Rent Versus Own Debate: 55 E. Erie in River North
55 E. Erie is a very successful luxury high rise in River North. Built in 2005, it has 214 units.
In a market where luxury sales have stalled, three units priced over $3 million have sold in 2008 alone.
But you don’t have to have millions to live in the building. No- you can simply buy, or rent, one of the larger one bedroom condos.
Take Unit #2206. It is both for sale and available to rent.
Which is the better deal?
(These are the only interior pics available.)
Unit #2206: 1 bedroom, 1 bath, 1060 square feet
- Sold in February 2004 for $414,500
- Currently listed for $525,000 (parking about $40k to $50k extra)
- Assessments of $446 a month
- Taxes of $7,900
- 8 x 10 balcony
- Gold Coast Realty has the listing
Here’s the listing for the rental:
BEAUTIFUL 1 BEDROOM, 1.1 BATH CONDO IN PRESTIGIOUS FULL AMENITY BUILDING. VIEW TRUMP TOWER AND THE CITY FROM YOUR TERRACE. UNIT FEATURES HARDWOOD FLOORS, WALK-IN CLOSET AND CHARMING FIREPLACE. UPGRADED KITCHEN INCLUDES GRANITE COUNTERS, 42 INCH CABINETS. MARBLE MASTER BATH WITH RAISED DOUBLE VANITY. ENJOY STEAM, SAUNA, FITNESS ROOM, LAP POOL. WALK TO WORK, MICHIGAN AVE. PARKING ADDITIONAL.
Unit #2206: 1 bedroom, 1.5 baths, 1060 square feet
- For rent at $2500 a month
- Parking extra (probably $200 or $250 a month)
- Gold Coast Realty has the listing
Rent or Own?
Very quick back of the envelope says even with tax deductions you are running about 40k a year in expenses, I say rent. Very nice building though, probably my favorite within those blocks since I think the Fordham ones are horrendous.
Want. That. Terrace.
Another delusional seller in lala land. No one bedroom anywhere in Chicago is worth this kind of money, rent or buy. Especially with furnishings that are definitely not on par with what someone would expect at this price. 1060 square feet for a one bedroom is just wasted space. They could have carved out a second bedroom easily and maybe then actually be able to get somewhere near their asking price.
As a side note, this is some of the worst real estate photography I’ve ever seen. Who takes a picture of the balcony floor, rather than showing off the nice view? And they could have at least bothered to turn on the lights and make the kitchen look somewhat appealing.
Good point, Pete. I see this all the time in the MLS where the agent takes the pictures instead of springing for a professional photographer. A $500K listing and the agent couldn’t bring VHT in? The photos make a huge difference. Why do sellers tolerate this?
I agree with both of you. It’s truly amazing to me. I actually had to get these “pictures” off of the rental listing. The for sale listing didn’t even have ANY pictures!
That’s another pet peeve of mine. How does anyone expect to sell a property today without ANY pictures in the listing? It’s amazing to me that someone would attempt to market real estate in this manner in this type of market.
IB raises a good point as well. This is fairly typical where it is cheaper to rent than to buy. It means that either rents are too low or prices are too high – and right now you can guess which one it is. I wonder how sellers reconcile this in their minds.
Gary,
For the same reason sellers are stupid enough to use a sellers broker. At least paying a commission to a broker that brings you a buyer makes some sense.
Well, there is actually a lot that a seller’s broker can do to get the property in front of a buyer’s broker and their clients and present it in it’s best possible light. The key is whether or not the seller overpays for these services. Given the current competitive choices there is no excuse for a seller to overpay or to settle for less than stellar service. Here is a quick overview of what someone should expect of an agent on either side of a deal:
http://blog.lucidrealty.com/2008/05/23/what-to-expect-from-a-listing-or-buyers-agent-2/
This is my favorite building in river north. Have looked at multiple units. Too pricey, but lots of amenities, including olympic pool and running track. Lower floors have all the one-bedrooms. This unit has no real view–looks right into 2 E. Erie and Pinnacle, etc., looking north/west.
Rent.
But I wouldn’t shell out $2500 plus parking to rent a one bedroom.