Buy or Rent in Prospect Heights?

Asked by melindagar, 11215 Wed Sep 26, 2012

I'm looking for a 1 bedroom apartment - and am currently trying to decide between purchasing or renting. I have never owned before, but I have been pre-approved for a loan but only for 10% down. The market in the Prospect Heights area seems to be on the rise, and I feel like only having 10% will limit what's available, or what a seller might accept. What sort of 10% down options are out there? Or would it be smarter to just go for a rental? It does seem it makes more sense to buy if possible, as I know the rental market in PH is on the rise too.
(I am open to looking as far east as Franklin Ave., or possibly Bedford.)

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First Last, , 90002
Sun Sep 30, 2012
Congratulations on taking the right first step, which is getting a pre-approval letter! This makes life much easier for everyone as you consider your options.

There are co-ops that will accept 10% as a down payment in Brooklyn, I have represented some as the listing agent, but yes, this does certainly limit what is available for your purchase. Many co-ops require 20% as a minimum, or even 25% or more.

I would be happy to speak with you to calculate which approach is best for you personally. If you plan to live in the area at least 7 years, owning for most people is almost always a better financial investment than renting.

Karla Harby
Licensed Real Estate Salesperson
Rutenberg Realty
New York, NY
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Mitchell Fel…, Agent, Brooklyn, NY
Wed Sep 26, 2012
Dear Melindagar:

If you purchase a property with less than 20% down you will have to get private mortgage insurance. This can be quite costly so keep that in mind. Your best bet is to get yourself pre-qualified with a mortgage banker to find out what you can or cannot do.

When you meet with the loan officer there are some important questions you need to ask such as 1) how much can I borrow? 2) what rate can you offer me? 3) how much will my monthly payment be for the loan? 4) how much will my closing costs be? 5) do I have to pay for PMI and if so how much will that cost?

Once you have the answers to those question you can add in your other living expenses such as monthly common charges, insurance, real estates taxes if applicable and utility expenses. See if all that fits into your budget and if it does remember... You will also save a lot of money on your income taxes when you own as oppossed to renting! Your accountant can tell you exactly how much you can save.

Also keep in min that if you are purchasing a co-op, some of them have minimum down payment requirements. These policies vary from building to building so you should make sure to only look at properties where the 10% down is permitted.

I suggest you have a good real estate agent help you. If I can be of further assistance please contact me directly. Good luck!

Mitchell Feldman
Associate Broker/ Director of Sales
Madison Estates & Properties, Inc.
718-645-1665/ 917-805-0783
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