Capital investment: residential and commercial buildings in Berlin

Real Estate, Investment and Economy in China

First of all, the most important question, how is the real estate market doing? The good news first: very good. Example: In Beijing, the capital, purchase prices (by house price index) increased by 47.2 points (+ 47.2%). A good real estate return. In comparison, in Germany the house price index rose by 32.3 points in the same period. China is making further leaps forward.

Just buy it? Of course you can’t. Who would have thought, only Chinese citizens are allowed to own real estate in China. And yes, only Chinese citizens are allowed to own real estate in China, as you will learn later in the section on business models and taxes.

As a small analysis, with a look back at the past years, we wanted to summarize the most important figures, around the economy, population, age structure and also real estate price development. Because… The USA has it as the largest national economy perhaps, soon replaced. With its million mega cities like Chongqing, Shanghai, Beijing, Guangzhou, Shenzhen, Wuhan and Tianjin. Here are the latest figures from the IMF:

If you want to invest money abroad, or even set up a company/branch locally and live here, you are looking for one thing above all else:

Plant Safety

Markets are subject to fluctuations, the more extreme these fluctuations are, the higher the risk to capital. Whereas 10 years ago the real estate market was still making great leaps upwards, but at the same time also downwards, the trends are increasingly stabilising, the extremes are becoming smaller. Accordingly, first a look at the Chinese real estate industry and the development of purchase prices.

House price in China: View of Beijing

House prices in Beijing, China – You are looking at the residential price index provided by the National Bureau of Statistics of China (NBSC). The NBSC data goes back to January 2011, and prices have been rising every year since 2015, for residential buildings, but also for land.

What does the house price index say?

House prices have risen steadily in recent years in almost all provinces. This is shown by the house price index available here from the NBSC, which, starting from the year 2015 (index = 100), stood at about 47.2 points in 2020. Thus, compared to the base year 2015, prices have increased by 47.2 percent.

Of course, the capital Beijing is the hotspot for foreign investors. As you can see right now compared to the country as a whole, with an increase of

This is attracting more and more interest from investors from Europe, USA, UAE and all over Asia to China.

Source: Global Property Guide

Land prices: Price index for China

This statistic comes from the Bank for International Settlements (Real Residential Property Prices for China [QCNR628BIS]). The basis here is 2016, which means that prices have increased by around 9.9 points since 2016.

Comparison: China / Germany: House price development

Now many will ask themselves, how is the development in Germany? Is it worth investing in real estate? Here you can see the development of house prices in Germany in the years from 2000 to 2019 (2015 = Index 100); as well as the previous statistics on housing in Beijing.

China 2015 / 2019 Development:

• 48.1 points (+)

Germany 2015 / 2019 Development:

• 28.1 points (+)

Property prices stabilise: 10-year analysis

Source: CEIC Data

Just like the Chinese economy, the real estate market is also stabilizing. The extremes of fluctuation are becoming smaller. So China, regardless of politics, is becoming an increasingly stable market, also for investors who want to invest money for the long term. The risks are declining.

China is building and building.

In summary – China’s real estate market in the last 5 years? The overall price index rose by 9.9 points, in mega cities like Beijing even by 47.2 points. With that, let’s take a look at the economy, gross domestic product and purchasing power in China. After that you will learn about the different types of companies in China.

Economy in China: GDP and purchasing power

Source: Socialmediaone.de(Marketing China)

Below is a quick look at China’s economy. More detailed analysis can be found in the source link. This infographic is interesting because 10 years ago everyone thought China would overtake the US in 2014. As we know today, a miscalculation. The US is still ahead of China!

Currently, the American economy is doing splendidly, especially after the US president cut many US taxes.

Tip: Save taxes with real estate (USA)

By 2025, the US, as an economy, will also remain ahead of China. According to the current IMF forecast, seen here, based on purchasing power-adjusted gross domestic product (GDP), in the years 2019 to 2021 (in billions of US dollars).

Source: Statista.

Growth forecast (IMF): 2025

View from the Oriental Pearl Tower in Shanghai.

Population: forecast until 2025

Not only is China one of the big players, the country continues to grow, as seen here, in total population from 1980 to 2018 and projections to 2025, with the population approaching one and a half billion by 2025.

