1st time buyer

Before this thread turns into yet another 15-page debate between stevejhx and stevejhx, let me say that you shouldn't listen to anyone on this board about whether or not it's the right time to buy. Only you can assess your financial condition, your comfort level, and your desire to own v. rent. People on this board can debate until their blue in the face as to whether the market is prime for buying or whether it is going to noticeably decline more over the next 6-18 months. If you are planning to buy to live in the place for the long term, that debate will only confuse you and will serve you little purpose. Timing the market is not as important when you are buying as a home instead of an investment, and it's often impossible to do in either case.

As for stead fast numbers, there really are none and it can vary significantly by area, building, amenities, etc. ($1,500 maintenance might be high for one building but might be low for another). The best thing that you can do is to look at listings online daily, go to open houses, and speak with friends and others you trust who are familiar with the market. Eventually (and rather quickly), you will get a feel for what the general numbers in terms of maintenance and cost per sq. foot are, for the types of properties you want.

As for broker fees, if you are buying, it's not a number that you should concern yourself with. Broker fees are typically paid by the seller.

newyorkmike, I have actually learned a lot from stevejhx. Read some of the threads for extremely useful links to other real estate websites as well. Good luck!

I agree with joepa that much of this is really a personal decision. If you really like an apartment, it's in your price range, and you plan on staying for a few years, I would not worry too much. Price per square foot will vary both by location and type of apartment. You might want to check out urbandigs.com - I've never used urbandigs as a broker - but he is very insightful.

Let me say - I didn't mean to be critical of steve in my post. I was just poking fun and have learned a lot myself (for better or worse).

I suggest a number of things as you start out.
1. Look at as many open houses in your price range as possible to become an "expert" in your niche of the market.
2. Study Streeteasy! Become an "Insider" for $10/mo. to easily see comparable sales in buildings you like (Streeteasy provides a chart for virtually every building posting the offering and close price from the last couple of years). Save buildings you like and open houses you go to so Streeteasy can notify you by email of any changes like sales or price reductions or new listings. This will help you keep your finger on the pulse of your niche.
3. Figure out exactly what you can spend/put down using a financial advisor if necessary. The more variable you remove, the clearer your head will be when it comes to making decisions on whether, what and how to buy.
4. Buy a little book on how to negotiate if it isn't a real strength of yours. Even if you find a broker you like and want to use, you should understand basic negotiating dynamics and pitfalls to avoid. Negotiating blunders can unnecessarily cost you plenty of money.
5. Keep an organized notebook of all open houses you attend with notes on the offering sheets about what you did and didn't like about each unit/building. After a short time they all begin to blur and this will help to keep you clear on what you saw and thought.
6. Educate yourself. Daily/weekly reads include www.urbandigs.com , www.curbed.com , the NYT Sunday RE section and glance at the talk forums on this site. Take it all for whatever its worth, but at the very least doing this for 20 minutes a day will make you conversant in the language of NYC real estate and the current issues getting attention. HGTV buying/selling shows are entertaining and sometimes can help educate you further (but remember NYC RE is different in significant ways from other markets).
7. Caveat Emptor. This is perhaps the most significant purchase you have ever made. Treat it that way. Examine all information you are given with a critical eye, get second and third opinions, look for ways to corroborate anything you are told by a broker--or anyone else for that matter.
8. Get a knowledgable real estate attorney lined up so you don't have to scramble later.

While its a personal choice, I would wait to buy for at least another year - to year and a half. The inventory is expected to build as job losses continue and the dollar weakens. If you are trying to lock in a low interest rate, that is part of your math to consider. In terms of renting versus owning right now, it is significantly cheaper to rent than own if you plan on selling anytime in the next 7 years or so. Since upon selling, you can expect 10% of the sales price to go toward fees and taxes. What else can you do with that capital? If the market is flat to down, renting is cheaper and preferred. I took my real estate profits off the table in November and have made 30% in the stock market in the last two months. Buy low, sell high. Good luck to you.

all the above is good advice but another consideration is how long you're planning to stay in that apartment. while some posters assume that real estate is always a long-term investment, due to personal circumstances relating to relationship status, work, etc. for young people and 1st time home buyers this often changes... so know what your horizon is for the next 5 years b/c in this market you really have to commit to staying 5+ years to make it financially worthwhile... if you may to need to upgrade into a bigger apt. or move because of work in the near future it's better to keep renting and hold off.

check out this link below for some helpful calculators, including the rent vs. buy calculator:
http://homefinance.nytimes.com/nyt/mortgageCalcs/calculator/rentVBuy/

good luck!

