Rent vs. Buy for a only sort-of-single gal?

why don't you rent a one bedroom or convince your roommate to move out?

1. No!!!!!
2. Probably.
3. No way!

Even in the good times, I would not buy a place unless you plan on living there for 5 years. You will spend a ton in transaction costs to buy and ton to sell, so there is very little chance you will come out ahead of the game in a couple years - and that assumes the place appreciates in value. If prices continue to fall, you may be looking at selling the place for a huge loss or suffering through living in an apt. you both end up hating. I am usually pro-buying (bought on UWS in 2006 when everyone said it was too late), but I would absolutely not buy in your situation. Good luck though.

ditto

I don't want to pay 3K by myself, especially when I'm saving to buy. If I moved into a one bed, I'm paying 2K, minimum, and I have to factor in at least 7K in moving costs (finders fee, security, movers, etc.) It just seems like too much money to spend only to move again in such a short period of time... Plus, I'm just sick of paying rent.

1. Does this apartment make sense if I have to sell it in 2-3 years?

Absolutely NOT. 5 years is the bare minimun you should intend to own for before buying.

2. Does it make more sense for me to rent a studio, even though I don't want to live in one?

Why not rent a 1 bedroom? If it is your price range, then shoot for an alcove studio as some of them are not that bad.

3. Do the costs of moving twice (once into a studio and once when I get engaged) outweigh those of getting into an apartment I don't own for that long?

No

Is there any way that you can have your boyfriend/future financee replace your roommate in the current place? Have him pay half the rent? Could be a good test run before your engagement.

why not stay in 520K beyond 2-3 yrs? you say cozy, not cramped -- so what might be wrong with cozy for 4-5 yrs?

Groth, there is no way you are looking at $7k in fees. No reason in this market to pay a broker fee, so you are looking at one month of security, above advance rent, which you will end up using towards rent, plus moving fees. Flat Rate moved me from UES to Gramercy (big one bedroom) for less than $1k.

Don't buy an apartment you will outgrow that quickly...

Unless what you fell in love with is one of my listings (j/k) I'm with Alan Hart on this one.

The only other possibility that I can see is to buy a one-bedroom condo somewhere GU (geographically undesirable). If you are SO sick of paying rent that you just HAVE to own something, then for heaven's sakes buy something that you can rent out if your circumstances change. You could probably buy in Park Slope on your budget, but then you'd have a Brooklyn condo. I recommend instead Long Beach, because then at least you'll have a beach condo.

Oh, and your cautionary tale is this: once there was a very nice girl who bought a large studio that was just right for her, and even had room for a home office. Then she fell in love with a nice boy who owned a lot of stuff.

Five years later (which included the nice girl writing a well-reviewed book sitting on the floor, because there wasn't enough room in the studio for a desk) the happy couple is just now getting out of that 550-square-foot space.

Your downside to buying the co-op that you love isn't that you'd have to sell it in 2-3 years, it's that you'd end up stuck there (and cramped) for five.

ali r.
{downtown broker}

Ali is a fount of wisdom. I second Alan and everyone else who has helpfully posted.

A couple of other thoughts: If your boyfriend is also thinking along marriage lines and this is something you have discussed, maybe consider getting engaged sooner and moving in together to share the rent. Not for everyone, I realize, but it is worth considering before you risk your hard-earned down payment in a currently declining market.

OK, last question: Do your opinions change if I own this sucker for 5 years? Because I think I could easily commit to doing that...

Personally, no, especially if you are considering children within 5-10 years. I am of the opinion that NYC real estate will continue to decline some, so I would be afraid that when you went to sell you would have to bring a check to the closing. I think that if you're planning to get married, wait and see what your pooled resources look like after. That way he's not going to feel shoehorned into a place you picked out just because you can't afford to sell it. Unless you have already had a) lots of meaningful and looong conversations about where you want to live for the mid-term, b) finances - he should know everything and vice versa, and c) you're planning on not having kids. Families do it, but fitting young children into a 1-bedroom is a challenge.

However, I'm not an oracle, real estate agent, or couples therapist, so please take my anonymous online perspective with a teaspoon of salt.

Thanks so much for your help, all! It's tricky to know what to do, but you offer some very good advice.

Even if you are looking at $7k in fees to rent an apartment (as others have said, unlikely), what do you think you'll have to pay to buy and sell a place? The broker's commission alone on selling your place would be over $30k! All in all, you'd probably incur $35k-40k in transaction costs.

OP: wait, you are DESPERATE! to live alone, yet you are gonna be getting engaged (and I assume will cohabitate with the stud) within a year or so? That doesn't make sense. Why go through all that just to live alone for a year or two?

"Sick of paying rent"????????? That is, to me, a silly concept. You pick the option which makes economic sense. I'm sick of paying taxes - I'm not going to stop paying them because "I don't like the concept of doing it".

Moving into another rental will cost you $7K? how much do you think moving into a condo/coop will cost (in unrecoverable expenses)? 3 times that? more? And when you sell it another 7 to 10 times more than that rather than another 1 times that? So you total for the 2 moves is more like $70K than $14K? How is that a good financial move?

"so you are looking at one month of security, above advance rent, which you will end up using towards rent,"

This is wrong twice: firstly because you can't use security towards rent (a decent amount of tenant do, but it does put you in default of your lease and you never know who is going to say what to who about that), but in addition it doesn't cost her that because she's simply going to use the security she gets back from her current place 9even though there will be a time overlap) so in the end it is cash-neutral.