• 2025 – 1,417 billion +0.9 %
• 2020 – 1,404 billion +2.18 %
• 2015 – 1,374 billion + 2.53 %
• 2010 – 1,340 billion + 5.76 %
• 2000 – 1,267 billion + 10.84%
• 1990 – 1,143 billion
• 1980 – 987.05 m
• …

More and more inhabitants are earning more and more money. Since 2006/2008, the gross domestic product has been rising almost inexorably. Since statistics are worth a thousand words, here is the gross domestic product (GDP) in current prices, from 1980 to 2019 and forecasts, again with forecast to 2025 (in billions of US dollars).

• 2025 – $23,029 billion + 54.97 %
• 2020 – $14,860 billion + 33.71%.
• 2015 – $11,113 billion + 84.20%
• 2010 – $ 6,033 billion + 163.44 %
• 2005 – $ 2,290 billion + 90.04 %
• 2000 – $1,205 billion
• 1990 – $396 billion
• 1980 – $303 billion
• …

Here you can see once again the real growth of the gross domestic product (GDP) from 1980 to 2019 and forecasts to 2025 (compared to the previous year) visualized.

What does that mean per person? If you divide the GDP among individuals, it shows that the purchasing power of individuals in China is increasing and increasing. Another indicator that makes China one of the current and future sales markets.

• 2025 – 16.284,03 $ + 50,22 %
• 2020 – 10.839,44 $ + 34,07 %
• 2015 – 8.084,80 $ + 79,67 %
• 2010 – 4.499,79 $ + 373,08 %
• 2000 – 951,15 $ + 174,21 %
• 1990 – 346,86 $
• 1980 – 307,00 $
• …

Who buys? Average age of the population from 1950 to 2020 and forecasts until 2050.

• 2050 – 47.6 years (+ 1.3 years)
• 2040 – 46.3 years (+ 3.7 years)
• 2030 – 42.6 years (+ 4.2 years)
• 2020 – 38.4 years (+ 3.2 years)
• 2010 – 35.2 years (+ 5.1 years)
• 2000 – 30.1 years
• …

Import or own production? China: Import of goods from 2009 to 2019 (in billions of US dollars).

• 2019 – $2,077.1 billion + 23.67%.
• 2015 – $1,679.57 billion + 20.29%.
• 2010 – $1,396.25 billion

Value of German exports to China from 2007 to 2019 (in billions of euros).

• 2019 – $95.98 billion (+$24.7 billion)
• 2015 – $71.28 billion (+$17.49 billion)
• 2010 – $53.79 billion (+23.89 billion)
• 2007 – $29.9 billion

Shanghai’s inner city, with its large international financial community, is one of the arrival points for entrepreneurs who want to gain a foothold in China. So let’s take a look at the different types of companies that are possible in China (for foreigners).

Tax: Rental income in China

Source: Global Property Guide.

First of all, only Chinese citizens are allowed to own real estate in China!

Generally, rental property is subject to Individual Income Tax (IIT), Business Tax (BT) and Real Estate Tax (RET). In addition to these 3 taxes, there may be some other taxes and surcharges on rental income that vary from city to city. Local governments in some provinces have a lot of freedom when it comes to taxation. Therefore, tax rates and the calculation of taxable income vary from city to city.

• Individual Income Tax (IIT)
• Business Tax (BT)
• Real Estate Tax (RET)

Income tax: Letting of apartments

Investment income, including rental income, is taxed at a flat withholding rate of 20% of gross income.

Trade tax

Non-residents who earn rental income are subject to a 3% business tax. Taxable income is calculated by deducting business tax, operating costs, administrative costs and finance costs from gross income.

Property tax

The municipal property tax applies to companies and individuals with foreign investors. Owners of real estate (but not land) are subject to this tax, which is levied at 1.2% of the assessed value. If the property is rented out by the owner, the tax rate payable on this is 12%. This tax rate is levied on the annual rental income. A special case applies to the rental of residential property, in which case the rate may also be reduced to 4%. However, practice may vary within China as the applicable tax rates are set by local authorities, according to Global Property Guide.

This tax is payable to local governments and is paid annually in installments.

Tax: Capital gains

Only Chinese citizens are allowed to own land in China.

Income tax

Profit from the sale of real estate, are taxed at a flat rate of 20%. Taxable income is the gross sales price less acquisition costs and related reasonable expenses. The maximum deduction for property development costs is 10% of the property cost.

Trade tax

The sale itself is also subject to trade tax. This is 5% of the net profit.

Properties that have been owner-occupied for five years prior to sale are exempt. In Beijing, the time limit is one year.

