Pre-war co-operative, 1925

Bank Street Two-Bedroom

West Village, Manhattan·$2,150,000·2 bed, 2 bath·1,280 sq ft

Pass at this price

1.8% a year over 10 years (-2.8% after tax), with $5,939 a month to carry from year one.

Confidence: Moderate

Net yield2.3%

Year-one rent after 1 month vacant, less taxes, charges, insurance, management and upkeep, divided by the price.

Cash on cash-12.3%

Year-one cash after the mortgage, divided by the $580,856 you put in (deposit plus $43,356 of buying costs).

IRR, 10 years1.8%

The annual return that equates your cash in with every year's cash flow and the sale proceeds after 6.5% selling costs. Values grow 3.2% a year.

IRR after tax-2.8%

Rental profit taxed at 45% after interest and depreciation; the gain at sale at 33%, including recapture. General illustration, not tax advice.

Total return29%

Every dollar of cash flow plus the net sale, less what you put in, as a share of what you put in.

Break-even rent$16,693/mo

The monthly rent at which year one covers the mortgage ($10,034/mo at 6.35%) and every running cost.

True monthly cost of owning$16,808Interest, taxes, charges, upkeep and what your deposit would earn elsewhere

Renting the equivalent$9,800From comparable leases nearby

Renting saves$7,008/mo

Our caseDownside

Year by year

Year	Rent	Net operating income	Mortgage	Cash flow	Value	Loan
1	$107,800	$49,132	$120,403	−$71,271	$2,218,800	$1,593,958
2	$111,034	$50,606	$120,403	−$69,797	$2,289,802	$1,574,203
3	$114,365	$52,124	$120,403	−$68,278	$2,363,075	$1,553,157
4	$117,796	$53,688	$120,403	−$66,715	$2,438,694	$1,530,734
5	$121,330	$55,298	$120,403	−$65,104	$2,516,732	$1,506,846
6	$124,970	$56,957	$120,403	−$63,445	$2,597,267	$1,481,396
7	$128,719	$58,666	$120,403	−$61,736	$2,680,380	$1,454,282
8	$132,580	$60,426	$120,403	−$59,976	$2,766,152	$1,425,395
9	$136,558	$62,239	$120,403	−$58,164	$2,854,669	$1,394,620
10	$140,655	$64,106	$120,403	−$56,296	$2,946,018	$1,361,832