one of the few places in the US that is more expensive than here to rent an apartment.
Dieter
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September 16th, 2014 at 12:19:04 PM permalink
Quote: chickenman

you could eat for free at your own concession stands :)



Thank goodness. No way I want to be paying $8 for a hot dog and $10 for a cup of beer at home.
May the cards fall in your favor.
chickenman
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September 16th, 2014 at 12:34:08 PM permalink
Quote: AxiomOfChoice

The million dollar parking spot is old news (unless it's a different one). Honestly that was just for show -- that is not what the spots are actually worth. Over here there is an active market for them -- people rent condos that include a spot, don't have a car, and rent the spot out. Going rate is $300 to $400.

I'm sure that similar stuff goes on in Manhattan. It is also one of the few places in the US that is more expensive than here to rent an apartment.

Maybe. It was reported as a record price.
GWAE
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September 16th, 2014 at 12:36:59 PM permalink
Quote: AxiomOfChoice

lol.

Where I live, $1500 a month will not get you an apartment. You can't even share a 2-bedroom and have that be your share. I pay more than double that for a 1-bedroom, and I am not in one of the nicer buildings in the neighborhood.

Dedicated underground parking spots go for about $300 to $400 per month.



I make a very modest wage but we rent a decent 2 bedroom house and all the utilities including cable and phone for $1060 a month. We are in the middle of buying a 3 bedroom completely remodeled on an acre of land in one of the best school districts in the state for well under 100k. My mortgage with taxes and insurance will be under $700 a month with only 5% down. Sometimes I am happy to live in an area like this.
Expect the worst and you will never be disappointed. I AM NOT PART OF GWAE RADIO SHOW
AxiomOfChoice
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September 16th, 2014 at 12:45:01 PM permalink
Quote: GWAE

I make a very modest wage but we rent a decent 2 bedroom house and all the utilities including cable and phone for $1060 a month. We are in the middle of buying a 3 bedroom completely remodeled on an acre of land in one of the best school districts in the state for well under 100k. My mortgage with taxes and insurance will be under $700 a month with only 5% down. Sometimes I am happy to live in an area like this.



Honestly, you really can't compare prices in different parts of the country. A dollar here is not worth the same as a dollar there. Here, things are more expensive, but the salaries are higher to compensate for it.

Personally, I think that you do better living in an expensive place with high wages. You make more and spend more, but, you also save more. Also, although rent is much more expensive, and things at local stores and restaurants are slightly more (since they pay more to rent the space), other things are not. If I buy something from amazon it is the same price as if you live in a cheaper part of the country. Same as buying a car.

I'm sure that your house is much nicer than anywhere that I have ever lived since I've been on my own, though -- that is one thing that I miss out on.
AxiomOfChoice
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September 16th, 2014 at 12:57:59 PM permalink
Quote: GWAE

We are in the middle of buying a 3 bedroom completely remodeled on an acre of land in one of the best school districts in the state for well under 100k. My mortgage with taxes and insurance will be under $700 a month with only 5% down.



Just to compare -- I have looked into buying a place in my building. A 1-bedroom apartment between 700 and 750 square feet would go for about $700k. I'd have HOA fees of about $600/month, plus property taxes of about $700. In other words, I would be paying $1300/month to live in a place that I own outright.

Also, my building is a cheaper one for this neighborhood. The prices are about 1.5x in the building across the street (it's much nicer)

So that is what $1500/month gets you in my neighborhood -- you get to keep the place that you already paid for.

This is why I rent instead of buying. If I bought I would not be saving the full rent amount -- I would only be saving the difference between the rent and the property taxes / HOA fees (that is the amount of the rental price that my landlord gets to keep). And, of course, I would be responsible for maintenance too (anything interior is mine -- the HOA takes care of anything exterior or building-wide, like plumbing). And you also lose flexibility -- it becomes harder to move.

That works out to a savings of only about 3% of the purchase price of the condo. IMO it is not worth it for a 3% return, so I continue to rent.

I think that this is one of the few areas of the country where it's actually better to rent than buy. Manhattan might be another one.
Tanko
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September 16th, 2014 at 2:26:45 PM permalink
Quote: AxiomOfChoice

The million dollar parking spot is old news (unless it's a different one). Honestly that was just for show -- that is not what the spots are actually worth.



The ten spots in a new building on Crosby Avenue in Manhattan are not for sale.

The cost is $1,000,000 for a 99 year lease on a 200 sq. st parking space.
aceofspades
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September 16th, 2014 at 2:35:19 PM permalink
Quote: Tanko

The ten spots in a new building on Crosby Avenue in Manhattan are not for sale.

The cost is $1,000,000 for a 99 year lease on a 200 sq. st parking space.




Actually, you would have a good investment as you could sublease it and make a whole lot more than that!
AxiomOfChoice
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September 16th, 2014 at 3:15:47 PM permalink
Quote: aceofspades

Actually, you would have a good investment as you could sublease it and make a whole lot more than that!



You have $10k per year in depreciation alone. You would realistically have to rent the spots for $4k per month to get a good return on your investment.
aceofspades
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September 16th, 2014 at 3:21:49 PM permalink
It's works out to be $10,101.01 a year

How does a parking spot depreciate?
People pay over $1k a month for parking in NY - and for a designated, private spot for your use only - it would fetch more
AxiomOfChoice
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September 16th, 2014 at 3:48:57 PM permalink
Quote: aceofspades

It's works out to be $10,101.01 a year

How does a parking spot depreciate?
People pay over $1k a month for parking in NY - and for a designated, private spot for your use only - it would fetch more



You only have a 99 month lease. You have to give it back after the 99 years. It's not like an investment which keeps earning money forever. That is the same as depreciation. I'm going to use 100 years instead of 99 years to keep the math easier.

If a 100 year lease is worth a million dollars, then a 99 year lease is only worth $990k. So your investment has dropped in value by $10k in the first year. That is depreciation. That means that the first $10k/year that you earn from it is not profit -- it is just offsetting depreciation.

Your average amount invested at any given time is $500k. That means that, for it to have a return of 5% (which is nothing spectacular) you would need to rent it for $10k + 5% * $500k = $10k + $25k = $35k per year. So, at the very least, $3k per month. I'd prefer a minimum of $4k per month to pay for problems like occasional vacancy, non-payment, your time finding a renter (it's not just a passive investment that you can buy and forget), etc.

Will people pay $4k / month for a parking spot in Manhattan? That is kind of a lot. You can probably almost rent a small apartment over there for that.
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