How To Make The Final Decision...
A: If you are stuck between 2 apartments, and not sure which one to take, buy the one that has the more space, is in the better location, and has the lower monthly charges. If one apartment has 2/3 of these factors in it over the other, than your decision is clear!
One of the hardest decisions you will have to make as a BUYER of NYC Real Estate, is: Which apartment do I take?
If your one of the lucky ones, then you will find exactly what you were looking for, which happens to be priced right, in the right neighborhood, has the right space, has low enough monthlys, and the perfect amount of light and views. In this case, its a no-brainer: Just Go For It!
But chances are this is not the situation you will find yourself in. So, we need to discuss what takes priority over what, and which amenities you should favor in making that final decision. As you read on, please know that I am assuming that the apartments you might be choosing between are all within your maximum budget! If you cant afford it, then you shouldnt buy it!
Since value of NYC Real Estate is measured mainly using an industry standard of price per square foot, RAW SPACE, should be the #1 factor in your decision. Since space is always an issue in this crowded city, finding the MOST space in the WORST condition in the BEST neighborhood is the religion of real estate masters. Let me repeat that: ...finding the MOST space in the WORST condition in the BEST neighborhood is the religion of real estate masters.
A very close 2nd, should be LOCATION. If you want to be near Central Park, and then find a great apartment that is only slightly too small than what you were hoping for, TAKE IT! However, if there is a noticeable disparity in size that is to be sacrificed for location, than SKIP IT! Use this formula to guide you in deciding whether LOCATION is worth it or not:
1BR / 1BTH
Under 100 Sq. Ft. Smaller ---> TAKE IT
Over 100 Sq. Ft. Smaller ---> SKIP IT
2BR / 2BTH
Under 175 Sq. Ft. Smaller ---> TAKE IT
Over 175 Sq. Ft. Smaller ---> SKIP IT
3BR / 3BTH
Under 250 Sq. Ft. Smaller ---> TAKE IT
Over 250 Sq. Ft. Smaller ---> SKIP IT
The final factor that should be used, and # 3 in my post here is MONTHLY CHARGES. It is vital to buy an apartment whose monthly charges are lower than its peers. I cannot stress enough the financial burden you will place on yourself by purchasing an apartment whose monthly charges (maintenance + TAXES) are much higher than any of its peers, and whose asking price WAS NOT REDUCED to compensate for affordability! Read my post, "High Monthly's! Find The Discount!" which talks about finding value in a property with higher monthly's whose asking price was reduced dramatically to compensate in a higher interest rate environment!
So, to sum up, here are the 3 most important factors to consider when making that final decision, in order of priority:
#1: RAW SPACE (Apartment + Outdoor Space)
#2: LOCATION (School District, Proximity To Park/Trains)
#3: MONTHLY COSTS (Lower Charges = Higher Value)
Factors that should NOT be taken into account when deciding between 2 or more properties are:
#4: Renovations
#5: Closet Space
#6: Desired Building / Friends in Building
#7: Gym/Roofdeck in Building
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Comments (1)
I am not from New York City but is interested in purchasing an apartment (ccop/condop).
1-Can you identify for me the best locations in Manhatten where the values will be retain despite the ebbs and flows of the market? The hot neighborhoods now?
2-I don't understand your formula of under X sq ft+take it vs over X sq ft=skip it?
Posted by Charlie E. | August 20, 2006 3:00 PM