Land Growth Tax

The land increment tax is a transaction tax, on the transfer of rights to use state-owned land, in China. It is based on net profit and levied at progressive rates. The taxable profit is determined by deducting the cost of acquiring the land, development costs, repair and maintenance costs, relevant tax payments and other amounts considered deductible by the tax authorities from the proceeds of the property sale.

The tax rates start at 30%. However, they could be as high as 60%. This depends on the tax base, which is the valuation of the net profit combined with all the deductions.

“Real estate limited liability company” in China?

Since direct real estate ownership is not possible for foreigners, here is a look at possible business models that can be entered into together with Chinese partners. For tips on setting up a company in China, I would like to refer to an external site with much more in-depth information on setting up a company.

This question comes up relatively often with investors who want to expand to China. In Germany, many like to set up a real estate GmbH or a family foundation. In Europe, as well as in America, people are used to the fact that setting up a company for activities in the local market is relatively easy. In China, however, it is the case that every time a foreigner sets up a company, a Chinese partner must be involved.

You can find more information about the company models here (external).

List of companies:

• Representative Office
• Company with exclusively foreign participation (WFOE)
• Foreign trading companies (FICE)
• Joint venture – joint ventures
• Partnerships with foreign shareholders (Foreign Invested Partnerships)
• Branches

Alternative: Investing in shares

More and more are investing in China, of course on the stock market. Stocks like Tencent, Xi and also new ones like Niu (electric car) are gaining month by month. Accordingly, more and more are thinking about investment properties in China. From single stock, ETFs to currency trading.

Here’s a list of holdings that I find exciting:

Data: Global X ETFs

Tip. Real estate shares in Germany

Which companies are listed on the German stock exchange? Here is an insight into the top 30 real estate stocks in Germany:

• Real estate stocks: Germany

Dies ist Teil unseres größeren Leitfadens zum Wohnungskauf in den USA. Zurück zu Wohnungskauf USA. Wer L.A. als reines Investment sieht, sollte vorab unsere Grundlagen zur Immobilie als Kapitalanlage und zum Thema Eigennutzung vs Kapitalanlage lesen.

Die Stadt der Engel – Eine Wohnung kaufen in L.A.

Los Angeles, where dreams come true — and where real estate prices belong to the highest in the USA. Home to celebrities, Hollywood studios, beaches and surfing. From Malibu over Bel Air to Silver Lake and Venice Beach. It’s worth it to tolerate the traffic and chaos of the metropolis for the unique atmosphere of this city.

Would you like to live or invest in Los Angeles, but don’t know where to start? Mid-City, Silver Lake with the young students, or perhaps rather Beverly Hills? We give you a complete overview — including price ranges, return examples and tax peculiarities of California.

Los Angeles Economy – Overview

Los Angeles has a massive economy that ranks among the world’s largest metropolitan regions — alongside Tokyo and New York. Strength lies in the creative sector: Hollywood is the world’s largest film production area. But that’s only part of the picture. Add to that:

• Entertainment & Media: Hollywood, streaming studios, music industry
• Tech: “Silicon Beach” (Santa Monica, Venice, Playa Vista) — Snap, Google, Hulu
• Aerospace: SpaceX, Boeing, Northrop Grumman in the greater L.A. area
• Port & Logistics: Port of L.A. — the largest container port in North America
• Fashion & Design: L.A. Fashion District, the largest textile location in the USA

This diverse range of industries makes the market resilient against sector-specific crises — a key advantage over single-structured locations.

Los Angeles Drone – How beautiful it can be

Los Angeles has enormous visual fun to offer. Sunset at the sea, beaches, and skyscrapers:

Full L.A. Guide – Hot Neighbourhoods + More

Buy or rent? Break-Even calculation

Whether you buy or rent — in L.A. you pay a high price. The decision depends on the classic break-even point: How many years would you have to pay rent until you reach the same amount as a down payment plus mortgage repayment?

Break-Even Example L.A. (Condo, middle location)

Rule of thumb: When holding period is more than 5–7 years, buying instead of renting pays off. Under 5 years, closing costs, capital gains tax and real estate agent fees when reselling outweigh the appreciation. Those who want to calculate the exact Break-Even can use our Cashflow Calculator and the Purchase price factor.

• Buy when holding period > 5 years and rent comparison > $3,500
• Rent, if professionally mobile or market entry uncertain

Is it a good time to buy an apartment in Los Angeles?

