buy? rent? where are we in june 2010?

out of curiousity, what would you say the price/rent ratio was on that place?

To me, depends on how long you plan to live there. If you want to buy and live there for 7-10 years or more, then buying with a fixed rate mortgage makes more sense since you can ride out the ups and downs (probably, although we are kind of in unchartered territory right now). Staying less than 7 yrs, I would rent.

Price to rent I'd figure about 15...

technologic - you have no concern about the effect of mtge rates in the long term on RE value?

at 15x, if your holding period is longer than 7yrs I think buying is a good option. This calculator is really pretty good- just make sure to go to advanced settings and adjust the numbers because the defaults aren't accurate for a NYC co-op or condo.

http://www.nytimes.com/interactive/business/buy-rent-calculator.html

200 times monthly rent is generally break even. (comes out to 16.66 X)

If you can afford to buy something. Buy. If you rent you are throwing your money away. That said, if what you would want to live in you could not afford to purchase (or come close) then rent and be happy.

Here's a brainteaser for alanwake:

You have a choice: you can (i) rent an apartment for $4000 or (ii) buy the exact same apartment, but your carrying costs will be $6500, net of tax benefits. How much money do you throw away each month by renting? Hint: the cost of buying actually matters.

Please answer the question in 30 minutes or less, alanwakeup.

if you find a really good deal, are not overstretching financially with the down payment or monthly costs, have at least a five year horizon of staying, a positive or equal price/rent ratio and you Love the place, buy. otherwise don't.

If you are buying, expect to pay a premium over renting--that is the price for 100% ownership in 30 years, or sooner, when the mortgage is paid. The relevant question is, what is going to happen to the cost of renting in five, ten or twenty years? In the last ten years, the cost of renting has risen and then softened. The net effect is that rents are a bit higher in the past ten years. Rents rose a lot more in the preceding ten years. There is no question that NYC attracts more young people today than 10 years ago, but rents will likely track jobs and income growth. The immediate job picture doesn't look good, but I cannot help but presume that inflation will raise incomes and rents over the longer term.

NO NO NO... the "RELEVANT" question is WHAT WILL HAPPEN AS THE CREDIT BUBBLE GETZ REVERSED in the next 3 YEARS.

ONCE the credit gets squeeezed and banks come clean w/ what's on their books.. ..then we look at incomes and prices. TILL THEN IT IS THE WORST TIME TO BE HOLDING LEVERAGED/ CREDIT BASED ASSETS. (PERIOD).

WHAT IS THE PREMIUM PMG, if rents decrease? What is the value of locking yourself into a rental stream that may go against you? BUYING = OPTION? IN THIS MARKET ... I'd gladly pay a rental premium to be financially FLEXIBLE. but PMG there an entire bldg in Riverside BLVD waiting to be leveraged by you... knock yourself out.... get em while they are hot...

I don't know who taught you finance, but renting is the option. See it cost me nothing to see where purchase price is going.

And FYI, all lemmings who had an io loan = zero paydown of loan, therefore could and never reach 'no mortgage nirvana'. One other thing, a financially savvy person would ALWAYS keep a $1mm mortgage. It IS the cheapest money you can get outside of a subsidized student loan with 0 PIK deferral option. So the key boys and girls is not when you should buy a tax subsidized cheap money leveraged 'home' but when in the credit cycle. M'okay.

im still struggling/procrastinating with this question ...here's a reasonable comparison from SE examples, I think...
Been looking for a UWS 3BR/2B -- these two seem similar..
7900/mo rental: http://streeteasy.com/nyc/rental/652061-rental-210-west-101st-street-manhattan-valley-new-york
1.62M sales: http://streeteasy.com/nyc/sale/476456-coop-895-west-end-avenue-manhattan-valley-new-york
plunk them in the NYT calculator, and assuming +3% increase in both home value and rent, it sez Buying is better than Renting in 12 years. Even if rent goes up +6% annually, buying is better only after 8 years. If home value goes up +2%, it takes 22 years.

