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Buying a piece of New York real estate can be daunting, so before you jump into the challenges of buying your new place, read these commandments to help you navigate the market. Remember them as you prepare to purchase a piece of the Big Apple.
1. Thou Shalt Act Quickly
New York’s real estate market is so fast-paced that you’ll need to act quickly to get ahead. You should seek pre-approval from your preferred lender early so you can lay down a strong offer the moment you see your dream home. The best New York properties last as little as 30 minutes on the market and interested buyers snatch them up unseen. If you think too long, your ideal property could be sold out from under you.
It’s also smart to settle on the buyer’s broker you’ll use, so he or she can assist you with your negotiations and help you hire the right attorney and home inspector. Getting organized early and having a strong team in your corner can give you an edge in the competitive New York market.
Image via Flickr by A.Davey
2. Thou Shalt Research the Market
Savvy New York buyers can act quickly because they have a thorough understanding of the local market. They know that areas like Tribeca, SoHo, Greenwich Village, and the Upper East Side cost a bit more but hold their value. They also know that NoMad and West Chelsea are up-and-coming neighborhoods setting pricing records, but that their dollar will go further in Murray Hill or Clinton. In short, they know what their money buys in this diverse city, so they can recognize a fair price when they see it.
Doing your research early will give you the confidence to move quickly when the right property presents itself.
3. Thou Shalt Not Play Games
In a less competitive market, prospective buyers can drive the price down by playing hard to get; however, this common tactic doesn’t work in New York City today. There are so many buyers clamoring to get into the market that if you act disinterested or low-ball a seller, he’ll simply move on to the next offer. If your heart is set on a property, you should put your best offer on the table and be prepared to follow through.
4. Thou Shalt Not Borrow More Than You Can Afford
Bidding wars are raging across New York’s competitive real estate markets. In the fourth quarter of 2013, Williamsburg condos sold for an average of 107 percent of their asking price, and Prospect Heights condos sold for 106 percent. It’s a sign of the times that competitive bidding has become the norm, especially in the competitive two-bedroom market of properties priced between $1 million and $1.5 million. Just like in any combat, though, it’s important to keep your head during a bidding war.
Meet with your mortgage broker or financial institution to get a clear idea of the amount you can reasonably afford to pay, and never offer more than this. Otherwise, you could find yourself in serious trouble if your financial situation changes or if interest rates fluctuate. Almost 30,000 New Yorkers are currently facing foreclosure, and you don’t want to be one of them.
Keep these commandments in mind to navigate the New York real estate market with confidence.