Well, we are finally at the end of another year! What a year it has been.
More turmoil, bickering, worry and devastation than a cage full of badgers who haven’t eaten in a week.
However, the one shining light was and is real estate. It has been plugging along like no body’s business and from my perspective after doing four sales in two weeks, (two in contract and two going to contract), the market is still very strong.
Of course, interest rates will have some effect on the market, but only for those that are borderline purchasers, who at the top of the debt/income ratios or who are scared to go a bit higher and stretch their “comfort zone.”
My advice is to first figure out the extra cost per month, then divide that amount by 30 days. Then you will really see the daily cost; maybe its $4 to $6 more per day, maybe a bit more or less.
Then ask your accountant (or me!) to figure out a hypothetical purchase and then your approximate tax deductions/write-offs. Won’t you be surprised what a great position you would put you and/or your family in if you were to purchase a home, condo or co-op?
Do you think it just might lower your taxable income, instead of giving all the benefits (tax deductions, appreciation, income, paying down his mortgage, and security of him not renewing your lease for whatever reason) to your landlord?
Would you be willing to “step up to the plate” add a little discipline to the equation and sacrifice your daily latte or whatever you drink at Star Bucks; or give up your cigarettes or Juul device and go “cold turkey” (it’s bad for you anyway); or wherever you can cut back upon to add those wasted dollars to something that will assuredly benefit you and/or your family in the near term and long run to reward yourself with homeownership?
Of course, you know the answer is yes; but can you “bite the bullet”
and do it? The smart ones will!
Figure out the amount of money that you spend each day on depreciable non-beneficial items that you could do without and voila, there is your extra cash to put into your mortgage instead of your mouth!
When I first started out, my wife and I did not go out for eight months (we also just had my daughter), so we were somewhat forced to hang out at home. When we did go out, there was so much crying, that my parents and my wife and I had to leave Cookie’s Steakhouse (remember that place?) on Northern Boulevard, due to the racket that my daughter was causing. I am not saying you should have a baby to do this, but make believe you had one and learn to cut back and be stingy and save every penny and in no time you should have enough for a down payment for at least a co-op or maybe a condo or if you are fortunate enough, maybe a home!
If you think rent is going down anytime soon, you just might be mistaken and misinformed. Unless you move out of the New York area and go upstate or out of state, rents will be increasing to new levels because of those who are slowly but surely giving up trying to purchase (huge mistake) and entering the rental market, besides those already in it looking for one.
I believe, the market demand for rentals by next spring will be enormous (Amazon will eat up any excess in Long Island City and its surrounding areas) and with minimum inventory on the lower to mid-range ($1,300-$2,500 per month in Suffolk, Nassau and Queens) Landlords (unless rent controlled or rent stabilized) will consider charging what the market will accept and if you desire excellent schools, those prices will be even stronger in those towns.
Supply and demand economics will always come into play (unless a catastrophic or cataclysmic event occurs, like a meteor hitting the earth, which is highly unlikely).
Demand in and around the “Gold Coast” of Long Island will be a great, due to the highly ranked schools, so staying in your rent, will most likely be a huge mistake and especially if your lease will be up for renewal in 2019.
One must try to budget oneself, but figure out a buy vs. rent analysis (I provide this absolutely “free” w/o obligation and “no strings attached”).
You must see the reality of staying in a rental vs ownership and you will begin to realize the absolute error of your ways in staying put. Even if you plan to move out in the next three-five years, the tax deductions alone, might be more beneficial than staying in a rental (sit with your accountant and figure it out).
I have a couple, who I just got off the phone with, who bought almost 4 years ago. Their plan was to stay in their rental and then move to Texas. Once I consulted and guided them and showed and explained the benefits of ownership vs. renting, they decided to buy instead of staying put.
They are now at least $125,000 to $150,000 ahead of the game in appreciation as well as the enormous tax deductions they have been receiving all along.
So are you really going to consider or continue to rent in this new year? Your crazy to do so! It may not work for everyone, but why not find out?
Call me to discuss some unique and cutting-edge ways to purchase your own home, condo or co-op in 2019!
Attention sellers! Consider selling soon as the most recent interest rate hike the other week and increasing inventory, will begin to slow appreciation, so consider taking your money and run and reduce your monthly expenses, especially those heating bills!
Beware, a buyer’s market is just around the corner!
I want to wish all my readers and their families and friends and all my business associates here in the U.S. and abroad happy holidays (and whatever you may be celebrating) and a healthy and happy new year in 2019.
Philp A. Raices is the owner/Broker of Turn Key Real Estate at 3 Grace Ave Suite 180 Great Neck. He has earned designations as a Graduate of the Realtor Institute and a Certified International Property Specialist. Receive regular “free” updates of sold homes in your area and a “free” Comparative Market Analysis” of what your home would sell for in today’s market or search on: WWW.Li-RealEstate.Com He can be reached by email, at: Phil@TurnKeyRealEstate.Com, or by cell: (516) 647-4289.