The L.A. market shows cyclical phases. In high-interest phases, demand decreases, sellers become more negotiable — classic buyer window. In low-interest phases, prices rise sharply, bidding wars become standard. Those with sufficient equity benefit counter-cyclically: Calculate equity requirements.

Indicators for a good entry time:

• Days on Market (DOM) > 45 days = buyer’s market
• Price-to-Rent-Ratio > 20 = rather rent, < 18 = rather buy
• Inventory > 4 months = negotiation room
• Mortgage interest rates in 5-year comparison

Which state has the highest property taxes? The full list:

• Property Taxes by State – List

Los Angeles Real Estate Market – Explanation

The Los Angeles real estate market is doing well, like many US super cities. The market is neither clearly a seller’s nor a buyer’s market, but strongly micro-location dependent: Beverly Hills follows different cycles than East Hollywood.

Median Price Ranges by Property Type (Greater L.A. Area)

Mietrendite & Cap Rate L.A.

Die Bruttorendite berechnen ist in L.A. ernüchternd niedrig — der Markt lebt von Wertsteigerung, nicht von Cashflow:

• Brutto-Mietrendite: 3,5 – 5 % (Premium-Lagen oft < 3 %)
• Cap Rate (net): 2.5 – 4 % after HOA, Tax, Insurance
• Historical appreciation (10-year average): 5–8 % p.a.
• Purchase price factor: typically 22 – 32 (see Rental yield purchase price factor)

Those who want to compare the real performance can use our return comparison. For the German tax side of the investment, it’s worth looking at Real Estate return and calculate net return.

What you need to know about areas in L.A.

Los Angeles is a huge city spanning several counties. It is almost impossible to make a general decision. In general, there are three buyer profiles:

• Prestige buyers: Bel-Air, Beverly Hills, Holmby Hills, Pacific Palisades
• Urban lifestyle buyers: DTLA, West Hollywood, Hollywood Hills
• Hipster / Young Professionals: Silver Lake, Echo Park, Mid-City, Highland Park
• Beach Lifestyle: Venice, Santa Monica, Manhattan Beach, Malibu
• Families & Schools: Pasadena, San Marino, La Cañada

Rent Range by Neighborhood

• Lowest Rent: Jefferson Park starting at around $1,400
• Mid-range: Silver Lake, Echo Park around $2,500 – $3,500
• Premium: Santa Monica, West Hollywood around $4,000 – $7,000
• Highest Rent: North of Montana / Bel-Air starting at $8,000+

How to Buy an Apartment in L.A.

The apartment purchase is a long and tedious process with many stages. Whoever skips steps ends up paying for it in the end. If you’re generally unsure which type of property you should invest in, the comparison on our Buy an apartment main page and for first-time buyers the guide buy your first property can help.

Checklist – To complete before the purchase

How to specifically prepare for buying an apartment in L.A.:

• Check credit score: FICO > 720 for best conditions, > 760 for Jumbo Loans
• Debt-to-Income (DTI): max. 43 %, ideal < 36 %
• Demonstrate reserves: 6–12 months of payments as liquidity reserve
• Secure down payment: in L.A. at least 20 %, for Jumbo Loans 25–30 %
• Get pre-approved for a mortgage: contact a mortgage broker
• Build a team: Real Estate Agent, Real Estate Attorney, Home Inspector, possibly a Tax Advisor (CPA)
• For German buyers: apply for an ITIN, check if an LLC for asset protection is necessary

In L.A. with comparatively high prices, your down payment should be at least 20% — otherwise PMI (Private Mortgage Insurance) and a higher mortgage rate may apply. Those who want to understand the mechanics of repayment should look at amortizing loans and repayment mortgage.

Purchase of a property — process from negotiation to closing

Step 1: Make an Offer — Negotiate the Selling Price

You have found your dream apartment. Now it’s time to make an offer. There are two negotiation levers:

]]> https://lukinski.com/buy-apartment-new-york-everything-to-know-explained-easy-guide/ Tue, 01 Dec 2020 15:42:31 +0000 https://lukinski.de/?p=31909 New York USA – Buying an apartment in New York City is different than anywhere. We give you a full, easy to understand step-by-step guide to buying an apartment, penthouse or loft in New York, whether Brooklyn, the Bronx, Queens, or Manhattan. We cover everything from the New York City real estate market overviews to answering questions like buy or rent an apartment in New York? What are the tax rates for real estate in New York? What’s different about buying an apartment in New York? All this and more in our New York Apartment Guide.

