With rents skyrocketing across the US — and even more so in New York City — this once die-hard renter is faced with a reckoning about whether it finally makes more sense to buy.

Sure, there’s always been a premium to live in New York and other major cities, but rental costs have become not only outrageous, but also wildly unpredictable.

Rents in New York City have risen 19% in the last 12 months compared to a national average of 12.3%, according to a New York City economic report created by comptroller Brad Lander. The average rent in Manhattan in February 2021 (when I moved into my current apartment) was $2,804. As of August, the average rent in Manhattan was $3,998, based on Zillow rental index data. It’s not uncommon to hear about people’s landlords asking for $700 to $1,200 more per month at a lease renewal.

New York is hardly the only city where renters are suffering. The median monthly rent in Los Angeles has increased $505 compared with last year, while in San Francisco it's up $408, according to Zillow rental market trends data. Seattle has seen hikes of $218, and Atlanta's rents are up $193 a month. Even a smaller city like Lincoln, Nebraska, has seen a $138 jump in the median monthly rent.

Still, even with crazy rental prices, typically the only way buying more than a studio apartment in Manhattan will be cheaper on a monthly basis is if you can afford to pay all cash — the reason, of course, being the exorbitant price tags for property taxes and co-op or condo fees. There is more nuance in the outer boroughs, but those too are no longer filled with affordable homes to buy in desirable locations.

Co-ops dominate the Manhattan housing market. Those who buy into a co-op don’t own their specific unit but rather are shareholders in a building. As such, shareholders split costs for everything from maintenance, general upkeep, salaries for supers or doormen, and property taxes. Each co-op is a unique little microcosm, but co-op fees can run from a couple thousand per month to north of $10,000 per month. Again, that’s not inclusive of a mortgage.

You also must be approved by a co-op board and often need to submit to a highly invasive application process that includes providing all of your financial information to strangers for review. To top it all off, many co-ops have restrictions on using apartments as rental properties, meaning there isn’t the appeal of using it as an investment property in the future.

Don’t forget, in addition to typical closing costs and other fees that are part of the buying process elsewhere, New York state residents are subject to the mansion tax, which has to do with cost, not size. Real estate that costs more than $1 million is hit with a 1% tax, and New York City residents can get hit with a supplemental tax that raises incrementally for property that costs more than $2 million.

Let’s say a two-bedroom, two-bath apartment in Manhattan costs $1.425 million. The monthly maintenance fee (aka the co-op fee) is $2,200 and you’re required to put down at least 35% by the co-op board. With current mortgage rates, you’re likely looking at a monthly payment of nearly $5,900 plus the $2,200 monthly maintenance fee — which includes your taxes but not homeowners’ insurance or utilities, possibly. That means you’re paying at least $8,100 a month for your apartment.

A two-bedroom, two-bath rental in the same neighborhood would typically cost from $4,200 to $5,000. However, if you’re able to pay all cash — meaning you have a spare $1.425 million plus closing costs — then your monthly payment is cheaper than renting.

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