Good luck on the search - NYC is its own animal when it comes to real estate. $700,000 isn't going find much except maybe a studio. I've seen 1 bedrooms in that range but they are generally undesirable units in an otherwise nice building. Plus you still have the maintenance fee's and taxes.

I'm not an expert but my opinion is the NYC housing market isn't a deal right now or even a fair value. I'm not saying it's a bubble, but it's certainly not cheap. If I stay here I'm just going to keep saving and see if I get lucky with a housing dip and my savings intact.

Plus, if you buy into a co-op (more common in Manhattan I believe) the purchase requirements are steep. Often 30% down, 2 years mortgage/maintenance/taxes in liquid cash available, among other things. High entry requirements but creates some stability.

I really think renting is cheaper than buying in NYC right now when you factor in all the costs. You get a nice tax write off with owning, to be sure, but it's a wash I've figured. I don't see how prices can keep getting higher and higher right now. But I thought that 4 years ago too in places in Brooklyn and I was wrong.

What's funny is my only other real option is to move to London since my wife is from there and would eventually like to move back I think. Their housing market is in fact a bubble and I simply wouldn't buy anywhere near there right now.

I agree it's not a fair value right now. Brooklyn is certainly in a bubble, or if not a bubble, a period of aggressive overpricing. I don't think prices are going to fall, causing one to lose money if they buy right now... but I also don't think that you're going to resell your $1M one-bedroom in Gowanus for $2M in 5 years. Objectively, that's a lot of money.

You're definitely competing with households that have two incomes, hence 3 million dollars being spent on one bedroom apartments. If you have a household income of $1M a year pre-tax, certainly a possibility for two programmers mid-career, then you have a lot of options.

Personally, I don't care about living in New York except that my job is here, so it may be nearing the time to move back to Chicago.

Seems like you should be able to get something decent for $800,000 [which matches up with my understanding of what a 1br costs on UWS].

http://streeteasy.com/for-sale/nyc/type:D1,P1%7Cprice:700000...

Note, I could be wrong. These could be the worst places you're talking about. But it seems like there are at least a few around 800k, and the housing market moves fast [so you'll see lots of options if you look for a couple months].

So, to buy a co-op for $800,000 you need:

20% down: $160,000 24 months mortgage in the bank: $68,000 24 months maintenance/property tax in the bank: $36,000

For a total of $264,000 not including closing costs. I don't have $264,000 lying around at this precise moment.

$600,000 is my real budget. $700,000 is for searching and getting an idea of "what if I wait another year and save up some more money".

All in all I'm not that excited. My apartment that I rent for $2500/month is way better than any of those places that turn up. And by "way better", I mean "still an embarrassment compared to the house I grew up in when I was a kid, that cost less than the down payment for a studio in Brooklyn". I don't even have a microwave.

Not to mention even if you have every lined up you can still get rejected by the co-op board and they don't have to give a reason. They go through all your personal details and it's a bit odd living with a bunch of people who know everything about you but you're not able to learn anything about them.

20% down is usually the bottom. A lot of places want 25% or 30% down and there's also a chance you're going against someone with 100% cash and the board will pick them nearly every time.

Lastly, if you're using every dime you have so you get a mortgage well over 500k that may be a bad choice. The opportunity cost of tying that much cash up into a mortgage is a lot of risk (all your net worth in 1 investment) and you're unable to use that cash to make other investments and leverage them if need be.

Indeed.

I don't look at real-estate as an investment, but rather as a sunk cost. I need somewhere to live, I want to screw around with walls and plumbing fixtures when I feel like it, owning seems like the right option.

Of course you don't actually own your co-op, you just own shares in a company that actually owns your property.

Agreed :/

Housing sucks.

But to nit; I believe a coop is only 10% down (condos are 20%. Either way it doesn't really change your math). And I'm still years from being able to buy a place in NYC, so sigh

You will never find a co-op that lets you be a member at 10%. 20% is the minimum I've seen and usually you're looking at 25% or 30%. And there's a chance someone with all cash will simply be a better fit for them.

Please find me a Co-Op in NYC that lets you in with 10%.