Should You Rent or Buy an Apartment in NYC?

Moving to a different apartment in the Big Apple is an exciting prospect, whether you are a newcomer or an experienced city dweller. 

Each corner of this sprawling city offers varied apartment styles. No matter your taste, there is a space for you, from multi-floor high rises on 3rd Avenue in Manhattan to spacious Brooklyn brownstones. Yet as you check out apartments for rent, you should think about where you are in life and if you are ready to invest in your future if you plan on staying. And what better place to buy a home than New York City.

There is a lot to think of when weighing this decision to rent vs. buy, and some folks do not know where to start in the real estate market when they decide to buy. But getting out of the rental market is not easy. 

Below, we share a quick guide to help New Yorkers figure out if renting or buying works for them.

Do you know your favorite areas?

Many long-term renters experiment with living in different parts of the city, even if it is just in one borough. 

Someone spending five years in NYC can live in many locales. Manhattan neighborhoods alone offer varied lifestyles, from the Upper East Side to Greenwich Village. Plus, all of the great choices in Brooklyn as well as Queens.

Some folks like to keep the thrill alive and continue trying out different parts of the city. But if you get tired of canceled checks and hitting the pavement each year to find a new rental, you can use your knowledge to figure out what part of NYC is right for you. 

Once you've squared away where you want to live, it's time to weigh whether you are ready to commit to purchasing a property. 

Are you secure in your career? 

Everyone wants to make it big in NYC, from lifelong residents to folks just moving in. And there are many paths to achieve these dreams, ranging from the arts to finance. 

Depending on where you are in your career, it may be time to consider making a permanent commitment to life in New York. Job security is a powerful motivator, and if you know you are not leaving your role anytime soon, that might be a sign it is time to purchase and ditch the rental lease. 

Building equity is important and investing in NYC real estate gives you a chance to make a profit on your investment should you decide to sell down the line. But if you are on the fence, just know that interest rates on mortgage rates are rising. Because while renting allows for freedom in the short term, it does not build your wealth. Yet buying property is not a fit for every career. 

If you move every few years for work or travel, you may want to continue renting and invest your hard-earned money into other ventures. 

How do you plan to use your savings? 

Part of having a successful career is building up your savings. And when weighing the option of buying or renting in NYC, you have to think about how you want to deploy your nest egg. 

Do you want to be liquid and free to use your money for investing in the stock market or other assets? This fiscal style fits people who do not want to be tied down to one place. Yet the drawback here is that if you invest your money into volatile holdings, you stand to lose if there is a downturn. By investing in a condo or coop, you make a safe, long-term purchase that will likely weather most financial calamities. 

Of course, the drawback is that you are now wedded to NYC and cannot move to different neighborhoods on a whim. You should sit down with a financial planner and see how you can feasibly use your money. The last thing anyone wants is a decade of canceled checks and no gain in equity, either through homeownership or netting a surplus from stocks. 

But while you have to consider what your money will do, you should also consider if you are ready to dedicate time and money to the upkeep of a property. 

Are you ready for the responsibility of owning? 

Owning a property is no walk in the park, and if you have rented for most of your life, the responsibilities of homeownership can be a shock. 

Of course, owning an apartment in NYC means you don't have to care for a large lawn and backyard, but there are other ways you have to care for your space. Inside your unit, you have to keep track of the electrical systems, plumbing, cooling, heating, and appliances. And you can't forget about caring for the state of your walls and flooring, too. 

If you look to scoop up space in a swanking high-rise condo in Downtown Brooklyn, you will also face monthly common charges in addition to your mortgage and property taxes. But the good outweighs the bad when buying a condo, as you can rely on the building staff to take care of all the amenities and common spaces.

But depending on where you are in your life, getting your own space can outweigh the tedium of responsibility. 

Has a life event changed your needs? 

Beyond having a stable career and a substantial savings account, there are other reasons why you may purchase an apartment in the city. 

Whether you want to upgrade your place or start a family, you will likely need extra space. Plus, you may not want to worry about renewing a lease each year.. Or, if you have friends or family that visit a lot, you will eventually want to get a place with a second bedroom for your guests. Depending on your needs, the high purchase price of a home, combined with a costly broker fee are worth the invested capital.

Yet not everyone is motivated by family planning or guest rooms. If you are an outdoors enthusiast, having space is essential for storing and maintaining gear. Keeping a car out on the street is stressful, and a dedicated parking space for a vehicle can inspire long-term renters to make the switch to buy as well. 

Interested in buying an apartment in NYC? Browse listings in your favorite neighborhood and see how much you can save with Prevu’s Smart Buyer Rebate.