Hey all, I could really use some advice on buying in Manhattan. Right now, I'm living in a converted 2 bedroom apartment, in the fake converted bedroom and I'm paying $1,150/month utilities. I'm getting tired of paying rent, so I've been looking for something that could be my primary residence to start out with and then maybe an investor unit later on (i.e. once I tire or get bored of the city, I... [more]
Hey all, I could really use some advice on buying in Manhattan. Right now, I'm living in a converted 2 bedroom apartment, in the fake converted bedroom and I'm paying $1,150/month utilities.
I'm getting tired of paying rent, so I've been looking for something that could be my primary residence to start out with and then maybe an investor unit later on (i.e. once I tire or get bored of the city, I move out and sublet). I've been mostly looking at 1-bedrooms that are large enough to convert into 2, with the plan that I take the converted room and rent out the real bedroom for a little more money.
I've been looking at places on the Upper East Side, mostly because I see the potential boost from the Second Avenue Subway once that finally comes in and I'm not really a fan of any of the areas around or below Midtown (this would include the low 60s). My price range has pretty much been in the 350 - 450k area, hopefully not going more than $1,000/month in maintenance. Overall, I need to keep the total monthly expense down to $2,500 or less. I haven't been having too much luck.
I have about ~100k to use as a down payment and should have about another ~50k left over to pass muster by the board, however I haven't really been finding stuff to my liking. Either the place is in a bad location, it's a complete dump or both. So I guess I'll open this up to some advice over here...what would you do if you were in my situation, stay put and rent or accept the fact that I've probably missed the low mark for coop prices and I'll eventually get priced out if I keep waiting? Thanks a lot in advance for your comments and advice!
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Response by NYCMatt
over 15 years ago
Posts: 7523
Member since: May 2009
First of all, Saariss, be aware that for a long-term strategy of ultimately becoming an "investor" by subletting the apartment once you've "tired of the city and moved out", most co-ops would be totally inappropriate. Most co-ops do allow some flexibility for subletting (if you're being transferred for a year or so out of the city for work, for instance), but very few, if any, co-ops allow for indefinite subletting. That's contrary to the whole purpose of the co-op, which is to create a community of owner-occupants, not a building full of transient renters.
Therefore, you might want to look at condos. And unfortunately, at your particular price point, the pickings are quite slim.
I can understand your getting tired of being a renter, but frankly you're got a rental deal that's hard to beat. Unless there's a compelling reason for you to need to get out of your current rental, I'd continue looking. But don't rush, and stop worrying about being "priced out." You may have already missed the bottom, but prices certainly aren't going to rise quickly anytime soon.
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Response by somewhereelse
over 15 years ago
Posts: 7435
Member since: Oct 2009
Agreed. Your housing costs are minimal, much cheaper than you'd have by buying.
If you really want to be an investor, put all the money you are saving away right now, and build your down payment for the actual investment property.
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Response by NYCrealist
over 15 years ago
Posts: 41
Member since: Jul 2010
saariss - Don't believe the hype about the 2nd ave subway. You're looking at close to a decade before it's operating, and that's phase 1. Phase 3 will be when it really becomes a useful line and that could be 20-25 years away.
If you are looking in Yorkville, buy there because it's more affordable and you like the neighborhood.
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Response by saariss
over 15 years ago
Posts: 8
Member since: Apr 2009
NYCMatt,
Point taken and I've thought about that, however any building I'd be looking at would have a flexible sublet policy. I've seen several that have a 2-year residency requirement and then unlimited subletting allowed after that. That would be a prerequisite of whatever I buy into. Of course, having a flexible sublet policy probably further limits my inventory selection, but I have thought about the point you made.
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Response by somewhereelse
over 15 years ago
Posts: 7435
Member since: Oct 2009
don't forget that you're also going to be competing with a lot of other people trying to rent out apartments they don't want to sell but can't sell at the level they were expecting.
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Response by NYCMatt
over 15 years ago
Posts: 7523
Member since: May 2009
"Point taken and I've thought about that, however any building I'd be looking at would have a flexible sublet policy. I've seen several that have a 2-year residency requirement and then unlimited subletting allowed after that. That would be a prerequisite of whatever I buy into."
That's all well and good, but be aware that sublet policies are not written in stone can change literally overnight. My own building's "liberal" sublet policy changed after just one co-op board meeting.
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Response by nyc_sport
over 15 years ago
Posts: 816
Member since: Jan 2009
Also, I don't think too many co-ops are going to let you convert a one bedroom into a two bedroom. You should also read the article in the NYT from a few weeks ago about the legality of temporary walls and the crackdown on them. I will leave it to your tax advisor as to how you offset the rental income from the deductibility of your mortgage interest and taxes.
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Response by printer
over 15 years ago
Posts: 1219
Member since: Jan 2008
It seems that you don't really need much advice - for now you can't find an acceptable place at a price that works. In the meantime, it looks like you are saving about $1500/month compared to what you would pay if you bought a place. either the market will come down and you can find the place you like, or it won't, but you continue to save and have enough to buy a place wherever you end up when you are 'bored of or tire of the city'.
