I recently had a good friend ask if it was OK to “pick my brain” about buying an apartment in NYC. He was concerned that he was wasting my time, and didn’t want to take too much of my morning. I told him, regardless of whether you purchase in two months or two years, reaching out to me was precisely the right first step on his journey to purchase a new home. Stories of evil co-op boards, the next great neighborhood and hidden fees often distract buyers from what is most important in the initial stages – preparation.
The truth is, purchasing a co-op or condo in NYC is akin to playing the biggest game of the year, in a physically and mentally exhausting sport, at a very high level. The competition is stiff and, no matter how good you are, the opposing players on the “field” are often stronger, faster and smarter than you are – or at least it appears that way. Now, in the sport of real estate, it typically isn’t your ability to bench 400 lbs., run a 100-meter dash or read a defense that determines your success (although, the negotiation phase often feels like it). In real estate, stronger, faster and smarter comes in the form of down payment and DTI (stronger), decision-making, flexibility on the pace of the transaction and closing terms (faster), and experience, risk calculation and ability to research the market, seller, etc. (smarter).
For the average buyer in a market with low inventory, high cash bidders, multiple offers, foreign investors, winning in the game of real estate feels impossible. It conjures up famous unlikely victories like the Miracle on Ice, Buster Douglas vs. Mike Tyson, or a Jets win on Sunday. Whether winning means purchasing a home you love, exiting the rental maze in search of something more secure and long-term, or just increasing your portfolio with a sound investment, it seems impossible to emerge victorious – let alone worth the physical, mental and emotional toll to even get in the game. So, how does the underdog win?! The answer isn’t easy, but it is simple – Preparation.
Legendary Notre Dame Coach, Lou Holtz (as a Minnesotan, it is my duty to say he is known to us as the Legendary Minnesota Gophers Coach), famously said, “Preparation is everything.” As a 145 lb. high school football player, I needed to believe that. And, as a coach to buyers hoping to someday own a co-op or condo, I still believe that today.
“Success is where preparation and opportunity meet.” –Bobby Unser
The reality is that some buyers I speak to are not ready to buy an apartment today – and that is absolutely OK. I welcome that conversation and applaud them for their desire to learn and prepare. They are conditioning, practicing, studying and strategizing in order to give themselves the best possible chance to beat the competition when opportunity arises. They are the buyers who WILL be ready to win when the time is right.
Don’t let this crazy market dissuade you from pursuing your goal, but don’t assume you know what it takes to win. Prepare. Speak to someone you trust who doesn’t see you as a dollar sign – rather a relationship. The truth may surprise you, may disappoint you (albeit temporarily!), may encourage you or motivate you. Either way, it is the truth that you need.
To be continued…
My name is Eirik Davey-Gislason and I work in real estate in New York City. This blog is an opportunity for me to educate everyone who has a horror story or is on the verge of one. By sharing, preparing and advising my audience on what to expect, what is normal, what is right, and what is wrong, I hope to do my part to expose the wrong-doers and shape the future of this dysfunctional thing we call NYC Real Estate.