This is part of our larger guide on buying apartments. Back to Buying an Apartment USA.

Living the Dream in NY – Buying an Apartment

New York, the city of dreams. You too can live your dream of owning real estate, many people dream of buying an apartment or buying a house in New York, one of the top cities worldwide in everything from fashion to finance to art and food. Buying an apartment in New York certainly isn’t the easiest of tasks, but one that is likely to leave you happy you took the risk.



The Money’s Flowing? New York Economy Overview

In regards to economic developments, New York is seeing a surge. So in a city where money is everyhwere anyways, it’s flowing even more now. Currently it is the city with the second highest economy in the world, ahead of Los Angeles. In recent years, multiple top companies from digital sectors have moved headquarters or opened offices in the city. This means increased investments in multiple sectors, along with higher demand for rentals in the inner city, housing workers. The general real estate market has weakened over recent times, meaning the classic investments of earlier years like TriBeCa or Soho where high square meter prices dominate, are currently clever investments for buying as the market is likely to recover, and these parts are likely to gain back value.

• Economy likely to grow

The Beauty of the City – New York Drone

New York City is known worldwide for its massive skyscrapers and epitome of big-city atmosphere. Take a view at the Metropolis from above:

Buy or Rent? Calculation Explained

When deciding whether to buy or rent, of course the low property taxes suggest you should buy. But as always, it depends where you want to live, and how long. If you’re looking at the downtown core, like Manhattan, it’s near-impossible to buy, and rent is comparatively cheap. So here, you would be good to rent, and invest your money elsewhere.

Neighborhoods like Bushwick, or even Chelsea, give you better buying options. Buying in Bushwick carries the same financial load as renting for three and a half years. That means buying here is much better than renting. You’re likely to leave a few years later with a strong return on your investment, along with financial equity.

• Depends on which neighborhood

Why it’s Good to Buy in New York City

In New York, it’s especially advantageous to buy, because New York property taxes are quite low. Thanks to fairly high income taxes, the state does not require to set high property taxes, which allow homeowners to save money. These taxes are at 0.86% in New York City, much lower than in the vast majority of U.S. States.

Low property tax rate in New York City means owning is worth it!



What state has the highest property tax rate? Ranking

• Property Tax Rates by State – List

New York’s Real Estate Market – Explanation

So what do you have to know about buying real estate in New York?

Properties are becoming increasingly large. Accordingly, there is an increase in purchases of properties valued at more than $1 mil. In New York, real estate is all about location though. On average throughout all of New York City, one-bedroom apartments can be had for $2.810/month, or two-bedroom apartments at $3.576/month. In e.g. East Brooklyn, the average rent is at $1.250/month, demonstrating the large chasm in where you pay and how much you pay. This is quite different from when you buy an apartment in Los Angeles, where no matter what part of the city you go to, you’re going to be paying hefty sums.

• Apartment Median price: $916.000
• Price per square meter: $7.244/m²

Important Facts – Property Investment in New York

There are a few things the experts swear by. If you want to invest in rental properties or generally non-owner-occupied real estate, these are the things you should keep in mind when thinking about investing in New York real estate:

• How long do you want to own the property?
• How do sales compare with the rent you will likely take in
• Find the right neighborhood
• Should you buy a Multi-Family or a single unit?
• Get your attorney to look over the building
• Buy the most bedrooms per most square footage
• Keep an eye out for tax abatements

How to Buy an Apartment

It’s of course a long and arduous process to buy an apartment, and takes a lot of time as well as financial investment. From beginning to end, there are irreplacable steps which, if you miss them, could be costly. If you’re not sure what real estate you should invest in, start here:

• Type of Real Estate – Which to Buy

Checklist – Things to do Before Buying

How to prepare for buying an apartment. Before buying real estate, you need to do these 5 things:

• Get knowledgeable about your finances
• Get together documents about your finances
• Speak to your possible mortgage broker
• Decide on the type of financing
• Find an attorney, real estate agent, and home inspector

Buying Apartment – Process from Negotiation to Close

To buy the apartment finally, you will want to start negotiating.

Make an Offer – How to Negotiate Sales Price

So you decide that this is your dream apartment. What now? Well now it’s time to make an offer. That means approaching the seller with an offer. There are two sides on which to negotiate, and you must pick one or the other. Either you try to reduce the size of the sale price. I.e. buying a property for $800.000 as opposed to $850.000. The other option is to negotiate the closing costs, e.g. agreeing on the sales price, but asking the seller to pay some of the additional costs, including real estate purchase taxes. These tactics of course mean either having more money in your bank account at that moment, or reducing the amount of montly costs in the future. You can typically expect to negotiate 5%-10% of the sale asking price.

