Welcome back to my series “How Much Does It Cost to Own”!

Each month, we’ll be looking at different sized apartments to get a sense of what the “median” apartment in either Manhattan or Brooklyn would cost. This series should give you an idea of whether or not you’re in the “ballpark” for the kind of apartment you might want. 

Keep in mind that these figures represent the median for all building types. So coops, condos, walkups, elevators, doorman and non-doorman, amenities, low amenities, new development – they’re all looped in together. 

So let’s turn our attention this month to 2 bedrooms! 

Two bedrooms are essentially the “bread and butter” of the sales market in NYC and are the most in demand properties. But they also have some of the widest variations in pricing due to differences in bathroom counts and square footage. 

So for that reason, this edition has four rather than two infographics. But keep in mind that 2 bed/2 bath stats can be heavily skewed by luxury apartments and new developments. So don’t be too discouraged by the pricing for those! You can always contact me for more details on specific areas and property types. At the end of this blog post is a form where you can request a custom “Rent versus Buy” report. 

Let’s get into the numbers. 

Now let’s get a visual on how median price and total monthly costs have shifted over time.

What’s Behind the Numbers? 

The combination of higher interest rates plus higher asking prices pushed the cost of ownership up across the board except in one category – 2 bed/2 bath apartments in Manhattan. This category bucked the trend because asking prices were down by $60,000 compared to the prior period. Plus monthly carrying costs were up by less than $60. That combination was enough to offset the jump in interest rates. 

So what was behind the increase in asking prices? After a slow start to the spring season, sales started picking up a bit in May as the market adjusted to changing interest rates. So this could have pushed prices upward a bit due to increased buyer demand. Additionally, higher priced areas and apartment types saw increases in inventory. This changing composition of listings likely helped to push prices higher as well. 

Rent vs Buy

When it comes to the rent versus buy equation, buying beats out renting for 2 bed/1 bath apartments in Manhattan, since the median 2 bedroom rent in the borough as of the date of this post was $7,995. However, much of that inventory was located in more affordable neighborhoods uptown. So those in downtown areas might not see the same savings if you try to switch to owning. But keeping an extra $1500 per month in your pocket might be worth a move further north, especially if it means building equity! 

Meanwhile, for 2 bed/2 bath apartments, renting unquestioningly is the better option compared buying. Despite the meteoric rise in rents which hasn’t yet shown any signs of abating, higher interest rates are widening the gap between the cost of renting and owning. This reverses the trend we had been seeing in previous quarters of the gap closing between the two. 

We see a similar story playing out for 2 Bed/1 Bath apartments in Brooklyn as well. Owning beats out renting to the tune of almost $1,000 per month, since the current median rent for a 2 bed in the borough is $5,000. But again – you’re not going to find these kinds of savings across the borough. To realize them, you will likely need to move from a higher cost area to a lower cost area. Making the change in ownership in the same area isn’t likely to yield the same results except in a few places. 

And just like Manhattan, for 2 Bed/2 Bath apartments, renting easily beats out owning, with owning your own digs running nearly $2,000 per month more than renting. That second bathroom really comes at a big premium. But it’s also worth noting that there’s a high number of condos (especially luxury condos) currently on the market. And this may be skewing the boroughwide numbers a bit higher. That’s why it’s important to always get the specifics on the areas and property types you’re interested in. Market wide numbers are meant to just be guideposts to help you decide if you should investigate something further.

And if you’d like to investigate further now, you can request a custom “Rent versus Buy” report below!