Rent vs buying

Amazon
lololllo

Go to company page Amazon

lololllo
Jun 27, 2021 8 Comments

Before nyc housing price recover fully, im planning to buy house

Current rent: 3800
Target proce of house purchase: 1.5M
Mortgage plan: 1m, rate 3.1%

That means if i buy house, will need to spend ~ 6000 per months for hoa, prop tax, and mortgage.

Certainly i will pay more than what i am now but is this worth? Tax benefit will be small (~8900usd gain after tax)

Especially when nyc housing price is not drastically moving up, i am seriously wondering what would be the benefits i can have by purchasing

comments

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TOP 8 Comments
  • Google
    Rilakkuma

    Go to company page Google

    Rilakkuma
    Keep in mind that if the price moves up 10%, that means a 150k return on your 500k down payment plus interest paid on mortgage, which is like a 20-25% return.
    Jun 27, 2021 0
  • HSBC
    uGzI30

    Go to company page HSBC

    uGzI30
    Is the approx value of your current rental also 1.5M for comparison? I too can't see the value in buying in NYC except for 30+ years down the line..
    Jun 27, 2021 1
  • You are locking in costs by buying while rents will
    Continue to rise indefinitely. Think of buying more as a hedge against rent inflation and inflation in general than an immediate cost benefit analysis.

    Then there is the social aspect.

    Only reason not to buy if you can afford it is if you don’t want to settle
    Down for >5 years
    Jun 27, 2021 0
  • I think if it’s about the same as your rent after tax benefit and principle portion of your mortgage payments then it is worth it. Also it is probably an upgrade from your rental so you have to consider that benefit too.
    Jun 27, 2021 2
    • Amazon
      lololllo

      Go to company page Amazon

      lololllo
      OP
      So are you saying that quality of the house might be better but in terms of monetary it wouldnt be that beneficial?
      Jun 27, 2021
    • In terms of monetary I think you will be paying more even after deducting the tax benefit and principal portion but you have to decide if the increase worth the upgrade of the house or quality of living.
      Jun 27, 2021
  • New
    XIwo14

    New

    XIwo14
    It depends on what borough you go for in NYC. Property values have had a steady increases in Brooklyn since the early 2010's. You can find a nice house in Riverdale/Pelham up in the Bronx area for a good price. I'd say owning long-term yields better investment because eventually all you'll have to pay are taxes/HOA (if you go for apt vs house). If you get a duplex you could rent or Airbnb for passive income that can cover % of home ownership.
    Jun 27, 2021 0