Rent or Buy Apartments in Long Island City? NYC Real Estate!

When should you rent, and when should you buy? That's the million dollar question. This is because there are pros and cons to anything we do in life, wouldn't you agree? As your Realtor in Long Island City, I want to ensure that you are making the absolute right decision. I want to make absolutely certain that you know what you are getting yourself into when you buy or rent. Today we are going to talk about whether you should rent or buy an apartment in Long Island City.

Why Should You Rent?

One of the main drivers for renting as opposed to buying is the commitment factor. Renting as opposed to buying locks you in to a 12 month term usually as opposed to a 30 year mortgage life. Most home buyers usually finance their purchase with a long term mortgage loan that locks them into monthly payments which consist of both principal and interest to amortize it over the life of the loan.

The downside to renting is the glaring fact that you're not able to build equity on property, and won't be able to participate in the time value appreciation of property. Over the long term there is on average 3% home value appreciation YoY. Considering a long term mortgage term that also builds equity on property, which also has the potential to appreciate in value based upon the sales price you bought a property for; You are potentially losing out on the time value of money. That is, the time component of trading off money spent renting a property for a year, while building no equity in something that can be used for investment or familial purposes.

Both have its pros and cons. I'm not going to sit here and value shame you into renting or buying; But what I will say is that you have the option to create your destiny. Would you rather rent when you can buy when you have the ability to? Renters are mainly transients who either just recently moved into the area; or people who are building up their credit to hopefully eventually buy property of their own. The rental market's pipeline is full because of these consumers so they are much needed in order for investors and property owners to earn their living.

One reason why you should rent is to test the market and neighborhood. Can you envision yourself living here for the long term? Or do you envision yourself locking into a long term rent deal to secure your business for the long run?

Another question to ask yourself as a buyer is "would you rather not waste time trying to time the market by earning equity into a potential income producing asset or business?

The choice is yours.
Rent or Buy Apartments in Long Island City? NYC Real Estate! Rent or Buy Apartments in Long Island City? NYC Real Estate! Reviewed by Alex Sung on July 09, 2020 Rating: 5

No comments:

Powered by Blogger.