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wait until you need it.

harry, if you're going to be renting it out essentially year-round (at least for the first few years), you pretty much limit yourself to condos. I would advise you to really do your homework here before jumping in. Your best bet is to look at resales (ie: not new development), as you'll be much more likely to encounter sellers needing a quick sale, which means more leverage on your end. As for locations, I don't know what is meant by the "gentrification" of Chinatown, but I don't see it truly resembling the Village or LES within 5 years. I think your better bets downtown would be in the east village or NYU areas - there's always people moving to the city looking for something around there. Many longtime New Yorkers probably aren't too fond of the area, but I'm talking from strictly an investment perspective here.

Well, off the bat, I think you'd do well to listen to your 'better self' on this one. Prices will likely continue their downward spiral; for how long, no one can say. You're far more likely to find a better deal by waiting a bit, especially if you don't intend to move here right away.

Also, please FORGET about what anyone tells you about 'gentrifying'. There are areas of Manhattan that have been threatening to gentrify for decades and we're still waiting. Chinatown is a dump and will be forever. Gentrifying in FIVE years? Seriously?? Yeah, and I got a bridge to sell ya... LES? Meh. You'd do far better in the Village if you want 'downtown'.

You're correct that a condo would be the only option if you're not planning to occupy.

would you buy a car, better yet an SUV, that you didn't intend to use? in hopes that it might turn into a prius in a few years?

Seems like there is no rush to buy something now, when prices are still dropping (and when interest rates go up, prices will likely drop even more). Why would you want to take that risk, not to mention the headache of being an absentee landlord? Furthermore, if you are planning to eventually live in the apartment sometime down the road, then I advise you become well-acquainted with different neighborhoods before committing. You say you prefer to be downtown, but are willing to settle for 89th Street (east or west side?) There is a world of difference among these locations (up, down, east, west). Why not rent a modest apartment when you get here, and then take your time looking around for a place to buy? Don't worry - real estate will still be here when you get here, and it might be cheaper than it is now.

These are great comments. Thank you New Yorkers. One of the reasons I am thinking about buying now is because people keep saying "it's the bottom! it's the bottom!' But maybe you just can't listen.

CC - the advice is good, but your comparison to a car is ridiculous. What's with the turning into a Prius bit? He never said he expects to sell it in a few years, just that he expects to occupy it. Makes no sense.

Harry, there is good advice above about neighborhoods, etc. But as far as whether or not it's a good time to buy, no one has a crystal ball. If you can make the math work for you (rent covers your monthlies), you may get lucky and find a place you will enjoy living in 5 years from now. The mood on this site tends to be quite negative and I certainly don't know what the future holds, but if you are trying to time a bottom, you will certainly miss it.

As far as Chinatown gentrifying, probably won't happen, but I do have friends that live on Lafayette just north of Canal who got a great deal on a new dev condo 5 years ago because it was kind of a shady neighborhood, and it is indeed much nicer there now.

Who keeps saying "it's the bottom"? Nobody on this board! I pass for a bull here, and even I am not calling a bottom.

That said, we may be near the bottom as far as mortgage interest rates are concerned. Not sure that's enough incentive to buy a place that you won't be using as your primary residence. If, however, you find a place you could one day live in, at a low enough price that your rental will cover your mortgage (and then some), it may make sense to buy. But I'm just not seeing those numbers in the condo market. Yet.

Tina
(Brooklyn broker)

The market may be at or near the bottom in some other markets, but I don't think anyone is saying that about NYC. And of course no one knows when the bottom occurs in any market, until it's already passed.

only proctologists make money picking bottoms

A few things to think about. Some new buildings have real estate tax abatements. As these abatments wear-off, taxes can go up dramatically. Even without an abatement situation, you can expect real estate taxes to go up quite a bit in the next few years. Finally, rents have fallen recently and there's a decent chance that they will continue to fall for the next couple of years.