Young professionals are a force to be reckoned with in New York City real estate. NYC’s comptroller reports that 1.6 million millennials were living in the city in 2014.
Here are 10 things young professionals should consider before they buy property.
1. Know When to Buy and When to Rent
Before committing to buy property, research the pros and cons of renting versus buying. Are you thinking about buying real estate as a long- or short-term investment? Are there market trends that you should consider?
Image byerik forsberg/ Flickr
2. Investigate Financing Options
Will you need to take out a loan? If so, what type of loan will be the best option for you – a 30-year fixed or a 15-year fixed? Will you need to participate in a first-time home buyer program? Work with a mortgage lending professional while navigating your options.
3. Stabilize Your Finances
When entering the home-buying process, your spending habits should be conservative, especially if you’re seeking financial assistance. Having a large debt-to-income ratio or making expensive purchases could hurt your chances of securing financing.
Even if you aren’t borrowing money, you should save as much as possible for down payments and closing costs.
4. Evaluate the Lifestyle You’ll Have in 5-10 Years
If you’re buying a “forever home” and want to have a family in the future, this will influence the floor plans and neighborhoods you consider. If you want to rent your property while you work overseas or after you move, this is important to know upfront because it’s not always possible to rent out a property you buy.
5. Create a List of Pros and Cons Throughout the Process
It’s unlikely that you’ll get everything you want. As you explore properties and financing options, keep a list of pros and cons for each and rank them based on your priorities.
6. Work with a Buyer’s Agent You Trust
Be sure to work with a buyer’s agent who has your best interest in mind, is consistently easy to contact, and has experience.
7. Determine the Type of Property You Want
Consider building an apartment size, property taxes and maintenance/common charge obligations, and included amenities.
8. Scope out Neighborhoods
Don’t assume you know everything about a neighborhood before you’ve commuted to work from it or have stayed there overnight. See if you can rent a room on Airbnb or bunk with a friend. Explore different neighborhoods and weigh all possibilities.
Photo byAl Diggidi/ Flickr
9. Identify the Forms You’ll Need to Fill out
There’s a lot of paperwork involved in buying a home. Be aware of the forms you’ll encounter and what they mean before you sign them. Always consult a professional if you have questions.
10. Learn About the Neighborhood
Look at crime ratings, school zones, transportation options, future development projects, grocery stores, and anything that’s important to your lifestyle and well-being before you buy.