Should I buy or rent?

also should mention, I'm interested in modest spaces in brooklyn

Have you identified any potential places that you could consider buying?
How much is your current rent? Are you happy with the place you live in now?

bradromens,

Well, congrats on such a nice salary at a young age. The problem immediately is your savings are not much. If you just pay 10% without even considering all fees and expenses in closing a real estate deal, you would only be able to put 10% down on a $280,000 place. That normally qualifies you for a coop and coops tend to be stringent in terms of having additional savings, say for at least enough to cover a year's maintenance (this is just an example; the financial requirements will vary depending on the coop).

You may be able to find a place that takes only 10% down with govt sponsored loan programs but then you pay PMI (insurance that needs to be paid when you put less than 20% down). However, your starting point (savings) really limits you. Though you have not mentioned areas you want to live in to determine if buying is even within the realm of possibility for you. Coops in parts of Queens, Brooklyn, the Bronx (maybe studios and one bedroom+ condos in the latter) might fit into that $280,000 or less range.

However, even in that range, you would clean out all your savings. I do not think that will fly with the lender, if you can even find any lender in these circumstances. Unless you look for a coop in the $100,000+ range. Even then, it will be very tight and will limit you to areas that are not prime or maybe, even "sub-prime." With expenses, i am not even sure you can buy a place for $100,000 and have left over to cover at least 1/2 or more of maintenance payments.

Unless you can get help with with some gifting of money for your down payment and other expenses, it sounds to me like you are still early yet in your wish to buy a home. One more thing, if you have just gotten the salary of $125,000 recently (less than 2 years?), you may also lack the stability and consistency in earnings over time that lenders are looking for.

Oops, just saw your second post. here are examples of places that might even be out of range for you given the amount of savings you have, In Prospect Lefferts Garden in Brooklyn, east side of Prospect Park:

http://streeteasy.com/nyc/sales/prospect-lefferts-gardens-brooklyn/status:open%7Cprice:-200000

Another studio in actually a good part of PLG that was recently taken off the market, that you probably cannot even afford:

http://streeteasy.com/nyc/property/4112042-50-lefferts-avenue-1d

This is an uphill climb right now until you can sock away as much $ as you can in the next several years. Or have someone gift you $ for the down payment and expenses.

Also, if these are primarily studios or very small spaces that you can afford (and even this is questionable), it is hard to think about you staying in place for a long time, as you change and your circumstances change (maybe get a partner, get married, have children, etc.)

Please feel free to contact me - I have some thoughts for you.

I would continue to rent and save up till you can get 20% down plus another 5% for closing costs, first you will have a lot of co-ops reject you because you don't have enough money and you will have wasted 2-3 months and filled out tons of paperwork. Also remember when you own a place you always have unexpected costs (example oven breaks) which even with a cheap $500.00 oven always go up to $1000 with installation and delivery. Also note that rental rates are relatively low in regards to realworld increase in prices.

No question rent. As above, wait till you have 20% and can afford something nicer. You will be unhappy in three years with what you could currently get.

Absolutely rent. At 25, even though you are making great money, your life is still (or should be) transitional. Let's say you meet a woman or man in California and decide that's where you want to be? Or that you just want to take a year and travel the world? Why be saddled with selling an apartment and the attendant transaction costs? Rent now. You can either rent in a modest neighborhood and put away savings for a future downpayment so you won't be saddled with an 80% mortgage or live it up a little in a hip area. Being 25 is abut having as fun as possible even while you work your butt off to establish your career. (And assuming you work in one of those lucrative junior jobs like law or finance where 80 hour weeks are not uncommon, you might want to consider the advantages of living close to the office. Even if they provide car service, an hour commute at 2am is not fun when you have to be back at it at 9.)

OP, with an income like yours, you should be able to save very aggressively. Live somewhere cheap now -- there's no shame in having roommates when you're only 25 -- and stash away as much as you can. Assuming you're working a job with very long hours, you're probably not wasting a ton of money going out or travelling. Do you have friends with expensive tastes? If not, live as if you made half or a third of what you really make. Then, in two or three years, you've got a substantial down payment to buy what you really want.

A lot of great comments by all posters.

But to draw from my personal experience, in my 20s , what I was "sure" I wanted changed every 3/4 years for the next 15 years. To buy anything you won't stay in at least 6/7 years, you are far better off renting.

Point is, even if you are against the majority at your age and truly know what you want, I promise it will change within a few years.