Next Steps – Building Inspections

Your lender will most certainly require you to have an inspection of the apartment building, as well as the unit itself. This usually shows slight flaws, such as necessary maintenance in the future, or e.g. structural flaws.



Reducing Sales Price on Real Estate

Now you can renegotiate. You have found flaws in the building, and now have a strong negotiation stance. Let the seller know your concerns, and they will likely be more lenient in their negotiation.

There’s also a ton you can save on the many slight additional costs which come up when buying real estate, we give you the full guide

• All Additional Costs when Buying a Home

Final Important Step! Walk-through

Don’t forget the walk-through! This is one of the most frequent beginner mistakes. After moving out, things may change, the previous owner may have broken something, or a cabinet may have been covering up a flaw. Not doing a final walk-through can be your number one regret later on. It doesn’t take that long, and will most certainly be worth it, at least for the peace of mind.

What’s Different in New York?

There’s of course some caveats to buying an apartment in New York as opposed to elsewhere in the U.S. That means a few things to keep in the back of your mind when considering your purchase of an apartment. Of course, the normal process takes place, you buy a unit using a downpayment as part of your mortgage, pay closing costs, and then taxes, and then move in.

Property taxes vary from county to county, if you’re investing in New York,

• Property Taxes NY Explained

Before – Buying Apartment Preparation & Planning

The people which are required to be at your side are of course the same all over the U.S., but in New York there is one specific requirement. When buying an apartment in New York you are required to have an attorney on hand. That means you need to get one sorted (preferably with real estate specialization) before even starting your search.

• Mandatory to have an attorney



Taxes – Extra Real Estate Costs

Of course there’s different taxes in New York than elsewhere in the country. New York is one of the states which, along with the real estate transfer tax, requires a mortgage tax. Like for example the mansion tax, which kicks in when buying a property worth more than $1.000.000, or the flip tax, which is actually not much of a tax because it is private. The property taxes, how much they are and how they’re calculated is of course also unique in the Big Apple.

Pretty much everyone pays too much in taxes. It’s especially easy to save on real estate taxes. Learn how:

• Saving on Real Estate Taxes – Easy How-to

Insurance – Expensive Additional Cost

Not to forget is that you will have to pay homeowners insurance. In New york this can run around $2.000 a year.

• $2.000/year homeowner’s insurance

Sponsor Units – Affordable Apartments Trick

Sponsor units are only available in New York. They are a special types of apartments. These typically exist in multi-residential buildings which the developer or co-op have mostly rented out or sold. Yet, often these developers or cooperatives keep a few units to themselves for private use. These are often later turned into rentals or sold on. The advantage, in co-ops, the new resident will not be required to have to submit a financial package. Sponsor units are also usually cheaper to buy than other type of units.

• Cheaper
• Easier to get
• Rare



Rent Control? Stabilization? NYC Real Estate Law

Is it even worth it to buy an apartment? New York has rent-controlled and rent-stabilized apartments. These differ from the typical apartments in that they have much lower rent. But, because they are extremely rare and nearly impossible to find, it’s better to focus on rent stabilized apartments.

Rent Stabilizing – Meaning & Definition

Rent-stabilized apartments are apartments who’s rent cannot increase heavily. The yearly increase is regulated by the government. This protects you as a tenant. It also makes you lucky to live in such an apartment. Meaning that if you are at the moment living in a rent-stabilized apartment, you are likely to be paying less than many others. Therefore, buying an apartment is perhaps at the moment not the best idea.

• Rent stabilized = government-controlled rent increase

Where to Live in NYC – Best Neighborhoods

There’s the five boroughs, Bronx, Queens, Manhattan, Brooklyn and Staten Island. But within these, countless neighbourhoods, some world famous like Harlem, Upper West Side, Greenwich Village, Williamsburg, and the list goes on. So where should you move? Most everyone, we included will suggest you to get to know the city a bit first, research, and also just walk around the neighbourhoods and see which atmosphere fits you best.

Ultra-Luxury Penthouses & Lofts

Of course, some of the super-rich of the USA have ultra-luxury apartments in New York. Among them Superstars like Jay-Z & Beyonce and Justin Timberlake. One of the most impressive though has to be Jeff Bezos’ $80 million apartment in Manhattan.

