Should I rent or buy - New York City?

Question

I am trying to decide whether it is time for me to look to buy, or continue renting. I'm in my mid-20s and can put about $40K down, have good credit, preapproved for a mortgage, etc. I just feel like if I'm paying $1500 for an apartment, I won't be saving much more to buy and I'm not making an investment either.

I could only afford the boroughs, and was thinking mainly of Brooklyn, which is still quite expensive...but there are co-ops for around $230K

Answer 1

Rent. You do not have enough for the down payment. Even if you bought, you would still pay $700-a gazillion in Common charges and taxes.

You could only afford a $350K place (you need money for closing and 10% down). They will get you a REALLY small studio or a small 1-bedroom in an outter bourough. Even with the tax savings you will still have to pay $1520 a month (really $1920, but save $400 in taxes). You will also pay insurance, taxes and common charges up around $700/month. That puts you at $2200+ to live in a small studio. Is that where you want to be in 7 years (traditionally that is the cut off for buy/rent)? You will also only be getting $300/month in equity, so you will end up paying $400/month more then renting. Of course the apartment might go up in value, but you also lose 6% to the relator when you sell.

Keep saving, and buy when you can get a place you plan to stay in. The days of flipping are over.

Answer 2

As a fellow New Yorker here is some advice. If you live in NYC and have an apartment for $1,500 that is a great deal. However, to purchase anything is going to be expensive at least $500k for a studio and that is way higher than rent. If you want to own something you will need to go into the boroughs and buy a co-op for 200k + or a condo for 300k + depending on the area. If you move further out to suburbs you could get a house in the 300k+ range and be about 30 minutes to and hour away from NYC. NY is a crazy market and the comparison for rent vs. buying is 50% cheaper. There is a big line dividing the two; it's either you rent for $1000-1,500 per month or pay a mortgae with taxes for at least $2,500 on a cheap place for $350k.

Answer 3

I definitely think you should. With $1500monthly payment, you can afford a mortgage specially if you are a first time buyer. I am not sure where you plan to buy but with $40K down payment is great amount. I would suggest if you choose to put some money down to avoid higher payments that is great. That will also benefit you but at the same time, if you want to save most of this amount for other debts, home improvement, furniture's, to even pay your mortgage, ,etc, There are other ways to go around the down payment. You can be qualify for a 100% finance plus seller assist that can help you pay for your closing cost. if you use this approach, you may not need to spend your own money. December 30th made a year since I have been purchasing. So far, I am still renting in NY but with 5 investment properties,. I can say you should take that route. I haven't purchase for myself as of yet because I am not sure where I want to move too but you should take the advantage while the market is down and you will earn equity on your property.
make sure your credit score is 620 or above so you can get a good rate.
Good luck.

Answer 4

buy.

Your mortgage will be cheaper than rent.
Even if you decide to move you can always rent out your place and make money off it.
You wont need permission to make modifications, and you don't have to worry about your pets being allowed--that is if you have pets.

Answer 5

Buy. Then you will have a sure fire investment. Plus your mtge payments are tax deductable.

Answer 6

Buy it. Visit 4thishouse.com then search for the appropriate property you are looking for.

Answer 7

get out of New York, way too crowded

Answer 8

If you can afford it, buy it...

Answer 9

buy then it will be yours