Getting Started: How Much Cash Do I Need To Buy in New York City?

Piggy Bank

Oh no. There it is again. Your landlord is raising your rent to some ungodly number just so you can have the privilege of living in a top floor walk up in a building where the amenities consist of a door. Is it time to buy?

It certainly is! Of course I always think it’s time to buy, mostly because a) New York real estate is always a good investment and b) it sucks being a tenant. So the real question now is CAN you buy? How much money do you exactly need?

Let’s imagine that you found a $500,000 apartment with $1,000 a month maintenance charges (numbers chosen for easy math, like the kind I can do without a calculator). You know you’ve got the paycheck to cover your monthly mortgage payments and maintenance charges, but that’s all in the future. How much cash do you need to have on hand now just to get approved by a co-op board and close on your $500K apartment?

Down Payment Most co-op and condo buildings in New York City require a down payment of 20% of the purchase price. There are some that require more, like 25% or even 35% (these buildings tend to be found on the Upper East Side). Occasionally you may find a condo that only requires 10% down or even an FHA approved building that only calls for 6%, but I wouldn’t plan my sales search with those numbers in mind.Let’s go with the 20%:

20% of $500,000 = $100,000

Closing Costs A lot of things are covered in the big category called closing costs: attorney fees, title fees, court recording fees, any move in fees the building may require, etc. The amounts for each of these things can vary widely, so it’s pretty much impossible to give anyone a definitive number before the closing; as you get closer to the date your attorney may be able to give you a clearer estimate, but I would feel safe if I set aside $10,000 to cover everything. That may be way too much–it could be as little as $5,000–but I’d rather overestimate than underestimate. And if you end up with extras, you can go buy some candy (or a drink, because nothing says, “I need a drink” like a few hours of handing over large checks to attorneys).  So let’s say you need another $10,000


Savings to Impress the Co-op Board You’ve probably heard stories about co-op boards analyzing your reference letters for signs of character flaws, or asking difficult personal questions at interviews to find out if you will be the right kind of neighbor, but you know what they’re really interested in? How much money you have. You could have the best personality in the world and the heart of a saint, but if they don’t see that you a serious amount of liquid assets, that won’t matter one bit. Co-op boards want to be sure that if you lose your job, you’ll be able to cover your monthly maintenance fees for a year or two; The amount of years will vary from building to building. The seller’s broker should be able to give you some idea of how much the board would like to see. If it looks like you don’t have enough, someone will let you know; no one wants a buyer to go through the process of filling out a board package and waiting weeks for word on that if there’s little chance the buyer will pass financially. That would be a waste of time for both the buyer and seller. Let’s go with the two year number for our sample case:


…and Something Extra The co-op board won’t be that impressed if you only have $24,000 saved because they won’t believe that you may not do something like, oh, I don’t know, buy some furniture for that new apartment. Let’s throw in another $10,000 (and that’s probably skimping on things) just to show that you’re not going be pushed down to nothing if you have to tap into those savings.


Okay! Time to add it up:

$100,000 + $10,000 + $24,000 + $10,000 = $144,000

So yeah, to buy that $500,000 apartment, you probably should have about $144,000 easily accessible to you. Does that sound doable? Of course it does (provided you don’t work in the arts–but you knew that already). Now get ready to say goodbye to your landlord!

Stacks of Cash


Renting An Apartment in New York City–With a Pet

Okay, you have a dog or a cat or you plan to get one (or two–friends are great). That’s great! Life in New York is better with pets. Now how does that complicate your apartment renting experience?

Pet Friendly Buildings – Check Your Lease

Okay, so you found a building that you have been told is pet friendly and you’re ready to sign the lease. MAKE SURE YOU READ THE LEASE. Landlords often use generic leases and some of these have “no pets” written into them. The landlord might not even have noticed this because he (or an assistant) just printed a bunch f standard leases off the Internet without really looking at them. If you see that the lease says “no pets,” point it out, cross it out, and get the landlord to initial it. Better yet, get a pet rider added to your lease. Why is this important? Your current landlord might be okay with pets, but what if the building is sold? The new landlord might not want to have a pet friendly building, or might be looking for ways to get out current tenants so they can renovate your apartment and then rent it out at a higher rate. When the building is sold, the new landlord has to abide by the terms of the leases of the previous landlord. The new owners CANNOT tell you, “This is now a no pet building, either get rid of your pet or get out.” They also can’t start charging you a “pet fee” if your previous lease did not include one. (And for heaven’s sake, make sure you keep copies of your leases!!)

“No Pet” Buildings and the Three Month Law

Now what if you moved into a building that you were told was a no pet building, but you notice that other tenants have dogs or cats? This happened to me. I moved into a no pet building, but then realized that there were clearly a number of dogs in the building–at one count nine dogs in a twenty-four apartment building. The super’s family even had a dog. After a few years of staring longingly at my neighbors’ dogs (my roommate was allergic to cats, so that was out), I wondered why I couldn’t get one too. Luckily I happened to be working with someone who knew a lot about having a pet in New York, and he told me about the “The Three-Month Law” or “Pet Law.”

Officially known as ” Section 27-2009.1 of the Administrative Code of the City of New York,” (read the whole legalese here), this law essentially states that if your landlord or an agent of your landlord (the building super, a doorman, a plumber who comes to fix something in your apartment, etc.) sees that you are “openly and notoriously” (that is, not hiding) keeping a pet, he or she has ninety days to lodge a complaint. If the landlord does not file a complaint within those ninety days, you can keep your pet, free and clear.



