In the month of October 2008 there were about 750 real estate deals transacted in Brooklyn, New York. This is down about 50% from a year ago. Half of the neighborhoods in Brooklyn have also lost about 10% of their home values during the same timeframe.
I am not stating these facts to be negative, quite the contrary; I view this as a positive!
Remember, in adversity lies opportunity.
You see, what had actually taken place was a correction in the market. From 2000 to 2005 real estate prices in Brooklyn tripled and quadrupled or more in some places. It basically was becoming impossible for your average buyer to afford a home. Buyer’s pretty much had no choice but to boycott the market.
However, given that prices are down and interest rates are at an all time low, now is THE best time to buy a home!
Let me give you an example: if a home buyer had purchased a one family house in Brooklyn a year ago for $500,000, put 10% down ($50,000) and went for a 30 year fixed type mortgage, as we know, their mortgage payment would have been $2,772.00 per month.
Now let’s imagine that same buyer purchasing that same house today… first of all they would be paying about $450,000 thus saving themselves $50,000 on the purchase price.
If they put the same 10% down ($45,000, they save $5,000 on the down payment) and went for a 30 year fixed type mortgage, the buyer’s mortgage payment would now be only $2,239.00 per month. That’s a savings of $533.00 per month! Wow!
There is no longer a need for homebuyers to boycott the market. The market has responded.
Brooklyn is a great place to live and to invest in real estate; it is truly a “Land of Opportunity”. If you have any questions or comments regarding the Brooklyn, New York real estate market, please contact me at www.mitchellfeldman.com.
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