Wednesday, April 12, 2006

Rent vs. Buy Shocker!

Check out the Upper East Side townhouse in this article.
The MONTHLY rent is $90,000... but it's a bargain!

What's that you say? $90k a month doesn't sound like a bargain to you? But dahling, do the math.
The sale price on this house was $26.25 million dollars. If you were to put down 20% and your mortgage was a 30-year fixed at 6%, your monthly payment would be $125,906, and that doesn't even take into account the property taxes!

I wonder if it's in the no-fee listings on craigslist...

2 comments:

Kansas Simplicity said...

One payment equals twice the cost of my first house in 1990....I think I will not be moving to the East Side....

Jonathan Miller said...

Actually the taxes are probably another $10k to $15k per month. Although its a crazy number, its further evidence that sales of single family homes in this market are not economically driven by investors seeking rental income because it doesn't make sense. Rents don't cover costs. A few years ago Michael Jackson rented a townhouse for about $75k per month. Its been this way in this market segment for at least the last 20 years I have been appraising her so its not evidence of a bubble, rather its evidence of insanity ;-)