Ask a…real estate appraiser

Is it better to rent or buy?

That’s a question everybody asks themselves. The best thing to do is look at your situation. If your family doesn’t plan on staying at the property for more than a year or two, it’s probably better to rent. If you’re planning on buying in New York and then selling it a year or two later, the purchase price isn’t going to go up enough to cover the closing costs associated with buying and selling a home. So, in the end, you may lose money.

How can potential buyers figure out if they can afford to buy?

The New York Times has one of the best tools around (nytimes.com/2007/04/10/business/2007_BUYRENT_GRAPHIC.html). You can enter in your monthly rent, the purchase price of a property, the mortgage rate and your property taxes and it will calculate your best option. The tool also shows you how long you’d have to hold onto your home in order to make buying the better option. Preferred Empire Mortgage Company (preferrredempiremtg.com) also offers a rent vs. buy calculator that can figure out which is more economical for you based on how much your rent is versus what your monthly expenses would be if you owned a home.

If you can afford to buy, should you?

It depends on your long-term goals, but for me, I think buying is better. The real estate market is cyclical. It goes up and down, but when you own, you’re building equity. When you rent, that money is going straight to the landlord. And nowadays there are so many options available to potential buyers. You no longer have to put 20% down. The focus is more on monthly payments rather than down payments. You should figure out what your family can afford right now, and also what you can afford if the mortgage rates go up half a percentage point down the road.

What’s one thing you should do before deciding whether to rent or buy?

Do your research. Know both the rental and sales market and the types of properties you’re interested in. Read Curbed.com for running commentary on NYC neighborhoods and development and make sure to check out The New York Times real estate section. You can also visit my blog (matrix.millersamuel.com) where I try to clear up any misconceptions about the housing market. Also, figure out what you qualify for before you start looking, either through an affordability calculator or a mortgage broker. Otherwise you’re wasting time looking at properties that you won’t be able to afford. (Go to millersamuel.com for free downloads of Jonathan’s market reports.) — Michelle Hainer

Miller Samuel, 21 W 38th St between Fifth and Sixth Aves (212-768-8100, millersamuel.com).

Ask a... real estate agent: Trisha Webster, of Brooklyn Properties in Park Slope, offers tips to first-time buyers.
Ask a... mortgage broker: Alan Trachtman, of Trachtman & Bach, explains the art of getting qualified.
Ask a... real estate attorney: Donald Fraser, a lawyer in Brooklyn Heights, offers words of wisdom on sealing the deal.