Everybody wants to live in New York City. It offers the complete package: world-famous sites, trendy restaurants, vibrant nightlife, and a distinct local culture, among other things. But in a city that is also home to a massive real estate market teeming with options, it can be difficult to choose to rent or buy a home. Let’s explore your options thoroughly before you come to a decision.
Advantages of Buying a Home in NYC
- Increase in Equity
If you are keen to build your home equity as early as possible, buying a home will get you started. As you pay your mortgage, you will own more of the home. Equity can also increase over time through appreciation. And because of New York City’s highly-desired location and attractive lifestyle, property values continue to increase over the years.
- Tax Benefits
As a homeowner, you are entitled to certain tax benefits like deductions on mortgage interest and property taxes. Such tax breaks can also allow you to deduct a certain amount from your federal income taxes.
- Opportunity to Rent
Instead of being a tenant, you can become the landlord. By turning your home into an investment property, you can earn rental income that you can use to pay your mortgage or build a retirement plan.
Advantages of Renting a Home in NYC
- Minimal upkeep and maintenance
Good tenants look after the properties they’re renting, but the bulk of maintenance and upkeep falls on the landlord or property manager’s shoulders. If you don’t want to deal with repairs, upgrades, and the unexpected costs of owning a home, then renting is the best option for you.
- Flexibility and mobility
Once your rental lease is up, you have the freedom and flexibility to switch to another place. Owning a home, on the other hand, may require you to find tenants or sell the home if you do not intend to live there any longer.
- More time to improve your finances
Planning to buy a home in the long run? Renting a home allows you to pay off your debts and increase your savings before making a huge financial commitment like buying a home.
Determining What’s Best for You
- Figure out the length of your stay – Your work, lifestyle, and long-term goals play a huge part in determining whether you should buy or rent a home.If you think that you’ll be based in New York City for a while, then buying a home would be most ideal. According to StreetEasy, the city’s tipping point (the number of years before a home purchase is paid off) is around 5.6 years. Otherwise, you’re better off renting instead.
- Assess the local real estate market – Take a look at New York City’s current real estate market and evaluate the market conditions, the recently closed sales, and the sales trends. This will tell you if the market is more favorable towards buyers or renters.
- Work with a qualified real estate agent – To make an informed decision, work with a local real estate agent who knows the area well. A good agent will help you determine your best real estate option and work with you to reach that goal.
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