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How do I know if I should buy now?

From an Oct. 2006 piece I did for the New York Blade. The Blade has a mostly gay readership, but I think this advice applies to straight people too:

“…media reports aside, the ‘Should I buy now?’ question is also hard to answer for two reasons: 1) if real estate agents could predict the future with absolute certainty, we’d spend all our time at the track; and 2) gay people have children less often than straight people, and gay couples are more likely to keep separate apartments than straight couples, so there’s less pressure of ‘help I’m getting married/having a baby, I have to move next week.’
If you’re lucky enough to have the option to decide when to move, you probably should buy now if:

* You have a chance to buy in a neighborhood you’ve been eyeing. While new luxury condos are getting thrown up every ten feet (look, hon, there’s one in the backyard) it can be argued that their arrival will strengthen fringe neighborhoods like the Lower East Side and the West 30s. You can be a pioneer and have your granite countertops! Just be warned that if gentrification isn’t really successful, being in a poor school district might hurt your resale. And if gentrification is really successful, the riff-raff will follow you.

* You have a shot at generational wealth transfer. At today’s prices, mom and dad (or grandma and grandpa) are often asked to pitch in, and there are different levels of involvement: You can receive gifts of $11,000 per donor, tax free, each year; you can get a larger, taxable gift of down-payment assistance; or you can get a relative to co-sign your loan (which means they’ll have to get approved by your co-op board.) Some buyers don’t want to lean on their families, but I feel if they want to help you while they’re still around to see you enjoy it, fantastic. (And, hey, do you mind having them call my mom?)

* You think prices make sense versus renting. It’s always tough to say what prices will do in absolute terms: will they go down ten percent? Stay flat? Jump back up? But you can tell what else you can do with your money. If you have a professional income and need the tax break, buy. If you’re renting space that would cost you twice as much to own, for heaven’s sake keep renting.”

Posted in For Buyers and For renters 13 years, 10 months ago at 2:48 pm.

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