High Rents Create a New Homebuyer Mentality
Buying Manhattan property has never looked so appealing. As rents in the city soar to record heights, the price gap that separates renting and buying an apartment is currently the smallest it’s been since 2006. And with Manhattan still exhibiting the highest cost of buying relative to renting in the United States, the fact that renting apartments is falling in popularity is truly saying a lot. Yet for many residents, buying property with a mortgage is beginning to seem immensely preferable to paying ever-increasing rents. While residents are showing more and more distaste for continuing to rent property, there’s an increasing willingness to bite the bullet and buy a condo or co-op.
Current renters in the city have to deal with their landlords constantly increasing the rates of rent, putting them in a very vulnerable position. Many residents in Manhattan rental apartments no longer want to continue the hassle of dealing with surging rents every time they renew their lease or sign a new one - the latter option is getting exorbinantly costly - especially while the right Manhattan condo for sale can potentially offer lower prices than staying in a rental apartment. This buying process is being helped along by the fact that mortgage prices continue to fall, reaching a record 3.67% recently. The rental market is headed in the exact opposite direction: Manhattan apartment rents continue to grow and are expected to increase by 6.7% through December.
Besides basic affordability and differences in price, buying a Manhattan condo holds potential opportunities for economic benefit. If a homebuyer were to maintain a property for just three years, he would be able to sell it for a better return on his down payment than if he had invested while renting a property. The main factor currently holding many back from buying an apartment immediately is a pricey down payment, but many condos now offer listings that are somewhere in the range of half a million dollars. With mortgage rates as low as they presently are, buying a Manhattan condo is becoming more sensible than ever.