Note, I could be wrong. These could be the worst places you're talking about. But it seems like there are at least a few around 800k, and the housing market moves fast [so you'll see lots of options if you look for a couple months].
20% down: $160,000
24 months mortgage in the bank: $68,000
24 months maintenance/property tax in the bank: $36,000
For a total of $264,000 not including closing costs. I don't have $264,000 lying around at this precise moment.
$600,000 is my real budget. $700,000 is for searching and getting an idea of "what if I wait another year and save up some more money".
All in all I'm not that excited. My apartment that I rent for $2500/month is way better than any of those places that turn up. And by "way better", I mean "still an embarrassment compared to the house I grew up in when I was a kid, that cost less than the down payment for a studio in Brooklyn". I don't even have a microwave.
Not to mention even if you have every lined up you can still get rejected by the co-op board and they don't have to give a reason. They go through all your personal details and it's a bit odd living with a bunch of people who know everything about you but you're not able to learn anything about them.
20% down is usually the bottom. A lot of places want 25% or 30% down and there's also a chance you're going against someone with 100% cash and the board will pick them nearly every time.
Lastly, if you're using every dime you have so you get a mortgage well over 500k that may be a bad choice. The opportunity cost of tying that much cash up into a mortgage is a lot of risk (all your net worth in 1 investment) and you're unable to use that cash to make other investments and leverage them if need be.
I don't look at real-estate as an investment, but rather as a sunk cost. I need somewhere to live, I want to screw around with walls and plumbing fixtures when I feel like it, owning seems like the right option.
Of course you don't actually own your co-op, you just own shares in a company that actually owns your property.
But to nit; I believe a coop is only 10% down (condos are 20%. Either way it doesn't really change your math). And I'm still years from being able to buy a place in NYC, so sigh
You will never find a co-op that lets you be a member at 10%. 20% is the minimum I've seen and usually you're looking at 25% or 30%. And there's a chance someone with all cash will simply be a better fit for them.
Please find me a Co-Op in NYC that lets you in with 10%.
http://streeteasy.com/for-sale/nyc/type:D1,P1%7Cprice:700000...
Note, I could be wrong. These could be the worst places you're talking about. But it seems like there are at least a few around 800k, and the housing market moves fast [so you'll see lots of options if you look for a couple months].