New York City is not just a beautiful tourist destination. It is also a city with a thriving economy and plenty of opportunities for those willing to fight for them. Of course, there are just as many chances that if you make significant investments in the city, it will all go wrong, and you will have spent your money for nothing! It is especially true when it comes to the city’s housing market. NYC is famous, or rather infamous, for its high property prices, making it crucial to know about the mistakes to avoid when investing in NYC property!
Rashly purchasing during peak season
Anyone who bothers to do some research into the New York City housing market will quickly realize how high the prices can get. After all, there’s a good reason why most New Yorkers choose to rent rather than own property. And, as anyone who tries to understand the purchasing and selling of property will tell you, this is only more pronounced during the peak housing market season. Many people tend to disregard this and wade into the mess anyway in their search for their perfect investment opportunity. However, most of them spend tons of money and end up without any real guarantees that they will be able to earn that money back! It’s much better to avoid this mistake and wait for the lull in the housing market. You can take the time to look at the properties and pick out the right one for your needs.
Thinking real-estate investments guarantee quick returns
Speaking of returns, one of the mistakeis blindly believing that you will be able to turn a profit quickly. There is absolutely nothing ‘quick’ about the New York housing market. In fact, sales often take longer and are much more difficult to pin down with a satisfactory result. This is precisely because properties are so expensive here. Anyone looking to purchase a good home for themselves has no choice but to be discerning and cautious. Planning to turn a quick profit through renting out your property is even more unlikely. Of course, rent prices in NYC are high. But it will still take a long time before they can cover the cost of a property purchase.
Not investigating the local market
Another of the mistakes to avoid when investing in NYC property is looking up ‘the most popular New York City areas’ and just buying a property there. Sure, areas popular with tourists and used as the beauty fronts of the city are excellent. And owning a place there can even be seen as a badge of honor. However, that’s about it. Most New Yorkers and people looking to live in the city long-term will likely avoid such busy areas. Even buying an investment property in Manhattan, if you choose this area, needs careful consideration when picking the right place. So, while doing research, try to approach it from a local’s point of view.
Underestimating the appeal of local amenities
Naturally, location within the city is only part of the consideration that needs to go into the process of purchasing the right investment property. And a mistake lots of investors make in NYC is not paying enough attention to the amenities found in the vicinity of the property. A discerning New York City resident looking to buy or rent will want to make the best use of their resources. Of course, you can argue this is the case in any city. Due to the steep prices of New York, however, this is doubly true. If you want to invest in New York City, you can’t provide your renters with a venue to complain about your property’s local conveniences. The experienced residents of the city may be able to negotiate down the rent you had been planning to charge if you do!
Trying to work on your own
It should be evident by now that navigating the world of New York City’s real estate market is not easy. For a second, though, let us forget about the previous consideration. There is a much more serious hurdle to overcome. One of the most severe mistakes to avoid when investing in NYC property is assuming that you will be able to function as an investor on your own here! With its odd housing market and ridiculous prices, New York has a very high threshold for anyone who wants to join the scene. Without the right connections, it will be impossible for you to even come across the best properties for sale. This is why, when confronted with the question ‘should you buy a house without a realtor in NYC?’ the answer is always no!
Not making a plan ahead of time
Of course, the biggest of all mistakes is still not giving enough thought to your investment plan. Are you planning to touch up the property and resell it for a higher price? Do you want to look for a serious fixer-upper or just a slightly rundown property? Are you planning to become a landlord? How many properties are you planning to maintain in that case? And what are the rent price ranges you want to focus on? Again, it is impossible to emphasize enough how expensive the housing market in New York is. Going into property investment casually without much of a plan in another city is not too big of a deal. Here, you face a chance of serious financial losses at every turn!
Now that you know about the mistakes to avoid when investing in NYC property, you should have a better chance of succeeding. However, keep in mind that there is still plenty to learn about the market. The complex situation caused by the epidemic has made this a rather tricky time to choose to invest. Still, if you are cautious and plan ahead, you will be able to turn your investments into a fortune!