We sat around as a team recently to discuss the reasons why our customers are purchasing apartments right now. If you’re too distracted by the noise pretending to be news, this is for you.

Here are our Top 10 reasons why buyers are buying in NYC right now. Enjoy- Scott

#1 New York City is Awesome 

I don’t have to say this, do I? Everyone wants to be here. And regardless of the market, people want to soak in the culture, and grit, and the lifeforce that’s here. People buy apartments in New York sometimes because it’s a practical thing. But more often than not, it also signals You Have Arrived. Buying, then, is not only for the smart money when it’s a buyer’s market. It’s also aspirational. Need I go on?

#2 It’s more expensive to rent.

This isn’t true in every case, but it is in some. Obviously when 50% of the market is paying cash, it’s going to be cheaper to own than to rent (before factoring in what your money could be earning elsewhere). But if you’re financing 50-75%, there’s a non-zero chance, especially with 1- and 2-bedroom properties in Brooklyn, that the math works well. That’s why we’re seeing bidding wars in many places.

The $6000/month rental studio has driven some parents to help buy for their kids, too. It’s a slightly different reason- that of parents wanting to stop wasting money on rental, and start their offspring on the property ladder (more on that below).

And don’t forget that people will end up refinancing in a year or so.

#3 Endlessly Rising Rent

If you’re on a fixed income as you get older, and you’re renting, it may just be time to lock in some of your costs. There’s a sense that if you can limit your exposure to the vagaries of landlords and the rental market, you’ll be better off. You’ll certainly sleep better at night, and you may have a better investment, or a more diversified one, too. And, more than likely, your monthly charges will go up more slowly than your rent renewals.

#4 Rates are stabilizing 

Mortgage rates feel like they’re starting to stabilize for many buyers. When they start coming down, guess what goes up? Apartment prices. That’s a signal that’s easy to understand. Though not everyone agrees, many are not waiting to be 100% right. They’ll be late to party if they hold off.

#5 “Prices Feel Below market”

Many buyers are seeing a flood of buyers once a seller reduces to a certain level. They aren’t quantifying to the same degree and other, more data-oriented buyers. But they simply feel that when prices are below what sellers paid 3, 5, or 15 years ago, that they want to take advantage of low prices. Do you agree? Or do you need more data?

#6 It’s a Great time to create value 

When the market is 5-10% below peaks, doesn’t it just seem like a great time to get involved in the market? You can get a massive discount on an unrenovated property, and make it your own, too.

There has always been appreciation in New York City Real Estate over a long enough time horizon. Better to buy low, when it’s obvious it’s at a low, than wait for prices to start climbing again. Don’t forget you have a life you want to live. But more on that below.

#7 The Mountain vs the Ladder

Which would you rather climb, a ladder or a mountain?

Many people feel that getting in the game now, into a smaller apartment, will give them an easier time to climb to the next size up in an apartment. Rationally, you may point to extra closing costs and the difficulty timing market cycles. But what about the psychology to overcome when you need to go from renting to buying a $1mm apartment? At least with the property ladder, you are saving bit by bit. It becomes scarier the longer you wait. Choose the ladder over the mountain.

#8 More On Throwing Away Money

Would you rather be 100% guaranteed to throw money away on rent, or spend a little extra on a higher mortgage rate for a little while – and have it be tax deductible? Not to mention you’ll get to refinance in a little while, and get the appreciation of holding the property.

#9 Asset Allocation/Diversification

If you’re the type who needs a numbers argument, think about the value of being diversified. In a moment when the stock market could go up or down, what is smarter on a risk-adjusted basis? Putting some of your money into real estate when it’s lower than it’s been since COVID, or keeping all of it in the stock market?

#10 Less competition

Whether you’re buying all cash, or taking a mortgage, this is a moment when you have a little time to deliberate over your purchase. There are fewer buyers in the market, and hence less competition. This makes for a less pressured environment- unless the apartment is a steal- and then it’s always competitive. Welcome to New York.

So there’s your list.

Thanks to the rest of the team for crowdsourcing buyer mindsets right now.

Do you disagree? Agree? Have more to add? Tell us what you think! Thanks! -S