Buy an Apartment in New York: The Best Decision of your Life
Let us introduce you to your dream idea: Buying an apartment in New York City. Fashion models walking in the streets, meeting your favourite celebrity at the starbucks, long nights out with friends in Brooklyn and Manhattan, and weekend trips to the world’s most famous museums. Industrial lofts, luxury penthouses, views of the most famous skyline in the world. That’s life in New York City. This article is written by real estate experts giving you an easy-to-understand guide to the first steps toward buying an apartment. Our friends at Lukinski have written this guest article Real Estate New York by Lukinski.
Buying an Apartment in NY – How Easy it Can Be
You’ve probably heard that the best investment you can make is to buy a piece of real estate. That’s no doubt true! It’s the best way to spend your money, and profit from it in the future. Of course it’s not the simplest process, but it’s worth the work. We give you an easy guide on what buying an apartment could mean for you.
Why Buy an Apartment? Real Estate Luxury Life
Everyone knows that real estate moguls (think multi-millionaires) are plenty. It seems every second person that’s made a million has done it with real estate. That’s because putting your money into real estate means multiplying it. New York has its legendary penthouses and high-end lofts, or spectacular views of the Hudson. Take a look at this massive $23 mil. penthouse in TriBeCa, right in the center of the city.
Fifth Avenue Living
Want to be closer to the action? Prada, Chanel, and Bottega Veneta just around the corner? Living on fifth avenue gives you more. Not only are you in the world’s best shopping street, but also close to all the hippest parts of Manhattan Island. It’s everything you need to live the high life in the big apple.
Why Should I Buy in NYC?
Buying an apartment in New York has too many advantages to count. Penthouses, lofts, luxury apartments and views of Manhattan. What more do you want? You’re in the middle of all the action. Fashion shows, celebrities, high-tech startups, art, designers, and the list goes on. Whether you’re a young student taking the subway in Brooklyn, a wall street financier living in a manhattan loft, or a fashion model in SoHo, New York is the city of dreams for pretty much everyone.
More than Just Fashion and Tourism
New York is not only one of the world’s largest economic centers, it is also cutting-edge. Countless startups, new tech companies, and artists call this city home. Only recently, more and more companies like Disney have opened headquarters in the skyscrapers making up the legendary skyline. The city is home to 8,4 mil. people, which is why there’s countless neighbourhoods, all with their own unique personality. Williamsburg, Brooklyn feels like a completely different city than the Upper East Side and Bushwick is felt completely different than TriBeCa.
- Population: 8,4 mil.
The Beauty of the City – New York Drone
The New York skyline is incomparable, and its central park is in a league of its own. To really know how beautiful this city is, you have to have been there. But, the next closest thing is an aerial view of the beauty:
What’s so Good about Buying an Apartment?
Buying an apartment means a few good things. For one, it is an investment that you can live in! The second you buy, you are profiting. Every morning you wake up benefitting from your investment. Let’s say you already have an apartment in L.A., and you buy another in New York. Whenever you visit, you can go home, not to the W. Say goodbye to scratchy hotel room bedsheets and checking out at 11:00, you can leave your own apartment whenever you want. You’re not in New York for a month? No problem, rent it out and make a few thousand dollars from a tenant.
- Enjoy your investment every day
But it’s Expensive Right?
That’s probably what you’re thinking. Why should I buy an apartment for $400.000 when I can rent it for $6.000 a month? Well think about it: if you spend $6.000 of rent a month for 6 years you’ve already spent over $430.000. So if you had bought an apartment 3 years ago, you could have already bought half an apartment. So in the end it’s not that expensive at all when you look at how much you’re paying anyways.
- Your past 3 years rent could buy half an apartment
I don’t have Enough to Buy an Apartment!
That’s probably your next thought, who has $430.000 lying around? Well probably not very many people, but people still buy apartments every day. How do they do it? How could you do it? The important word here is ‘mortgage’. With a mortgage you get the bank to pay 80% of your apartment, and you pay them back every month until you’ve paid them back fully. So you only pay 20% when you buy it (that’s called the ‘downpayment’). The money you pay back to the bank is the money you would have spent in any case on your rent, so all you have to do is save up for your downpayment, and you’re good to go!
You only pay 20% of your apartment price!
Top Secret Tips for Your Apartment Hunt
So what do you need to know for your apartment search in New York? We give you our top secret tips on what you can do to make your life easier, and find an apartment of your dreams. Even if you’re not looking right now, keeping these things in mind means you’ll be more successful when you do stumble on the opportunity.
Tip #1: Take Care of your Finances!