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Response by w67thstreet
over 15 years ago
Posts: 9003
Member since: Dec 2008
nycmatt here = > no counties.... hmmmmmm.... things that make you go hmmmmmmm...
FLMAO
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Response by rb345
over 15 years ago
Posts: 1273
Member since: Jun 2009
Most coop proprietary leases vest their directors with absolute discretion to approve of disapprvoe sublets. In those that do, liberal sublet policy can change at any time.
Condos really aren't that different, espefically if you take the long-term view, because there is no
legal impediment to their adopting coop-like by-laws and operating rules.
You also sound well priced out of Manhattan for what you want and want to spend, unless you fo up
to Inwood and Washington Heights.
You might also want to consider outer boroughts. There are deals in them that would meet your physical
and financial criteria.
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Response by columbiacounty
over 15 years ago
Posts: 12708
Member since: Jan 2009
Nope...county attack has begun for the evening.
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Response by w67thstreet
over 15 years ago
Posts: 9003
Member since: Dec 2008
: ) not you columbia... the other counties... :)
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Response by columbiacounty
over 15 years ago
Posts: 12708
Member since: Jan 2009
I know, I know. Have spotted saratogacounty on adjacent thread.
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Response by saariss
over 15 years ago
Posts: 8
Member since: Apr 2009
I see, well, thanks for the advice. I guess the general consensus here is that I should stay put or just wait for the right thing to come along. Thanks for the input, everybody.
First of all, Saariss, be aware that for a long-term strategy of ultimately becoming an "investor" by subletting the apartment once you've "tired of the city and moved out", most co-ops would be totally inappropriate. Most co-ops do allow some flexibility for subletting (if you're being transferred for a year or so out of the city for work, for instance), but very few, if any, co-ops allow for indefinite subletting. That's contrary to the whole purpose of the co-op, which is to create a community of owner-occupants, not a building full of transient renters.
Therefore, you might want to look at condos. And unfortunately, at your particular price point, the pickings are quite slim.
I can understand your getting tired of being a renter, but frankly you're got a rental deal that's hard to beat. Unless there's a compelling reason for you to need to get out of your current rental, I'd continue looking. But don't rush, and stop worrying about being "priced out." You may have already missed the bottom, but prices certainly aren't going to rise quickly anytime soon.
Agreed. Your housing costs are minimal, much cheaper than you'd have by buying.
If you really want to be an investor, put all the money you are saving away right now, and build your down payment for the actual investment property.
saariss - Don't believe the hype about the 2nd ave subway. You're looking at close to a decade before it's operating, and that's phase 1. Phase 3 will be when it really becomes a useful line and that could be 20-25 years away.
If you are looking in Yorkville, buy there because it's more affordable and you like the neighborhood.
NYCMatt,
Point taken and I've thought about that, however any building I'd be looking at would have a flexible sublet policy. I've seen several that have a 2-year residency requirement and then unlimited subletting allowed after that. That would be a prerequisite of whatever I buy into. Of course, having a flexible sublet policy probably further limits my inventory selection, but I have thought about the point you made.
don't forget that you're also going to be competing with a lot of other people trying to rent out apartments they don't want to sell but can't sell at the level they were expecting.
"Point taken and I've thought about that, however any building I'd be looking at would have a flexible sublet policy. I've seen several that have a 2-year residency requirement and then unlimited subletting allowed after that. That would be a prerequisite of whatever I buy into."
That's all well and good, but be aware that sublet policies are not written in stone can change literally overnight. My own building's "liberal" sublet policy changed after just one co-op board meeting.
Also, I don't think too many co-ops are going to let you convert a one bedroom into a two bedroom. You should also read the article in the NYT from a few weeks ago about the legality of temporary walls and the crackdown on them. I will leave it to your tax advisor as to how you offset the rental income from the deductibility of your mortgage interest and taxes.
It seems that you don't really need much advice - for now you can't find an acceptable place at a price that works. In the meantime, it looks like you are saving about $1500/month compared to what you would pay if you bought a place. either the market will come down and you can find the place you like, or it won't, but you continue to save and have enough to buy a place wherever you end up when you are 'bored of or tire of the city'.
nycmatt here = > no counties.... hmmmmmm.... things that make you go hmmmmmmm...
FLMAO
Most coop proprietary leases vest their directors with absolute discretion to approve of disapprvoe sublets. In those that do, liberal sublet policy can change at any time.
Condos really aren't that different, espefically if you take the long-term view, because there is no
legal impediment to their adopting coop-like by-laws and operating rules.
You also sound well priced out of Manhattan for what you want and want to spend, unless you fo up
to Inwood and Washington Heights.
You might also want to consider outer boroughts. There are deals in them that would meet your physical
and financial criteria.
Nope...county attack has begun for the evening.
: ) not you columbia... the other counties... :)
I know, I know. Have spotted saratogacounty on adjacent thread.
I see, well, thanks for the advice. I guess the general consensus here is that I should stay put or just wait for the right thing to come along. Thanks for the input, everybody.