Many renters are hoping to purchase a home as mortgage interest rates are ultra low, prices are much lower, and there is usually a good amount of inventory to choose from.
I suggest that you contact a mortgage broker or banker who can find you the best loan package available so that you will feel comfortable on what your down payment should be as there are a few programs out there.
Here are 7 reasons to own your home according to the National Association of REALTORS:
1. Tax breaks. The U.S. Tax Code lets you deduct the interest you pay on your mortgage, your property taxes, as well as some of the costs involved in buying your home.
2. Appreciation. Real estate has long-term, stable growth in value. While year-to-year fluctuations are normal, median existing-home sale prices have increased on average 6.5 percent each year from 1972 through 2005, and increased 88.5 percent over the last 10 years, according to the NATIONAL ASSOCIATION OF REALTORSÂ®. In addition, the number of U.S. households is expected to rise 15 percent over the next decade, creating continued high demand for housing.
3. Equity. Money paid for rent is money that youâ€™ll never see again, but mortgage payments let you build equity ownership interest in your home.
4. Savings. Building equity in your home is a ready-made savings plan. And when you sell, you can generally take up to $250,000 ($500,000 for a married couple) as gain without owing any federal income tax.
5. Predictability. Unlike rent, your fixed-mortgage payments donâ€™t rise over the years so your housing costs may actually decline as you own the home longer. However, keep in mind that property taxes and insurance costs will increase.
6. Freedom. The home is yours. You can decorate any way you want and benefit from your investment for as long as you own the home.
7. Stability. Remaining in one neighborhood for several years gives you a chance to participate in community activities, lets you and your family establish lasting friendships, and offers your children the benefit of educational continuity.
Hope this helps.
Prudential Connecticut Realty
Coops are you best option but as Manhattan has essentially stabilized (though at slightly lower prices), $400K may yield studios, Jr 1's or a small 1 Bedroom if you're lucky. In short, you won't have a lot of option but you would most likely be able to find something. Good luck.
The other thing to consider is whether you believe property values will appreciate as they have done historically over time, or whether you believe some who believe real estate values will continue to depreciate or that the economy will face a "double dip." I'm squarely in the camp of believing we're in the midst of a slow but steady rebound, and that those purchasing today will be exceptionally happy they did in 5 - 10 years. I purchased my own apartment in 1996 during the last real estate downturn when everybody was telling me it would be the "biggest mistake of my life." My apartment value has increased nearly five-fold since then, even after the downturn.
With regard to bank savings, the amount you'll need to put down will depend on the co-op / condo, and whether you can qualify for an FHA loan, etc. If you provide some more specific details, I can better assist or refer you to a mortgage broker. With some co-ops, the board likes to see an adequate amount of savings to carry you in the event you lose a job, etc. This really can vary enormously from co-op to co-op. Some don't look at all, while others might want to see at least 2 years of maintenance + prospective mortgage payments.
Hope that helps!
Jeff Brenner, MBA
Senior Associate - CitiHabitats | CitiSales
Apartments | Townhouses | Multifamily
Rentals, Sales and Investments
By Referral Only
"Platinum Production Award - 2009" | "Top Rental Production"
"Top Overall Production (Sales + Rentals) Award - 2008"
Whatever you decide to do, make sure that you look with a Licensed New York Real Estate Agent who is specialized as a Buyer's Agent. To not have your own representation would be like going to court, without having your own attorney there to represent and protect you. Plus, the best part is that buyers do not pay the Broker's fees, the seller does.
Senior Real Estate Sales Associate
You will need to get your paperwork together regardless of where you purchase regarding financing,credit, assets, income, pre-qual, etc. I am glad to be of service, if you would like to contact me. Good luck.
Joseph C. Hastings
NYS licensed associate broker
Prudential Douglas Elliman Real Estate
A crucial consideration is how long you plan to live there, because closing costs are high, and you would need a lot of rapid appreciation to avoid losing money if you plan to sell soon.
If you need help estimating closing costs, please visit my blog post on buying in New York City:
I have an apartment on the Upper East Side and I would, of course, be delighted to help you find a place if you decide to purchase.
Karla Harby, VP
Rutenberg Realty NYC
What may be good for others may not be good for you. There is no correct answer to your question. The best way for you to determine if purchasing is right for you, is to go over your financials and mortgage options with a loan officer. By doing so, you'll be able to see what down payment is required, what your monthly payment would be, etc. If you would like additional information on mortgage products and options, feel free to contact me. Also, feel free to visit my website for some helpful information.
Best of Luck to you!
There's no straight answer to this question, it depends on a lot of things such as how long you plan to keep the apartment, how much money you are putting down, the size of your mortgage, how much of your costs are tax deductible etc. To answer this question based on your specifics I'd suggest gathering all the necessary information by working with a good buyers agent and a lending institute and do the math, it will decide for itself!!
There're are a lot of tax benefits associated with a real estate purchase. Depending on what type of property you purchase and in what building.
If you would like to speak with me, I would be more than happy to help navigate you through the process.
Feel free to call or email me.
Key New York Real Estate