Everyone wanted their own “Trophy” foreign property, be it a studio apartment in Marbella or a high profile office/retail development in London.
It was all about degrees; just how “wealthy” were you before you started, just how leveraged could you get, just how gullible did you appear and just how desperate were you to keep up with the Joneses/Murphy’s/O’Brien’s/Ryan’s/Smurfit’s/Desmond’s et al of this little island economy.
you couldn’t get away from foreign property expos or companies offering cheap gaffs to the EU accession states in 2003/4. In 2003 there were ads on 98FM for gaffs in Cyprus saying that a minimum investment of 20k was needed.
I wonder why they don’t know how many foreign absentee landlords exist in the country, newsprint was full of rosy stories about how Robopaddy was buying up gaffs left right and centre. Now the crash is upon us, we hear nothing about their plight! Budget day 2009 will allow provisions for people to get finance to expensive Black Sea appartments from Robopaddy.
On reading this I recalled some comment made by Harry Crosbie in the Irish Times Saturday Rag Mag a couple of months back that could shed some light on where this gentleman may be headed:
A man after my own heart - I bought the Brooklyn Bridge in 1972 by similar reasoning, “it’s a great location and sure there’ll always be people looking to come over to Manhattan” and I haven’t regretted the purchase for one moment.
And I don’t care how much it’s gone up in value since then, you still can’t have it, it’s mine and I’ve no plans to sell. So there."
He would be lucky to get 2200 for that, as a coporate let, no one live in wall st, its unbelievably dead at nite and even considered to be an un-cool place to live. If you want to live downtown and close to the street, where, by the way there ain’t no banks!!!, you live in the west village if you can or even the east village…its more fun, more to do and more bars to enjoy. Only ppl down there are at night are those in CUNY and they live in resediental buildings…
Add on top his maintenance, which in Manhattan is damm pricey, as well as property tax and the fact that prices are dropping, he’s up the swanny big time…
twit
Do the maths,
Rent at 3k a month, lets be generous and say rents all 12 months… → 36
770K at prime rate, 6%, if he’s lucky. —> 46.2 a year on repayments, Interest only
Maintenance is aprox 800 a month, and thats cheapish → 9600
Incoming = 36200
Outgoing = 55 800
Cashflow = -19,800 a year.
Before capital payments…
So in twenty years, just to break even, he needs to apartment to increase by 607,632.19 to an overall value of 1.377 million. Thats done assuming a 20 year fixed rate of 4% and compounding annually shortfalls, assuming constant rent and maintenance and costs…
Brigten up another shad more an already bright and sunny day!