Making a blanket statement like "it is significantly cheaper to rent than own if you plan on selling anytime in the next 7 years or so" is not only misleading, it may also be blatantly false for some properties in some areas of the city. joepa correctly warned you to take statements like this with a grain of salt, make sure you do your own research.

I would also suggest taking a close look at the rental market in the area of town you want to live in. There is a lot of crap out there in rental inventory and it is helpful to understand what your budget can get you and if it would meet your needs. It is easy to say renting is cheaper, but can you really find a quality rental in the neighborhood you want in your budget? It is much harder than people on this board like to admit.

On the mortgage end for a 500k-800 purchase you still can obtain a 30 year fixed mortgage until the end of the year. The new conforming limits are up to 729,750. If you are worried about declining market then an ARM probably isnt for you. I always say if youre looking to buy to live there a long time then its usually okay to buy. I don't know the details of your situation so I dont know if renting is better or buying for you. sunny_hong@countrywide.com

BEWARE "new" conforming limits. They DO NOT apply to co-ops (somehow shong seems to always leave that out) and most apts in NYC are co-ops.

kylewest is absolutely correct. Coops do not apply. Thanks for pointing that out.

A number of people have found my book -- which is a real estate memoir with tips for consumers -- helpful.

A copy of Money magazine's semi-excerpt is here: http://money.cnn.com/galleries/2007/moneymag/0707/gallery.finding_the_perfect_home.moneymag/index.html

and the Amazon link for the book is here: http://tinyurl.com/2ag28z

Also my website is searchable, and it is free: http://www.frontporchllc.com

ali r.
{downtown broker}

Not sure about the comment by manhattanfox "and the dollar weakens" - I really doubt there is a consensus there. Congratulations for your 30% gain if you have turn it a realized profit.

btw: here's another calculator allows you to plug in rent numbers and sale numbers to figure out which option is better according to your time frame...

http://www.nytimes.com/2007/04/10/business/2007_BUYRENT_GRAPHIC.html?_r=1&oref=slogin#

note for the calculator posted above (and again below) while the analysis calculates tax payments, it doesn't include maintenance or common charges which are typical in new york coops and condos so that will be an extra expense to consider in your buy vs. rent evaluation.

http://www.nytimes.com/2007/04/10/business/2007_BUYRENT_GRAPHIC.html?_r=1&oref=slogin#

and the related article from 2007 even before the recent housing crisis notes:

Over the next five years, which is about the average amount of time recent buyers have remained in their homes, prices in the Los Angeles area would have to rise more than 5 percent a year for a typical buyer there to do better than a renter. The same is true in Phoenix, Las Vegas, the NEW YORK region, Northern California and South Florida. In the Boston and Washington areas, the break-even point is about 4 percent.

“House prices have to fall more before housing becomes a clear buy again,” says Mark Zandi, chief economist of Moody’s Economy.com, a research company that helped conduct the analysis. “These markets aren’t as overvalued as they were a year ago or two years ago, but they’re still unfriendly. And that’s one of the reasons the market is still soft — people realize it’s not a bargain.”

http://www.nytimes.com/2007/04/11/realestate/11leonhardt.html

I ALWAYS suggest that you try out this formula before considering buying or renting:

P*V = n*R*T

where
P=price
V=Volume of the apartment in square feet times height of the roof
R=Equivalent price for renting
T=Time period you'd own the apartment

if N comes out greater than 6.626E10-23, then it is better to rent
less than that it is better to own

actually, if you take the square root of N, then add 12, take the second derivative, and then rub your tummy clockwise two times, then you can usually get a 65% tax deduction on rent in any of the 50 states that beginning with a vowel.

Cough, cough, another hairball came up when I read that. Steve (or whomever) was mistaken again because, referring back to 10th grade chemistry, R is Avogadro's constant at 6.63* 10^(-23), not N which is just the number answer. Funny anyway. (p=pressure and t=temperature and v=volume, pressure is inverse to volume and temperature and volume are directly related). Oh, but Steve is correct, this formula is ALWAYS true :) lol

A lot of great advice here. I recently bought my first apartment (UWS large "junior" one bedroom in your range) and found the discussions on this board to be extremely valuable. I second kylewest's suggestion of becoming an insider on Streeteasy during the hunting process. It's a great tool for doing comparables in buildings and neigborhoods. Go back and read older posts (wade through all of the silliness and name-calling it's worth it) because there are also many insightful opinions offerred by people who are no longer posting. Good luck to you; I know the process is daunting.