The Nest

NestApple's Real Estate Blog

Featuring real estate articles and information to help real estate buyers and sellers. The Nest features writings from Georges Benoliel and other real estate professionals. Georges is the Co-Founder of NestApple and has been working as an active real estate investor for over a decade.

8 Essential Tips for Buying a Home in NYC

Go Back To Previous Page

Depending on your price range, buyers face fierce competition. Competitors range from working professionals to foreign cash buyers happy to leave their​​ apartment vacant to park cash into the U.S. Competition for homes up to $2.5 million remains extreme in the city due to the large numbers of working professionals making $500,000+ a year. Those can afford to buy real estate in that price range. Ideally, buy when the market is soft.  However, everyone does not have the luxury of having unlimited cash and flexibility in timing. We will deconstruct every piece of advice you can find by people who have never bought an apartment. We will provide our best NestApple tips for Buying a Home in NYC. From buying a multifamily home in NYC to a foreclosed home in NYC, you will become a pro.

8 Essential Tips for Buying a Home in NYC

  1. Get Pre-approved
  2. Find a Great NYC Real Estate Buyer’s Agent
  3. Condo or Coop?
  4. Have an Attorney Ready
  5. Begin Your Search
  6. Don’t Reach out Directly to Listing Agents
  7. What Happens If I Reach out to a Listing Agent Directly?
  8. Who’s the Listing Agent for a Property?

family looking for a NYC home: Tips for Buying a Home in NYC

1) Get Pre-approved as the first of our Tips for Buying a Home in NYC

The typical piece of advice will suggest getting “pre-approved.” This way, you have a sense of what you can borrow and afford to purchase. The best brokers will not work with you unless you demonstrate you know what you want as a real buyer. If you need financing, you get “pre-approved” by your mortgage broker. Also, you have 25% down or more for a downpayment. A bank pre-approval letter remains much more reliable than a simple prequalification letter from a mortgage broker.

A pre-approval means the bank has partially underwritten your loan. The prequalification letter remains easier to secure, typically as quickly as after a 15-minute phone call.  No documents have been verified by the lender. As a result, if you need a mortgage, make sure you get pre-approved before you begin your search. Listing agents would take your inquiries and offers more seriously if you initiated the process.  And if you plan on working with a buyers’ agent, they will take you more seriously.

2) Find a Great NYC Real Estate Buyer’s Agent

The typical article will suggest you work with someone you trust, ask friends and family for a referral. The primary flaw of this advice remains that it does not present the possibility that they can get a buyer agent commission rebate. The Attorney General legalized rebates. However, it remains frustrating no news article, real estate newspapers, blogs mention the possibility of a commission rebate. Even though the services of buyers’ agents get pitched as free, buyers pay for it collectively in the form of higher sale prices.

Just because sellers have to pay the broker fee does not mean they don’t markup sale prices to account for this cost.  It makes sense then to ask for a commission rebate to account for the higher purchase price. We suggest first deciding whether the average $20,000 off your purchase price (in the form of a buyer agent rebate) means something to you. If it does not, and you just want to work with someone you know, then congratulations. You probably do not need to be spending time reading this article in the first place. If, however, you don’t consider 2% of your purchase price meaningless, you can use a broker giving you a cashback rebate like NestApple.

While unprofessionalism and listing broker discrimination sometimes exist, brokers must co-broke with a member of REBNY, such as NestApple.

3) Condo or Coop?

You should have an idea of whether you want to buy a condo, co-op, or townhouse in NYC. Generally, condominiums and townhouses remain more popular but priced higher as “real property” with all the traditional rights of real estate ownership.

new york real estateHowever, buying a coop remains a popular choice for many working families because they remain cheaper than comparable condos. Co-operative apartments contain just shares in a corporation that owns the entire building.  A co-operative owner receives a stock certificate and a proprietary lease with the right to occupy a specific unit in the building. Co-operative boards have much more power than condo boards as they represent the Board of Directors of the corporation. Since it’s required to have a real estate attorney represent you in New York, make sure to ask them any questions.

4) Have an Attorney Ready

One of the most common first-time homebuyer mistakes remains to submit an offer without having hired a real estate attorney. When they inevitably get an accepted offer, they end up having to scramble to enlist a real estate lawyer. This can result in several critical days of delays. Sometimes, the listing agents take this to mean that the buyer was only window shopping.

Real Estate Attorney: working on a real estate closing - Tips for Buying a Home in NYCReal estate offers: non-binding in New York

This will result in the listing agent continuing to show the property and shopping your offer to other buyers. Unlike many other states not requiring real estate lawyers for transactions, New York requires buyers and sellers to involve a lawyer in a real estate sale. Lawyers remain a critical part of your team when buying a home, along with your buyer’s agent and mortgage broker or bank.