Seems pretty clear that buying blows, unless I've read this wrong.
Now to convince my wife, who keeps freaking on me every year when we have a massive tax bill, with no significant deductions (other than 2 kids.)

tripel... had the same issue.

Take the differential give 1/4 to wife monthly as "shoe" money... if she cares about family finances she'll sock it away for bigger Downpayment... and trust me when the NYC RE mkt really tanks.... that extra downpayment will be a magnitude greater leverage in your bidding...

In my case, I just opened a separate checking account with my wife as sole signee... it's got $420K right now... she never complains...

"w67th.... advice you can trust"

if she divorces me, it's still joint property... :)

enough about RE, IPHONE 4.0!!!!!!!

lol, i did the same thing! too much $ in checking or saving accounts ..though she wasnt saying that in 2008 when we avoided getting bent over by Wall St theives

You should determine if buying makes sense for YOU rather than look at some ratio that may not be relevant to your situation.

Although your monthly payment will be higher if you buy, you need to factor in that some of that payment is tax deductible, and some of the payment actually represents SAVINGS rather than an expense.

Whether or not you will be better off buying next year rather than this year depends on whether or not there will be inflation or deflation. I wish I knew.

YOU YOU YOU YOU YOU LISTEN.

PMG, ALANWAKE, BOB_D and PRINTER= > Don't care about money ppl... OKAY, I GET IT. It is so easy for you to make money and it's such a waste of time to "time" the market... YOU DONT CARE! I get it... you have TOO much $$$ who gives a shit, kinda playerz....

FOR EVERYONE ELSE.... here is a little tidbit, 2.5K open houses every weekend going into the SUMMER DOLDRUMS.. .DOES NOT, I repeat DOES NOT presage a strengthening NYC RE market.
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Cramer did say something of value today.... "mkt ain't going up until Santander, fesses up on what it has on its books (re sovereign debts)" and "until, oil spill fiasco has some semblance of closure."

until then just play with your iphone 4.0... one way to kill your summer..... another is a nice sail around the world... financially, you ain't gonna miss nothin....

I'm with bob_d, your personal financial situation is a more important factor that the future of the housing market, which no one on the planet can predict with perfect accuracy, anyway.

I like the rent v. buy calculator from the New York Times:

http://gothamcityhomes.posterous.com/rent-or-buy-calculator-from-the-new-york-time

Karla Harby
Rutenberg Realty

If everyone bought into w67th's self fulfilling prophecy, you would all be competing for and bidding up that same 500psf disco ball in the sky in 1, 2, 3 or 10 years -whatever it takes, eh 67?

Here's an idea e7, pull those buffon protectors over your ears and do your own thing. Find your deal, play it safe and don't look back. Only you know the right answer.

Karla, yep, only a borker couldn't tell ya where NYC re is going.
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spinny. iPhone 4.0!!! Coming soon buddy with gyroscope for coastal navigation!!!!! F'k ya!

And spinny of course you are right. Cause on the way up not a one borker ever mentioned 'making money' as part of 'owning' a home.
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And the converse of that would be?

My $0.02, living in the neighborhood:

- The rental is a superior layout with a lot more space, with 2 REAL bathrooms (and a .5 bath).

- The block the purchase is on is a much nicer one than the rental, and probably the building is nicer as well (certainly the lobbies don't compare).

- Pricing is probably a wash net of taxes.

Knowing the rental prices in my own building (better location than the rental, closer to the purchase) for classic 6's and 7's I think the rental is overpriced. But then they are pulling out all the stops to increase the rent (renovation, pay with AmEx, etc.)

P.S. It always flummoxes me when I see that a rental has a price increase. Because clearly the reason a rental sits too long on the market is because it was priced TOO low! (This one is not such a case, but it is always the first thought I have when I see an increase in a rental price.)

KHarby are you formerly "Fluter"? Interesting.....so you came out.