The Brompton

how many square feet is the apartment? Given that you can get a 1200 sq. ft. 2 BR condo a block further west at 150 E. 85th street for $1.3M, the finishes and services at the brompton better be exceptional.

It's 1023 square ft to be exact - 2 full baths, I BR and a "den" around 100 sq ft that can be converted to a 2nd BR. If it were higher up I can understand, but it's abut 20 feet off the street. Not much of a view or privacy...not to mention the noise. I feel this market is getting so overheated - reminds me of the dot.com boom in 1999.

I hear they're asking $1.4mm for the 10th Fl.

it's going to be a tough sell to get 1.3 or 1.4M for a 1BR at 85th and 3rd.

who is the target market for that type of apartment? I'd think high-paid wall street kids would rather be downtown and the more mature empty nesters would probably want to be a little further west.

As to #5's comment, it's not a 1BR really. It's a "junior 4" which I guess can also be called a coverted 2BR = 2 Full baths, IBR and an office which can be converted into a small bedroom - about 100 sq feet I guess, if the guy from #3 is correct. Even then, I still think that's expensive.

It says this place is ready "Fall of 2008" which we know really will be Winter of '09 if they're lucky. That means you can't lock in a mortgage rate until then....if rates go up even 100 bps, I think a lot of people who put money down now will be in trouble!

I do not think I would characterize any of the responses as "insight" which is what the OP asked for...

I am at contract with the exact apartment that the thread starter is referring to. Hope the noise isnt too bad, and I was able to lock in a price lower than asking. Anyone know what the retail space will be?

I just met with one of the salespeople who told me the space will either be a bank and/or a medical imaging facility. They were asking $1.3 million for that unit. May I ask what price they agreed to?

less than 1.3 and more than 1.2 Sorry, as I am a relatively new to this whole experience I am hesitant to publish the actual price. What did you think of the bldg?

I understand...that's still quite helpful to know, thank you. I love the building but I feel that the financial/real estate environment is too uncertain right now for me to buy. Although NY is a unique market, i don't think it is immune to an economic slowdown. Just look at what happened with Bear Stearns...there will be a lot of people this year with litte, if not small bonuses. I also have a friend of a friend who put the down payment on a 3 bedroom unit and is now sweating bullets because he's not sure he can make the mortgage payments once he closes.

The main lesson we all should have learned over the last few months is to no over-extend ourselves in regards to debt vs income. Remember that the rule of thumb for most people is to spend no more than 28% (maximum) of your monthly gross income on housing. This includes mortgage payment, common charge and taxes. Most of the taxes on new condos are abated and step-up every two years. You need to be able to afford the taxes at their true unabated level, not at their abated amount. Also keep in mind common charges tend to increase over time.

So in the example of the above mentioned apartment, if you bought it for $1,250,000, put 20% down, that leaves you with a mortgage of $1,000,000. Assuming you add your closing costs (about 5% of sale price) to your mortgage, that gives you a total mortgage amount of $1,062,500. If you have a 30-year fixed rate jumbo at 7.25%, your monthly mortgage payment is $7,248. Add common charges of $1,093 and monthly taxes of about $1,000 (estimate of unabated taxes), you're looking at a total monthly payment of $9,341. Applying the 28%-rule, this means that your monthly income has to be at least $33,361 or an annual salary of $400,332 in order for you to afford this apartment.

You also have to be reasonably sure that your income will stay at this level for as long as you live in the apartment. While most people looking to buy in buildings like the Brompton make this kind of money right now, not as many people are certain about their incomes staying at that level over the next few years.

Oh and by the way....it does seem like a very, very nice building.

Thanks iMom, very informative. Where does the tax deduction come in?

Admittedly, I'm not a tax expert, but the benefit of the tax deduction comes in at the end of the year to reduce your taxable income and take some of the sting out of your tax bill. You still have to have the funds available to make your monthly mortgage and common charges. Real estate taxes are typically paid every 3 months. Using the above parameters, 88% of your mortgage payments over the course of your first year go towards just the interest on your loan ($76,694 out of $86,977).

iMom/shapeshifter: as I'm not an owner yet, I haven't done this, but a number of my friends increase the number of dependents they claim for withholding in anticipation of the tax break. They keep more money in each check (of course they've worked with their accountants to figure out an appropriate and conservative number of dependents) and it works out at the end of the year when the dependents are factored out and the mortgage interest tax break is factored in.

tenemental-

Precisely what I am doing.

be careful shapeshifter and tenemental - i did the same in 06 when i bought a 1br and i got crushed last year by AMT.

Thanks, stash17. What do you think your accountant failed to anticipate? I would think almost everyone here is subject to AMT.

Firstly, I changed jobs and my income rose about by a decent amount in 06 v 05 which was out of my accountant's control. In 2006 at my new job I was claiming 4 dependents without telling my accountant(figuring I could count on all my home ownership related write-offs). When I told my accountant this after I got hit with the tax bill, he told me to decrease it to 2 going forward and I did this in 07.

Again, everyone's situation is different but that's my example.

hi shapeshifter,

i guess i will be your neighbor. i have also entered into an agreement to buy a 3 bedroom on the 3rd floor. the building i feel is great and almost all related developments with robert stern as the architect do well and fetch a premium. yes the market is currently under pressure but hopefully one can ride thru this rough period.

Great sushilv, congratulations! What are your thoughts on the actual close date? Do you think we have any chance at October?

shapeshifter - are you aware the 3rd floor is the amenity floor, ie, the children's playroom and the common area/tv lounge?

Yes Tony95, I am aware. Our unit is not directly across from the either of those but you will have to walk past our unit to access the playroom. The common area/lounge is on the other side of the elevaotr. I view this as a minor annoyance and one that we are prepared to deal with in exhange for being in a top-notch bldg at our price point. It also helps that we have a child who will be just over a year old at closing (fingers crossed). To be honest, I am way more nervous about the potential for noise on 86th street despite the insulated windows.

sushilv- I signed this week, so now we are officially neighbors. Im hoping for an October close, which as of right now seems on track. Does anyone have any idea when most new construction projects start allowing people to view their actual apartments?

shapeshifter - congratulations. i believe the closing would be either end of october or first week of november. no idea as to when one can view their actual apartments, but as per the contract we can view one week prior to closing. does your apartment face 86th street. mine does and hopefully the noise should be manageable.

Sushilv- shoot me an email at shapeshifter08@yahoo.com Would love to formally introduce myself.

Actually, tenemental, if I don't buy, under the current regressive terms of our great GWB, I'm finally about to leave the AMT. State and local income taxes (and ours are nasty) do push many of us into the AMT, but as the income grows, sickly, the propensity to be hit by the AMT decreases. Adding high real estate taxes (of the sort that will happen over the next few years as tax abatements end) will push many of us Manhattanites sure as hell over the limit.

Sushilv- are you around? would love to catch up re: the brompton

"but as the income grows, sickly, the propensity to be hit by the AMT decreases"

I just have to say, there's nothing sick about it, you move "above" the amt because you're now paying your full "fair" share of taxes.