A real estate attorney will review and negotiate the complex purchase contract and any riders on your behalf

Your lawyer will schedule an appointment at the managing agent’s office to review the board minutes. Your lawyer will conduct legal and financial due diligence on your behalf by reviewing the building’s financial statements, original offering plan, and other essential co-op documents. They also include house rules, sublet policy, proprietary lease, and bylaws.

The attorney of our choice will guide you through closing and make sure your mortgage commitment letter and other mortgage documents are in good order

Your lawyer will give you a good faith estimate of your closing costs, handle any escrows, and make sure the lender’s fees are correct. He will review the title report or coop lien search. Your lawyer will help you resolve any issues, such as existing liens on the property. Lastly, your lawyer will also prepare all of your closing documentation, calculate how much money remains owed by whom and make sure that all payments get processed at closing.

5) Begin Your Search: Tips for Buying a Home in NYC

First, clarify the advantages at this crucial stage of searching with an agent vs. searching by yourself. By working with a buyers’ agent, you have fresher listing data than consumers have access to. A buyer will typically use a website like Streeteasy or Zillow to search. However, these websites do not refresh their feeds continuously.

search online for an apartment - Tips for Buying a Home in NYCIn contrast, real estate agents must update their listings immediately or face stiff penalties.  An agent in NYC must update a listing’s status change within 24 hours.  Therefore, agents update their listing data directly to their local inter-broker database. This database refreshes almost instantaneously. The data they have becomes by default always fresh and most up to date.

6) Don’t Reach out Directly to Listing Agents

Among our tips for Buying a Home in NYC, this is one of the most important. Assuming you’ve decided to work with a buyer’s agent, you need to respect industry conventions for buying a home in NYC. Don’t make the “substantive first contact” directly with ​​the listing agent.

Doing so may give cause for the listing agent to refuse to work with your buyer’s agent. He looks at you as a direct buyer. We realize this can be tough sometimes. You want to buy, looking at homes yourself on the internet.  You want to have your questions answered immediately.  However, resist the urge to hit “Contact Agent” and instead send a list of your items and listings you want to see to your buyer’s agent.

Your buyer agent will reach out, schedule showings, sign you up for open houses, and get your questions answered. It may seem cumbersome. Still, the upside is you’ll have a loyal, dedicated agent who does have better data than you do. Your agent will schedule, negotiate, and be with you every step of the way.

7) What Happens If I Reach out to a Listing Agent Directly?

Most real estate agents who belong to REBNY behave professionally. They realize that it sometimes happens that a buyer agent’s client will reach out to a listing agent​​ directly. Most listing agents will not make a big deal out of it. They will not have an issue with buyers going to open houses and even private showings alone. This behavior makes the lives of buyers’ agents easier. Also, every listing agent will be a buyer’s agent for another client. Agents need to be able to work harmoniously with other agents to close a deal. They typically behave professionally so they can get the same lenient treatment in return.

There will always be examples of harmful real estate agents causing trouble for buyers’ agents who don’t show up. However, these point out to typically small-minded people who don’t do a lot of business. Moreover, REBNY does not require a buyer’s agent to accompany the buyer to a showing. Some new development “sponsor sales” may have a separate co-brokerage agreement specifying that the buyer’s agent must attend the showing. However, the industry does not often enforce that practice.

8) Who’s the Listing Agent for a Property?

It can be tricky to navigate all of the ads you see these days on popular real estate websites. Most of these search portals rely on advertising.  Real estate agents pay to get “accidentally” contacted on listings. In the quest for ever-rising revenue, these real estate search sites have made it even easier for buyers to accidentally click “contact agent.” Buyers get mislead into contacting a random agent who paid to advertise versus the listing agent. This will be a headache for you when buying a home as you will have yet another intermediary. The advertising agent may take a while to respond because they will have to find answers from the seller’s agent. If the seller’s agent does not know, he or she will have to ask the seller or the building’s managing agent.

Work with a seasoned buyer’s agent, such as NestApple, remains critical when buying a home in NYC. Your buyer’s broker will always be able to contact listing agents directly. Your agent can often find out more about the property before you can go due to access to broker databases with more detailed property information. Better still, by working exclusively with a NestApple buyer’s agent, you will have only one point of contact for your entire property search. This beats getting added to newsletters and regularly called and emailed by dozens of random advertising agents, listing agents, etc.

Perhaps you wish to save your buyer’s agent some time by finding out more information about properties directly from the listing agent. For example, you can use a disposable email address or an alias. This way, you can avoid harassment. You do not cause any conflict if you decide to make an offer on the property through your buyer’s agent.



Written By: Georges Benoliel

Georges has been working in Wall Street for the last 16 years trading derivatives with hedge funds. He has been an active real estate investor for over a decade. Georges graduated from HEC Business School in Paris and holds a master in Finance from ESADE Barcelona.

RSS Feed