Author Topic: NYC-Specific Rent vs. Buy Template - Critiques Requested  (Read 279 times)

FrugalRubles

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NYC-Specific Rent vs. Buy Template - Critiques Requested
« on: July 06, 2019, 10:10:23 AM »
Hello All,
I've been doing a refresh on my Excel modeling skills and created a Rent vs. Buy real estate template using a Youtube Tutorial.
I've adapted it to focus on the purchase of real estate in NYC, trying to assess whether buying and holding a $1M+ property is worthwhile vs. renting.

Looking for feedback specific to the model and the decision, specifically the 3rd tab - Not Selling.

Numeric assumptions are included at the top of each tab.
1. Purchase a 2 bedroom apartment in Long Island City
2. Live in it while having kids over the next 5 years. In year 6, rent it to tenants. Assumption is $5k for monthly rent in Y6, with a 2% increase annually.
3. Nuances of the model - NYC has a 1% mansion tax on the sale of property over $1M. In this situation, you would pay upon purchase.
4. Property would be a condo - you can rent it out to tenants for 30+ days at a time. The assumption here is that after 5 years of living in the property, the owner would rent it out annually, starting at $5k/month with a 2% increase annually.
5. The model has a Cash @ Time Sold vs. Investment Portfolio amount in it. The idea is that the winner of the rent vs. buy calculation is whichever balance is higher in that particular year.

Thanks in advance!