Worst Neighbourhoods in NY – Danger, Crime, Low Standard of Living

The worst neighborhoods in New York are decided by how dangerous it is, how good they are to live in, and more. And if you think that you can make a clever deal by moving to one of these areas you are mistaken, as none of these neighborhoods are especially cheap.

• Woodlawn-Nordwood
• Hunts Point
• Brownsville
• Fordham
• Mott Haven
• Fordham
• Bedford Park
• Downtown

New York’s Hippest Neighborhoods – The Places to be in New York

There are a few neighborhoods you can’t miss. These are the classics like SoHo or TriBeCa. The top neighborhoods in New York City to invest are the famous ones of course. Think Greenwich Village or Williamsburg. The other famous ones, Astoria (Queens), Bushwick (Brooklyn), or Greenpoint (Brooklyn) are also safe bets, especially for younger or more culture-oriented movers. Some ones to keep an eye out for are Chelsea, where the nearby Hudson Yards project is driving down prices of top and up-and-coming real estate, or Bedford-Stuyvesant the prodigal son of hip New York neighborhoods, and lastly Park Slope, which will likely see a sharp increase in prices over the next years, meaning investment now is likely to pay off.

Classics: SoHo, TriBeCa, Greenwich Village, Midtwon

Hip: Astoria, Bushwick, Greenpoint

Future Stars: Chelsea, Bedford-Stuyvesant, Park Slope



You want more info. Where to buy an apartment in New York City? We tell you everything you need to know

• Best Neighborhoods to Buy – New York City

Best New York Neighbourhoods List

The best New York neighborhoods are difficult to pin down. Everyone has their own preferences, and their own needs. Making it impossible to say definitively what the best are. Below are what are considered some of the top New York neighborhoods.

1. TriBeCa
2. Gramercy
3. Battery Park City
4. Nolita
5. SoHo
6. Dumbo
7. Financial District
8. Murray Hill
9. NoHo
10. Kips Bay
11. Prospect Heights
12. Brooklyn Heights

Should I Rent a Co-op Apartment?

Co-ops are probably more famous and more popular in New York than anywhere else. Here, they make up almost half of all residences. Co-ops are slightly more challenging to get, with a complicated and time-consuming process, but the time investment is worth the reward, with typically lower property taxes, the possibility to build equity, and more.

What is a Co-op Apartment? Real Estate Corporation

A co-op apartment is an apartment which is administrated by a housing cooperative. If you buy a co-op apartment, you are not actually buying the property, i.e. the four walls which you intend to live in. Rather, you are buying a share in a legal entity. The shares you buy entitle you to use a specific part of the building. Therefore, you are not the owner of real property, but rather a membership which allows you to use the apartment you live in. This also means of course that you do not take out a mortgage, but rather share loans, i.e. a loan to pay for the shares.

• You buy shares, not property

Why you Should choose a Co-op – Explanation

Because you are not the owner of the property itself, you do not have to pay property taxes. Rather the cooperative pays the property taxes for the whole building, and these are divided among the members, i.e. residents. The main advantage of a co-op is that it is cheaper. The property taxes which each resident pays are lower, and any additional fees are also lower, because the co-op is not intended to make profit. Lastly, residents in co-ops, despite not actually owning the property, are entitled to many tax deductions which real estate owners are entitled to.

• Cheaper

How to buy a Co-op Apartment in New York – Step-by-Step

There are a few steps to go through before buying into the cooperative. Before approaching a co-op, or identifying an apartment which you are interested in, you have to gather an attorney, a mortgage broker, and an engineer. Although this is not necessary, it greatly increases your chances of getting the apartment you want. This is because, once you’ve identified the apartment you want, you apply. Your application is decided upon by the board. This board obviously wants the best possible residents, therefore it’s important to present yourself as a serious buyer. All co-ops have a certain list of requirements, which include the amount of downpayment you need to pay, and how much financial reserves you have. Following this, you contact the seller, begin the title search and mortgage application, and close the purchase.



Buying an Apartment NYC – Checklist

If you want to buy an apartment in New York, these are the most important things to do and keep in mind.

1. Decide! Rent or buy?
2. Prepare! Visit the city, research the market
3. Lawyer Up! Find your attorney
4. Choose affordable! Sponsor units, coops, or up-and-coming neighborhoods
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