This is something to do before you start doing anything else. Even if you are not thinking about buying an apartment right now, you should be keeping careful watch over your money. Yes it can be annoying, especially when you don’t want to be confronted with the reality of how often you ordered take-out in the last month, but it’s a pain worth taking. When you do buy an apartment your bank will be happier to lend you money, given that you have shown in the past that you are in control of your finances. Having months where you go 1.000$ over your credit card limit is not a good look, and may mean high interest rates.
- Avoid bad money management
Tip #2. Don’t Rush it!
Just like Carrie Bradshaw and Mr. Big, you probably won’t find your dream apartment too quickly. Maybe you’ll look for weeks and not find anything, give up, and settle for less. That’s why tip #2 is not to rush it. When you’re in it for the long run, you’ll find what you want sooner or later. And if you follow the other tips I give here, you will have pretty good chances of getting that apartment.
Tip #3: Know how to Negotiate
Negotiation is no simple task. Doing it right can save you thousands. Doing it wrong can mean the seller breaks off the deal. Not to worry though, we know exactly how you can save thousands, as opposed to lose the deal. When buying an apartment in New York, the procedure is typically as follows: You make an offer. This is either renegotiated or accepted. Then, a building inspection is conducted, after which you can typically, based on the inevitable issues which the inspector finds, renegotiate again and reduce your price.
- Always renegotiate!
What to watch out for: When you buy an apartment you pay one full price (e.g. $430.000 for your apartment), but there are also closing costs, like taxes on the sale, broker fees, etc. You should choose to negotiate on one of these. For example, you offer to pay all the closing costs, and the seller reduces their price by a few thousand, or they can keep their proposed sales price, but in turn have to pay closing costs.
Tip #4: Know What Type of Apartment you Want!
Maybe you’ve heard someone say they’re moving into a coop, or that they’ve found a sponsor unit. These are different types of apartments, and have different advantages. Your everyday normal apartment will have you buying only the property, i.e. the four walls, and also have you paying a monthly fee for posssible repairs which have to be done in the building. In a coop, also called a housing cooperative, you do not actually buy the four walls, you buy part of a company which owns the building, and this part entitles you to live in your apartment. This has different advantages, and can often be cheaper. The dream apartment is a sponsor unit or a rent-controlled apartment. In short, these are normal apartments, but for a variety of reasons, they are much less expensive than others. If you find one of these, don’t hesitate, they’re rare and in high demand.
- Look for sponsor units and rent-controlled apartments!
Where to Live in New York
You’ve heard of Manhattan, SoHo, TriBeca, and Williamsburg. What about Flatbush or Bedford-Stuyvesant? Or Chelsea and East Village? If you’re looking to impress a New Yorker, these are the neighbourhoods you’ll have to know, from SoHo and NoHo to Battery Park City and Park Slope:
SoHo – Elegance par Excellence
SoHo is where Carrie bradshaw wanted to live. The epitome of chic and high-class, this district is home to trendy shopping, expensive restaurants and stylish young professionals. Sat in the middle of lowewr Manhattan, it’s close to everything and should fulfill all your wishes.
Williamsburg – Birthplace of Hipsters
Williamsburg is quite literally the home of the hipsters. The formerly anti-mainstream counterculture movement was born in this trendy part of Brooklyn. Like many Brooklyn districts, it has countless small boutiques, concerts, galleries, and cafes. Although nowadays it is slightly less counterculture and much more gentrified, the safety and beauty, along with the countless amenities make this one of the number one dream destinations for people moving to New York City.
TriBeCa – Private Luxury
The most expensive district in New York City is also the home to countless celebrities. They appreciate the quiet ambience of the district, along with its close proximity to everything important in Manhattan, the views of the Huddson River, and endless million-dollar residences.
Bedford-Stuyvesant – Future Williamsburg
If Williamsburg is too gentrified, Bedford-Stuyvesant is where you should move. At the moment, it is not yet at the point where luxury boutiues are overshadowing mom and pops delis, with just the right amount of chic and class combined with the gritty and honest New York City. Also note, at the moment, prices for apartments here are still manageable compared to the rest of the city.
Checklist: Buying an Apartment in New York
Our guide to buying your apartment in New York City is coming to a close. We’ve told you all about why it’s worth buying, why New York is a good place to buy, how to buy, and where to buy in New York. Now it’s up to you to go out and start looking around. Our secret tips to buying your New York apartment:
- Take Care of your Finances!
- Don’t Rush it!
- Know how to Negotiate
- Know What Type of Apartment you Want!
Want to learn more about buying properties in New York?