Apartment living in the past was thought of as a steppingstone. Either a stop gap in saving for a house or possibly a temporary rental until deciding on a location to choose that worked before buying a house.
In today’s world—at least in the frum world—utilizing the option of either purchasing or renting an apartment has become part of a more long-term plan as opposed to a place to live and just hope for the best down the road.
I therefore decided to take the opportunity to discuss more fully the different types of apartment options buyers and renters are looking for and how they are financed.
While in Manhattan there are many varieties of apartment types as well as buyers with countless differences in what they are looking for, I am going to focus more on what is going on in the Five Towns/Far Rockaway community arena.
In our community buyers are more or less divided into two categories. The first category tends to be either young couples or singles starting out, wanting to own something in the neighborhood such as a co-op or condo as a hold on their place in the real estate market. Many of them have grown up in the area, have family in the area, and want to stay here.
The second category tends to be buyers whose children are now out of the house, who are ready to trade the large space of a house with all its maintenance for an apartment with low maintenance.
Buyers in this category can also be those who now spend winters in the sun and summers here in the north and also usually have children in the area and want to be able to walk to them.
By purchasing an apartment, be it co-op or condo, they are able to have their own place as well as a real estate asset. An apartment owned is one that you can invest in and still enjoy.
Updating kitchens and baths or installing closets, closet systems, carpentry, or other special detailing can be done to the owner’s needs and taste and create additional value in the apartment much in the same way as a house except on a smaller scale.
Alternatively, in a rental apartment they are living in a space belonging to someone else. Most people usually do not want to change or invest their own money in a rental other than to paint or put down a piece of carpeting. Putting down roots in a rental is also an unknown in many ways. How long will I be able to stay here? Can I get a lease for longer than 1–2 years? How much will the rent go up when my lease is over? These are all uncontrollables.
What about the differences in apartments? Should I consider a co-op or a condominium (condo). A co-op tends to be cheaper than a condo, although a condo gives you an actual real estate asset as opposed to a co-op, which gives you an apartment that is a share hold (meaning a certain number of shares owned, like stock) in the building which is why it is called a “cooperative.”
What about getting a mortgage on a co-op or a condominium? Condo mortgaging is priced by lenders very similarly to 1- or 2-family houses. Co-op mortgaging is a little more varied, it can be similar but more often is slightly higher priced and also is subject to the financial position of the entire cooperative project as well as the buyer’s personal financial situation.
Once a buyer has filtered through the different choices available with co-ops and condos as well as mortgage financing and has realized their ownership in an apartment, they have also attained the “homeowner” status, the same as a buyer of a private home. Now they can enjoy full ownership of their own space and decorate it, update it, or do nothing but enjoy it to their heart’s content.
Anessa Cohen lives in Cedarhurst and is a licensed real-estate broker (Anessa V Cohen Realty) and licensed N.Y.S. mortgage originator with over 20 years of experience offering full-service residential, commercial, and management real-estate services as well as mortgage services. She can be reached at 516-569-5007 or via her website, www.AVCrealty.com. Readers are encouraged to send questions or comments to anessa@AVCrealty.com. Read more of Anessa Cohen’s articles at 5TJT.com.
