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Updated almost 9 years ago,

User Stats

3
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0
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Brian Smith
  • New York, NY
0
Votes |
3
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Seeking Opinions: Rent vs. Buy in High Priced Area

Brian Smith
  • New York, NY
Posted

My wife and I are in our mid-40’s with a small child and renting in Westchester County, New York - basically the high cost of living capital of the East. We are a single income family and, while my salary meets our basic needs with some room for recreation, we are by no means getting way ahead living here or anywhere near this area, for that matter. And by New York standards, we are living cheaply.

The main reason we are here is because of my job. The income is OK (very good for most anywhere else), but the work is great, opens many doors that would otherwise not be, and comes with a small pension after we retire. That retirement, ready or not, comes about 14 years from now and the thought of leaving for something else isn’t really on the radar right now.

Transferring is possible, but difficult and if/when this might happen is tough to predict. Bottom line: we are here for at least a little while, possibly the next 14 years. We have no intention of sticking around and being taxed to death after that, however.

This gets to my question: assuming we could afford it (big if) and given our timeline (uncertain), is it worth buying in a place like this?

We definitely *want* to own something and god knows we’re desperate for the space. (My son sleeps a few feet from my head.) More importantly, it would hopefully give us something to sell at a profit when we leave. And we are both well aware of the dangers of being exposed to rent inflation for the next X years with nothing to show for it after.

On the other hand, I have no intention of ever living n a home that owns *me* and buying here definitely comes with that risk. My landlord, who is very handy (we are not) offered up some advice that he got when moving here years ago: basically, don’t get into a single family home here, because it will kill you. Another friend, who made a part-time thing out of flipping real estate, had similar advice. He describes buying and selling in other places as relatively painless by NY/NJ standards, but won’t bother here - mainly because of taxes and the endless numbers of hands in his pockets. This scares me, to the point where it almost seems the only way to win the race here is to avoid it altogether.

I’ve heard many times that buying is generally not worth it if you don’t expect to stay put for at least 3-5 years to recover closing costs, and am sure that rule goes double here. Given that and the unknowns with our length of stay, I see the choices boiling down to this:

1. Buy a probably overpriced home with huge closing costs, taxes, and the whole money pit - and hope/pray for the best on the back end, whenever this is. Or…

2. Continue to rent as cheaply (and as cramped) as possible, save and invest what money we can and hope for the best this way.

So which is likely to be the smaller sh*t sandwich? Seems the longer we stay, the more worth it buying becomes, but neither of us have owned a home before and the pitfalls are obviously huge in this market. If anyone has the time, some more experienced opinions than ours would be appreciated.

Thanks for reading!

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