Buying an Apartment in Brooklyn - 8 Mistakes to Avoid
By Thomas Kutzman on January 21, 2024
The decision to buy an apartment in Brooklyn can be an exciting and overwhelming moment in your life. You are buying your part of one of the most historic and hip boroughs of New York City.
Whether you are looking to buy in Brooklyn Heights, Bay Ridge, Fort Greene, or Williamsburg, there are several avoidable mistakes that you need to be aware of before you buy.
Below we’ve outlined the top eight mistakes to avoid when buying an apartment in Brooklyn.
Mistake #1: Not having a buyer’s agent
For many people, buying an apartment or home is the largest transaction of their lives. While you may be a financially savvy saver with experience in large transactions in your work life, you’ll still want to have a dedicated buyer’s agent representing you that is involved in real estate transactions every day.
A common mistake buyers make is to interact directly with the seller’s agent. While these seller’s agents may seem very polite and helpful, you should be aware that they represent the seller’s interests, not yours. Given all of the nuances of a real estate transaction, you will want to have your own buyer’s agent to be your advocate through your buying process.
Choose a buyer’s agent that is experienced and is knowledgeable about the area of Brooklyn you are interested in.
Mistake #2: Not asking for a commission rebate
The biggest mistake buyers in Brooklyn can make is not asking their buyer’s broker about commission rebates. The way a commission rebate works is that the broker that represents an apartment buyer refunds a portion of the commission she receives directly to the buyer.
In places like Brooklyn, that can mean tens of thousands of dollars going back in the pocket of the buyer. Commission rebates are legal in New York and 39 other US states, and are a way for buyers to save significantly on the cost of their apartment purchase.
Don’t leave money on the table, ask for a commission rebate. Prevu, a modern brokerage in NYC, rebates up to 1.5% of a buyer’s purchase price in the form of their Smart Buyer commission rebate in all five boroughs, including Brooklyn. Prevu has saved New Yorkers millions of dollars to date, and homebuyers save an average of $23,000 per transaction.
Mistake #3: Choosing a traditional vs tech-enabled brokerage
Real estate is changing rapidly thanks to technology, however traditional brokers are providing the same antiquated and fragmented experience they always have.
If you are a busy professional with a limited amount of time to dedicate to your Brooklyn apartment hunt, select a tech-enabled brokerage that is more with the times. These modern brokerages save you time by streamlining the buying process for you. Everything is in one place online and the brokerage provides you with tools that make your purchase easier and more collaborative with your agent.
Mistake #4: Forgetting to plan for closing costs
Apartments in Brooklyn aren’t cheap, and it takes time to save up the money to make such a purchase. Unfortunately, many buyers don’t research all of the costs that are required for a purchase, and are surprised to learn they don’t have enough saved up.
When planning your apartment budget savings plan, you will need to account for more than just your down payment. There are also significant closing costs when buying an apartment in Brooklyn.
Brooklyn co-op buyers should expect to pay about one to two percent of the purchase price, or two to three if the Brooklyn apartment costs more than $1 million. As for Brooklyn condos, expect two to four percent as a safe range for these costs. New developments, which you are likely to find in areas like Downtown Brooklyn and Williamsburg, can have closing costs that are much higher, in some cases above 5% of the purchase price.
To estimate closing costs on your Brooklyn apartment, check out Prevu’s closing cost calculator for buyers.
Mistake #5: Not considering re-sale value
Far too often, buyers fall in love with an apartment that solely fits their needs and tastes. Yes, it is good to have such affinity for a place, as it will be your home for potentially a long period of time. However, considerations like quirky layouts or inconvenient locations not easily serviced by public transportation may be problematic later.
It is important to remember that life changes and one day you may find yourself selling your Brooklyn apartment to someone else. Before you buy, ask your real estate agent about the pros and cons of the unit as it relates to potential re-sale value down the road. That way you can make a more informed decision.
Mistake #6: Skipping a home inspection
It is never a good idea to skip a home inspection. Some apartment buyers, particularly co-op apartment buyers, wrongly assume that the building takes care of everything so they choose not to have an inspection done in order to save money.
You should always get a home inspection completed when buying an apartment in Brooklyn. It is a small price to pay for peace of mind. An inspector will check that appliances are functioning, building systems and roof are in good condition, and see if there is anything hiding beneath the surface that their professional tools may spot.
You want to minimize any surprises before you buy.
Mistake #7: Ignoring urban planning news
When buying an apartment in Brooklyn, your real estate attorney will perform due diligence on the transaction with a focus on the building and the unit. Typically, this diligence process includes a review of the building’s offering plan and financials, confirmation of building permits and records, title search, and much more.
In addition, you want to walk around the area and specifically ask your attorney to investigate any potential development in the neighborhood or on any adjacent vacant lots. With the rapid development of new construction condos in Brooklyn over the past decade, you want to understand how new projects might affect your day to day life.
This is especially true if your Brooklyn apartment has great views. You don’t want to wake up one day with a new building across the street blocking your views and potentially affecting the value of your apartment.
Mistake #8: Proceeding with a bad deal
Even if you achieve an accepted offer on an apartment in Brooklyn, it is not binding until both you and the seller sign a formal contract. If anything arises that makes you feel uncomfortable before signing the contract, it is within your rights to walk away.
For example, if there are structural problems discovered during an inspection or irregularities with the building’s financials found during your attorney’s due diligence, you may want to consider backing out.
Buyers can sometimes get caught up in the moment, fail to voice their concerns, and proceed with a bad deal. Don’t make this mistake! Whenever in doubt, share your thoughts with your real estate agent and attorney to evaluate your options before regretting it later.
Ready to buy an apartment in Brooklyn?
Now that you know all of the mistakes to avoid during the buying process, you are ready to start your search. You can browse listings in Brooklyn with Prevu and begin receiving property alerts as soon as the newest listings hit the market.
