Renting and Leasing
ALTERNATIVES TO BUYING A HOME
If you’re relocating to the New York City (NYC) area, you may not be ready to purchase a home. Luckily, NYC is one of the few cities in the world where it’s common and acceptable for residents to rent or lease for a lifetime. Living in NYC is expensive no matter which form of housing you choose, and renting a unit can be a daunting task. Most first-time apartments hunters often are shocked at how little they get for their money—the overall cost of living here is 364 percent more than the national average. Still, according to the latest U.S. Census, 67 percent of NYC residents opt to rent rather than own.

An average apartment rental rate for a one-bedroom, one-bath apartment is $1,950 per month; for a two-bedroom, two-bath apartment, the average rate is $3,350 per month. Studio rent in the city typically falls in the $1,500 range. You may find cheaper apartment options by expanding your search away from the most popular neighborhoods. Whether you’re looking for an apartment, a townhouse, a mid-rise, a high-rise, condo or a single-family home, you’ll find a unit to suit your tastes and lifestyle in NYC.

Here are a few considerations when determining if you should rent or own:
  • Cost: Buying a home usually requires a substantial investment of cash for a down payment, closing costs and points paid to lenders. You also may need to buy appliances, additional furniture, window coverings and other items.
  • Additional Costs: With a home, you may possibly have a yard, a community pool or other amenities and more space. You’ll also be responsible for maintaining the yard, heating and cooling a larger space as well as perhaps paying homeowners association dues to maintain the pool and other amenities.
  • Flexibility: If your company relocates employees frequently, or you’re not interested in staying somewhere for more than a year or two, you may want to think twice about buying. The costs you incur to sell a home (e.g., realtor fees, closing costs, costs to market the property) may outpace any gains in the property’s value or selling price.
  • Not Ready to Commit: How likely is it that your life and your needs will change? Is your family growing, or do you have children who are getting ready to leave home or go to college? Is divorce or separation a possibility in your near future? Will there be other demands on your income or savings? 
  • Return on Investment: Most people believe property always appreciates or gains value, but that’s not always the case. A change in the neighborhood or the economy can affect the value of your property, which is certainly an issue currently. Sometimes you’ll make money as a result, but you may lose money on your investment if you haven’t owned the property for long. You’ll also need to consider any additional money that you put into the property for improvements or upkeep while you live there. 
  • Maintenance Responsibility: Home ownership requires being responsible for making the repairs or hiring others to make them, being available when repairs need to be made and paying for the repairs. 
  • Lifestyle Factors: Is the neighborhood you’re interested in affordable with an adequate selection? Is it close to your work or school? Can you find rental housing where you would like to live, or is a home you buy the only option? 
  • Taxes: If you itemize your income tax, you can deduct interest you pay on a mortgage and property taxes that you pay. You also can deduct points paid to lenders in the year that you incur that cost. If you don’t itemize, you won’t get these deductions. 
  • Peace of Mind: Ultimately, you need to decide if you’ll be more satisfied and comfortable in a home you own or in a home you rent.

GETTING ORGANIZED
Now that you’ve determined that renting is your best option at this time, it’s time to get organized. Are you prepared to submit a rental application? Review this list to help you prepare.
  • Your Budget: Establish a rental rate you can afford. Don’t forget that you may need to pay for utilities and other items not included in your rent. Many properties will not approve you as a resident if you’ll have to spend more than a third of your gross income on the rent.
  • Your Credit: Check out your credit record with a report from a consumer-reporting agency and be sure to clear up any problems or mistakes on your record before you fill out a rental application. 
  • Prepare Paperwork: As you apply to various complexes or realty firms, have the following information readily available so the application process can go smoothly. 
    • Current and former addresses
    • Current and past employment with dates and contact phone numbers
    • Credit references
    • Copy of your credit report (if available)
    • Bank information
    • Your checkbook; you may be required to pay a security deposit
    • If you have pets, expect to pay a pet deposit

STAY FOCUSED
Before you start looking and comparing properties, determine your needs. Do you need a place with lots of space, good closets, or proximity to work, school, shopping or public transportation? Are you looking for a neighborhood with a suburban feel or do you prefer being closer to higher density, urban areas? Then, of course, determine how much space you need and whether you’ll need a storage space for extra furniture. Are you interested in a specific school district for your children? Is there a washer and dryer in the rental? How is the traffic leaving your neighborhood in the morning and at night?

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