In order to protect yourself, start accumulating evidence that you are “openly and notoriously” keeping a pet as soon as you adopt your dog or cat. Adoption papers and vet records are a good start, but photographs can really help you out. Put your dog or cat (though really, no one should have any problems with a cat in an apartment–why wouldn’t a landlord want to have help scaring off rodents?) in open and notorious situations, like on your building’s front steps, in front of your apartment door, with neighbors, and photograph him or her. The date stamped photos will provide bullet proof evidence that you are not hiding your pet and that you made it through the ninety days without any complaint.

...and notorious.

…and notorious.

(Of course this is all with the understanding that your pet is well-behaved and not causing a problem with your neighbors. If your dog is anxious and tries to bite people in the elevator, you have a problem. If your dog barks all day while your at work, you have a problem. If you are hoarding thirty cats and the smell is seeping into the hallways or the apartment next door, well, you have a lot of problems. Be a responsible pet owner and make sure your pet is a good neighbor.)

Final Thoughts

  • I will remind you again that the best thing to do is find a pet friendly building. They are out there and I haven’t noticed any difference in the rental rates between no pet and pet friendly buildings. If you have a broker who says that it’s too hard to find a pet friendly building or that there are “hardly any in New York,” find a different broker who understands how important your current or future pet is to you.
  • Don’t let a landlord evict you or try to make you get rid of your pet if you believe you are keeping your pet legally. Just google “NYC pet lawyers” and you’ll find help. Even if you think you can’t afford to hire a high-powered lawyer to take your landlord to court, you still may be able to find someone who will help you. I’ve found that the lawyers who specialize in this area are very willing to help in any way they can, even if it’s just tipping you off to the finer points of a law that might be enough to make your landlord back down.
  • And finally–If you do decide to go the route of bringing a pet into a building that isn’t “officially” pet friendly, then I am begging you with all my heart to please make sure you have a back up plan in case you can’t get your pet through the ninety days. When I decided to take that risk in my first apartment building, I did it with the knowledge that my parents would let my dog or me and my dog live with them until I found a new apartment that would allow me to have her. Please don’t put yourself in a situation where you may have to bring your dog or cat to a shelter. It is sad to see any dog or cat in a shelter; it is twenty times as sad when you look at them and know they have memories of a home where they were loved and don’t understand why they are no longer there.

Deal or No Deal? Making a Good Condo Investment in New York

Let's talk filthy lucre.

Let’s talk filthy lucre.

(I really hate the title of this post. It’s clunky and lacks wit, but I guess it gets the job done. Anyway, sorry about that.  And overall, this is going to be low on entertainment value…but sky high in information! So keep reading. I’ll try to make this as painless as possible.)

When my grandfather died, he left my dad some money. My parents used some of it to pay off their mortgage, then used the rest to buy a house at the New Jersey shore (or “down the shore,” as we like to say). He said buying shore property was a good investment, because they can’t build more shore.

The same can be said of New York City–they can’t really build more of it. Sure, they can continue to build up and try to find other ways to squeeze tiny residences onto our little island, but it’s a good bet that there will always be more people trying to live here than decent homes available (and if there is a time when people don’t want to live in New York, well, that probably means something really bad has happened and we may all have bigger problems than our rent). That means that New York real estate can also be a good investment. But when you’re shopping for a possible investment property, how do you know if you’re getting a good deal? Let’s think through this.

Bad news! Remember that old lady you used to cat sit for years ago when you first moved to New York? I’m sorry to tell you that she has shaken loose from this mortal coil. Good news! You’re her sole heir and it turns out that she had several million tucked away under her mattress.

Being kind to Princess Pretty Paws has paid off handsomely.

Being kind to Princess Pretty Paws has paid off handsomely.

Okay, you’ve used some of it to buy your own dream apartment, but now you have some leftover and you’d like to do more with it than have it just sit and rot in your savings account. You decide to buy a condo so you can earn some income from renting it out.

Here’s a good looking deal. It’s a one bedroom in a prime West Village location for $900,000 with monthly charges of just $900 (note: this is based on a real listing but numbers have been rounded for easy math purposes). Is it a good investment.

Aww, the West Village is so pretty...

Aww, the West Village is so pretty…

Step 1: How much do you think you can charge for rent? A quick look at rental listings in the same area show that you should be able to get at least $3,000 a month in rent. You may be able to get more–after all, the West Village is a super popular location–but let’s go with the low end of things.

Yearly income from rental: 3,000 x 12 = $36,000

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Q&A: What’s a Co-op? What’s a Condo?

nyc view from empire state bldgSome of these buildings are co-ops. Some are condos? What’s the diff?

Hello everyone! It’s great to see you here. And now, how about some questions from our audience. Anyone? Anyone? No? Okay, that’s understandable. You did just get here after all. So let me start?

Q: I want to buy an apartment in New York City, but I keep seeing things listed as co-ops. What’s a co-op? How is it different than a condo?

This is easily one of the most common questions that come up when people first begin their New York apartment search. So let’s get to it.

Co-ops: Co-op is short for co-operative, which, in most parts of the country, is a word you’re more likely to see on a kindergarten report card than in the real estate listings. However, in New York City it refers to a co-operative building, or a building that is owned by all the residents (see? people cooperating. It all makes sense now). When you buy a co-op apartment, you do not get a title to real property, as you would if you buy a house or a condo; instead, you buy shares in the corporation that owns the building. As a shareholder, you pay a monthly maintenance fee which contributes towards paying off the building’s mortgage, (if it still has one), the real estate taxes, and the upkeep of the building.

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