With the New York apartment market finally becoming more of a buyer’s market, the importance of negotiation and other details of the buying process are starting to have a more significant impact on the final sales contracts.
So, even if you are not sure if you want to buy a home right now or not, it may be worthwhile to poke around the market a bit and see what you can find and negotiate with owners who have become more and more unsure about their ability to sell without meeting a number of buyer’s demands.
Here are some of the basics of buying a home:
First, consider the tax advantages of owning. Most home mortgage debt is tax deductible, and for many, if not most buyers, this one advantage alone makes owning a home more profitable than renting, even in the short run.
Second, consider the long-term value appreciation: New York apartments, especially Manhattan apartments, are one of the safest long-term investments out there.
Similarly, the initial costs are often not what many people expect. Down payments on a home are usually about 20% of the total value, though it varies depending on your credit.
Do not, however, forget about the closing costs. Especially for co-op apartments, these can be significant.
Homeowner’s insurance, mortgage recording taxes, etc., can add up to a hefty chunk of change at the end of the day.
Similarly, monthly expenses such as utilities and maintenance costs should also be budgeted for. Real estate taxes are probably the most significant expense. After that, insurance costs should also be factored into the equation.
It is possible, though, to get a mortgage loan large enough to leave you with enough capital to pay for these monthly expenses in a way that causes little to no stress or worry. One should always be conservative when considering what one’s monthly income is going to be, and a little financial cushion creates a whole lot more stability than just peace of mind.
Perhaps the first step, though, is to see if you qualify for a loan, and if so, what kind of loan is available to someone in your credit situation. It is free and will give you the best idea of what type of home you can look for, as you actively look for an apartment, or as you just poke around, looking for that super-deal.