Why should I buy an apartment rather than rent?

Question

I live in NYC. I can rent a 2BR for 1200. Buying a 2BR would cost at least 0.5 Million. It seems MUCH cheaper. Can anyone prove me wrong?

Answer 1

It all depends on how long you plan to stay in that place. Generally the rule of thumb is to not buy a home unless you'll be there for at least 5 years. I think buying an apartment isn't a bad deal at all for you. There are many pros that an apartment has over a home such as free maintanence costs, flexibility, lower monthly rent than mortgage payment, etc. With a house the biggest benefit is obviously the appreciation it recieves trickles to you when you sell and also the tax break from your monthly mortgage payment is substantial at the end of the year. If you don't have the cash for buying a home or if you're not totally decided on staying there for a few years I recommend sticking with the apartment.

Answer 2

You are buying a condo not an apartment. The condo can increase in value giving you a profit when you sell it (so you could get more than the 0.5 million back when you move out). Also the interest on the loan to buy the condo is tax deductible.

The money that goes for rent is just plain gone. After you pay the landlord it has been spent and can never pay you back.

Answer 3

But every time you put your money onto buying you are investing in it instead of just waisting your money. You can also write buying one off in your taxes (atleast the intrest).

What will really make you sick is for .5 million dollars where I live you could buy an elegant 5 bedroom house and about 300 acres. I can reant a 2 bedroom house for under $500.