Buying real estate in New York City can be a daunting task. Buying a home is usually the largest purchase a buyer will make in their lifetime, so it is not something to be taken lightly. Be sure to think over these considerations throughout your home buying process.
Key Considerations Before Buying
Cost
One of the first considerations you have to make before considering buying real estate in New York City is the sheer cost. It’s no secret that New York City isn’t cheap. On average, the median sales price for homes in each borough are as follows:
| Borough | Median Listing Price | 20% Down Payment |
| Manhattan | $1,000,000 | $200,000 |
| Brooklyn | $790,000 | $158,000 |
| Bronx | $579,000 | $115,800 |
| Queens | $600,000 | $120,000 |
| Staten Island | $649,000 | $129,800 |
Note: Remember that Sellers typically expect around 20% down.
Be sure that this is something that you can afford without sacrificing the discretionary spending that allows you to experience the food and culture of New York. Do some research and hunting, and you’ll likely be able to snag a deal somewhere.
Ownership Structure
One of the most important considerations you must make when considering property ownership in NYC is the type of ownership structure you desire. If you are considering an apartment, you’ll need to decide whether a Co-op or Condo fits your needs better.
Even with townhomes, fully detached homes, and lofts, it is important to consider any type of ownership structure and organization, such as a homeowners association, and how it will impact your lifestyle.
Renting Instead of Buying Real Estate in NYC
The majority of New Yorkers choose to rent instead of buy. While affordability is certainly a factor for many people, those who can afford to buy may see it as a bad investment. Ultimately it comes down to your views on whether or not buying a home is a worthwhile investment.
It also depends on factors such as the neighborhood you’re in, the ownership structure of the property, and your economic situation. It’s no secret that New York City comes with especially high barriers to homeownership.
With the consequences of global warming looming in the distant future, it is also wise to consider if buying a home in a coastal city like New York is something you will be able to pass down or sell at some point. Sometimes it’s better to just take the loss on rent, let the landlord deal with maintenance, and just move out whenever you want.
However, in some cases, buying property absolutely makes sense, especially for people who are firmly rooted in the neighborhood they live in. The average annual return on property ownership is 6.9 percent. If you’re rooted in the neighborhood you live in or plan to live in, this can be an excellent way to start building wealth.
Once You’ve Found Your Dream Home
Brokers and Lawyers
Buying real estate in New York City can certainly be done without a broker or real estate agent. However, the broker’s fee is almost always part of the sale price of the home, so it really doesn’t make sense not to. A broker can be extremely helpful when it comes to co-ops, as they may already be familiar with the property and can help you frame yourself as a perfect fit for the housing community.
A real estate lawyer is also someone you’ll want to consider. In New York City, buyers need to come up with a contract in order to finalize a sale. The lawyer will help you get through the paperwork and come up with all the necessary documentation throughout the process. They will also protect you and advocate for you. Not having a lawyer may put you at the mercy of the seller and their legal representation.
Preparing and Submitting an Offer
Once you’ve got your advocates by your side, you’ll need to talk to the listing agent if you’ve found a property you’re seriously interested in. Remember, in New York state offers are not binding, until each party has signed the purchase agreement.
Investigate and Inspect the Property
This is where having a real estate lawyer really comes in handy. They will look into the property to make sure there are no legal issues or violations surrounding the property. After doing legal diligence, ask your broker or agent for referrals for trustworthy home inspectors.
You may already be floored by the prospect of living in the new property, but it is important to really make sure you understand the full picture before diving in. You don’t want buyer’s remorse on what could be the biggest purchase of your life.
Look Over the Contract; Sign If It’s Right
Be sure that your lawyer reviews and negotiates the contract to everyone’s satisfaction. Once you’ve done that, meet with the lawyer to get a full summary of the full picture, including the terms of the contract, the due diligence and the home inspection.
If the contract is right for your particular situation, go ahead and sign it. At this point, you’ll likely go ahead and hand over a contract deposit of approximately 10% of the contract price.
Mortgage Commitment
Once your contract is signed and has been executed, you’ll then go to your mortgage provider who will finish their underwriting process and provide you with a mortgage commitment letter.
Finally, Closing
At this point, all that’s left is to sign all the finalized documents at the property’s closing. It will likely be a mutually agreed upon meeting with both parties’ lawyers and brokers. Remember to contact your mortgage lender to get a thumbs-up to close. After that, you’ll likely incur some fees and taxes. The lawyers will go over a bunch of disclosures, you’ll finally receive your keys.
Hire Professional Movers
Now that you’ve found yourself the perfect home, you’ll need a team of professional, reliable movers to get you there.
Metropolis Moving has gained the reputation of being one of New York City’s most courteous, careful, and friendly professional moving services. Get a quote today and you’ll be on your way to living the life you envision for yourself in New York City.
