Compass Quarterly
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6 Secrets to Buying an Apartment in New York City

Successfully navigate the city’s dynamic real estate landscape using insider advice from a tenured agent team.

For many, the idea of owning real estate in New York is aspirational at best. But the truth is, it’s not as unrealistic as most renters think — and the payoff is often much greater than you’d expect.

Even before we were agents, my partner Kelly Waters and I were proponents of property ownership. Growing up in New York, my family impressed its paramount importance on me, and Kelly was a homeowner in England prior to moving stateside. Naturally, when we teamed up in 2013, educating aspiring buyers was an immediate shared goal.

After working with countless first-time clients, we launched “Confessions of a Former Renter,” a lecture dedicated to the little-known tricks and truths we find ourselves regularly dispensing. Plucked from the presentation, here are six of our top takeaways.

1) The cost of working with a broker? Zero.

There’s one bill you don’t need to worry about footing in the home-buying process: In New York, the seller will pay the commission for your representation as well as their own upon closing, so as a buyer, there’s no reason to ever not work with an agent. Plus, sellers almost always partner with a broker, whose job it is to protect their client’s interest and achieve the maximum sale — just like a buyer’s agent would act in yours. If they have someone advocating for them, and you don’t, the only person who stands to lose is you.

2) Looking to buy? A raise could be the last thing you want.

A lower salary could be your ticket into one of the city’s most affordable homes. New York City’s Housing Development Fund Corporation (HDFC) cooperatives are a bargain — but to qualify, you can’t exceed the agency’s stringent income requirements. Once you’ve purchased the unit, though, it’s yours regardless of your financial status. And some of these great homes are in the city’s most desirable neighborhoods!

The best part of locking in a mortgage in an emerging neighborhood? The rents may raise, but you’ll never pay more.

Crown Heights 3-Bedroom
Square feet: 1,005
Sold price: $950,000
Monthly payment: $4,408
Average rent for a comparable unit in the neighborhood: $4,800
What made it a great investment? By expanding their search to Crown Heights, this client was able to increase their purchasing power from a two-bedroom to a three-bedroom, allowing their family to grow.

3) See your home for what it is: an investment

Want to help back your cousin’s new restaurant? Hoping to score a few extra shares of Apple stock? Good luck getting much help. Real estate, on the other hand, is one of the few investment opportunities where a bank will lend you 80 percent of the funds you need upfront.

This home offers an intelligent layout that makes the most of its square footage at a low price point.

Neighborhood: Gramercy Studio
Square feet: Approx. 500
Sold price: $552,000
Monthly payment: $2,785
Average rent for a comparable unit in the neighborhood: $2,800
What made it a great investment? This client was able to purchase an apartment in Gramercy—already his neighborhood of choice—for the same monthly expense had he rented.

4) You might be able to afford a pricier home than you think

Rather than focus your search on the listing price, consider instead what you can afford to pay on a monthly basis. I remind my clients that, “you don’t live in the price; you live in the payment.” What you pay every month consists of your mortgage, taxes, and common charges (the fee New York buildings charge for general maintenance and upkeep), so if you find a building with low common charges and/or taxes, ostensibly, you could afford a slightly higher mortgage within your planned budget. On the flip side, if common charges are on the high end, you may have to compromise on the home’s price tag.

This spacious home comes in at nearly $600 less per month than the equivalent rental.

Crown Heights 3-Bedroom
Square feet: 1,055
Sold price: $822,000
Monthly payment: $3,236
Average rent for a comparable unit in the neighborhood: $3,800
What made it a great investment? By buying within a new development, this client was able to afford a higher-quality home at a competitive price.

5) Don’t overlook the importance of timing

A mere one-percent increase in mortgage rates could mean a difference of approximately 13 percent in your monthly payments, so lock in today’s historically low rates now. If you’re buying within a limited monthly budget, you’ll be able to get more for your money the lower the interest on your mortgage.

6) Renting and buying are two steps removed

When you rent, you essentially throw money away every month — a reality not lost on most aspiring buyers. But what people may overlook is that when you buy, not only do you retain the value of what you spend in the form of equity, but you essentially make money over time as the investment appreciates — between 5–10 percent every year on average.

This Williamsburg apartment offers access to the thriving neighborhood’s amenities for under $1 million.

Williamsburg 1-Bedroom
Square feet: 659
Sold price: $760,000
Monthly payment: $3,176
Average rent for a comparable unit in the neighborhood: $3,300
What made it a great investment? These clients purchased this apartment as an investment; they paid the down payment and their daughter assumed the monthly mortgage.

Ultimately, we’ve found that nearly all renters understand the value and benefits of homeownership, but few realize just how within their grasp it can be. The tips outlined above are just a starting point — to discuss your specific options or ask questions, we invite you to contact us anytime.

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Compass Quarterly is a print and digital publication that celebrates our brand's core values: technology, data, entrepreneurship, and design. Join us as we create a more sophisticated real estate experience.

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Joe Quiros

Joe Quiros

New York City real estate agent at Compass

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