Also, just to play Devil's advocate (I am unable to help myself from doing this), I disagree that as a total rule people shouldn't buy anything unless they are sure that they are going to stay in it for at least 5 years. Over the past 17 years, millions of people have made plenty of money moving many times every 2 years or so. It depends on what you think the market is going to do. If you think the market is going to be going up 10% to 20% a year going forward, it's a good idea to buy even if you are only going to be there for 2 years to 3 years. Of course, I personally think anyone who believes that is going to happen should factor in the cost of having all their walls rubberized......... but that's just my OPINION.

listen to the advice above....this is not a difficult decision. it is remarkably easy---the problem i am afraid is separating that which is sensible from what you apparently want to do anyway. these are very difficult economic times; don't make your life harder for reasons like being sick of renting.

Groth,
Word of advice. Listen to no one here. Most of them have their own set of agendas and bias because of their own housing situation. Go to your accountant or your financial planner, they should give you a clearer picture of what this purchase will do to you. Do your homework on this place you like and decide. It's a waste of time asking people here...bull or bear.

the 'wise one'

Absolutely makes no sense to buy right now, especially since you're in a relationship. The two of you might want to buy something bigger together in a few years when you get marry. Rents have come down so much you should be able to find a one bedroom with no fee and reasonable rent (you don't need to get a broker, do the search yourself and save yourself 1 month's worth of rent). Meanwhile, focus on saving more cash to buy in the next year or so, by then you should be able to target something better than the one you have your eyes right now!

correction: have your eyes on...

I felt a disturbance in the universal RE force.... and I took my light sabre and came as soon as i could.....

groth.. don't listen to ericho75 (look at his posting in Powerhouse thread)... he is just bitter that he is losing his shirt on LIC re... and his attempt at being above the fray makes him look well... like a guy about to lose his shirt on LIC re...

it's like saying to a kid who comes up to u and asks if he should take crack. don't listen to the 30 people that say don't do it versus the 3 that say "if you feel up to it and can be on it for 5 yrs", but he tries to sound sophisticated by saying ultimately go with your heart and get the final go ahead from your crack dealer. FYI if you don't think there's a sick incentive for ALL financial planners to get you into SOMETHING and there weren't financial planners all along this bubble train you are sadly mistaken, I'm sure ericho69's financial planner said...double down on LIC re. This is 5th grade math... you don't need anyone's advice as they aren't going to be lying next to you at nite and worrying.

It is amazing how some people love to give negative opinions about LIC when they have NO CLUE what they are talking about.

no no no... your part of LIC is totally cool... I'm just out to get ericho69... that one apt he is living in is a total disaster :)

just spreading some love man that's all.....

hold on...isn't LIC in queens? with the airports?

w67th, your light sabre. disturbance in the universal real estate force. i'm holding my sides laughing, snorting liquids. and my family thinks this is but another sign that i'm bat-shit insane.

glad to be of service.... I need to go out more.. I'm running out of material :)

w67th, you're completely wrong. ericho doesn't live in Long Island City, he lives in the District of Overbuilt Underserviced Condo Housing Eyesores Between Astoria and Greenpoint.

douchebag. lol

douche who?

CC: the way ericho69 talks about LIC, you'd think it goes CPW, 5th ave, Park Ave, LIC, Village, battery park, harlem. Doesn't understand the concept of contiguous objects.

alanhart: must agree a lot of park chesters.. doing the rent out primary NYC apt for a net loss for 1 yr and see if mkt corrects... LOTS and LOTS and LOTS... in a "normal" mkt, this would drive "for sale" units down and thereby creating automatic stabilizers to "sale" price free falls.... but not this go around....

almost but more like: LIC, LIC, LIC, CPW, 5th Ave, etc.

I can totally relate to this and trust me, until you move in with your boyfriend, you will never know entirely what your needs for space are. A cozy studio sounds nice, but then you get into a fight and all of a sudden that place feels a lot smaller. And you may have to get rid of stuff; I know women think only guys have to do this but that's not true. Until this magic moment, I would take advantage of this rental market and move into a studio; based on what you can afford, that should not be a problem. Or if you like your existing apartment, wait for your roommate to leave and have him move in when you are ready. Good luck.

"until you move in with your boyfriend, you will never know entirely what your needs for space are"

I have 4 custom made, oversized (in all 3 directions, hieght, width and depth) medicine cabinets in my bathroom. one has a bit of a cut out for a "chase" for a riser, so it's a little smaller in capacity.

I get 1/2 half of that one and my wife uses the other 3 1/2 (which is probably the equivalent of about 7 "normal" medicine cabinets)

"Word of advice. Listen to no one here. Most of them have their own set of agendas and bias because of their own housing situation."

Funny, coming from the guy whose been saying buy over and over again.

I love it when the shills tell you to "watch out" for bad info.

30 years...I hear you...I guesa my run on sentence was confusing. What I meant was, the advance rent (out of pocket) goes towards "real rent" eventually so it's not an "extra" expense. Security is just more forced savings! So reasonably, you still can't get to $7k in moving expenses...

just to be clear, my point about the security was also that it LOWERS the $7K rather than raising it, because essentially the "net security deposit" moving from one apartment to the other is zero because you take the security you get back from the first apartment and use it for the next one, whereas if you stayed, it would just sit where it is, but in either case, it's a net cash outlay of $0. OTOH, if you decide to buy, even though it's not a "profit or loss" item, it is a cash positive item (like, you can use the security deposit you get back towards your purchase closing costs), sort of turning an illiquid asset into a liquid one.