
Rent vs. Buy Visualization of Top 50 Cities - anon22
http://trulia.movity.com/rentvsbuy/
======
Daisy
Hi everyone,

Thanks for your feedback & questions. Just wanted to chime in and hopefully
clarify the methodology that goes into Trulia's Rent vs. Buy Index. To make an
apples-to-apples comparison, we only looked at the median list price and
annualized median rent for two bedroom apartments, condos and townhouses in
the 50 largest U.S. cities based on population. As such, this index does not
look at single family homes.

To calculate the actual ratio, we divide the median list price by the
annualized median rent. Here's a sample Price-to-Rent Ratio Calculation:
\---Median List Price: $140,201.37 \---Median Rent: $1,871.65 \---Price-to-
rent ratio: $140,201.37 ÷ ($1,871.65 x 12) = 6

To interpret this ratio: \----Price-to-Rent Ratio of 1-15: It is much less
expensive to own than to rent a home in this city. \----Price-to-Rent Ratio of
16-20: It is more expensive to own a home in this city. The total costs of
ownership of a home in this city are greater than the costs of renting, but it
might still make financial sense depending on the situation. \----Price-to-
Rent Ratio of 21+: The total costs of owning a home in this city are much
greater than the costs of renting.

By using 15 as our baseline for the interpretation key as opposed to 12 (which
would only account for a year's worth of rent), we are able to account for the
additional costs such as property tax and homeowners insurance.

Of course, we understand that the decision to buy or to rent is a deeply
personal decision based on ones unique financial situation. The Rent vs. Buy
Index was designed to be a guide to help folks gauge whether it's more
affordable to buy or to rent a home in one of the 50 largest cities.

Feel free to contact us with any additional questions. We love the lively
conversation and appreciate everyone's comments.

Cheers! Daisy Kong PR Manager, Trulia pr@trulia.com

~~~
showerst
This is a great infographic idea, but the census 'incorporated city'
boundaries/populations is not that good of a data set for this use case.

Metropolitan statistical areas would've been a more reasonable choice here,
since in many cities the city proper (as defined by incorporated bounds) is
either vastly under or vastly over-priced compared to where people actually
live, not to mention throwing off the relative populations.

As an aside, the way my map renders, Baltimore is north of New York =P. Great
job though, and kudos to your developers for not using flash =)

~~~
zach
The difference between metropolitan statistical areas and cities is
particularly noticeable with respect to Miami.

The city itself is only the 42nd largest in the country (population 450K) but
the MSA (which includes Fort Lauderdale and many suburbs) is the country's
7th-largest (population 5M+).

~~~
scott_s
Similar situation for DC. The city proper has 600K, but the DC metro area (the
parts of VA and MD near DC) has about 5.4M.

------
leelin
Very very cool!

I'm wondering why they chose 15 / 20 as the cutoff ratios though. I'm a
licensed real estate agent in NYC and I've helped a number of clients make
purchases where it was actually cheaper to buy than rent (usually a studio or
1BR, or outside Manhattan).

It seems like you can finance a home purchase these days at 5% or less on
30-year fixed. Add in the mortgage interest tax deduction and you are really
borrowing at 3.00% (assuming your marginal tax is 40% including state / local
taxes, which would be true of anyone buying a $1.3M 2br as referenced in the
site).

That seems to justify a break-even ratio of about 33, not 16 or 20. Of course,
you do have to add back HOA dues / coop maintenance + property taxes, and the
nasty transaction costs for buying and selling. That is somewhat tempered by
your rent (and property values) going up with inflation while your mortgage
payments are fixed. Therefore, all the usual disclaimers apply that you need
to be willing to stay there and own the property for quite some time.

EDIT: clarified that 5% rates are for 30 year fixed mortgages; 15-year
amortizations would get 4.25% or so, changing by the day.

EDIT2: The tax deduction is LESS good in other metro areas. When I used to
live in Redmond, WA, my marginal rate was not 40% (there is no state income
tax in WA and houses are much cheaper). Also far more subtle but often
ignored, in Washington most renters would take a standard deduction and only
home-owners would itemize their deductions. Itemizing mortgage interest means
you lose out on the standard deduction. In NYC, just about everyone itemizes
because state / local income tax is already compelling enough to do so,
therefore almost all the mortgage interest is deductible except for the amount
subject to Pease provisions.

~~~
tomsaffell
I agree. I just ran the numbers for SF. Based on mid-point of Trulia's buying
and renting price ranges ($750K to buy, $3.25K monthly rent), I get the
following annual real costs:

    
    
      buying:  ~$24K
      renting: ~$36K
    

That is based on the following assumptions: 40% margin tax rate, principal
repayment is not a real cost (it's a saving account...) 15% down payment
(renters invest the equivalent amount in a 3% annual return fund), 30 year
ammortization of loan with a 4% rate (available now on 5 year ARMs -- you can
always go back to renting in 5 years, and if rates soar then that means the
economy has recovered, which means your house is worth more..), property tax
of 1.16%, closing costs of $10K (that's high), spread over 5 years, home-owner
insurance of $600 per year (that's what I pay), no insurance for renters

EDIT:

    
    
      less risky buying option : ~$30K 
    

(now assuming a 5% loan (30-yr fixed), and PMI insurance of 0.5% of loan
value, per year - require for less than 20% down)

There are many good replies to this thread, that essentially point out that
buying a house is risky, and that my assumptions do not deal with any 'bad
case' scenarios. But nor do my assumptions deal with any 'good case' scenarios
(house prices being higher in 5 years time in _San Francisco_ \- it might just
happen..) But the topic of the original article is about costs, not risk, so I
kept the topic at parity, and only dealt with costs. If I were advising anyone
for real on rent-vs-buy I would strongly encourage them to consider the risk
and reward element of the rent-vs-buy decision, in the context the general
financial situation.

Summary: buying is riskier than renting, and it can also be substantially
cheaper. Right now, with a 30-yr fixed mortgage, it's cheaper. You have to
take on the 'house price risk', but that also carries a potential reward, as
this is San Francisco..

~~~
klochner

       > 30 year ammortization of loan with a 4% rate (available now on 5 year ARMs)
    

You realize that's how a ton of people lost their homes, right?

~~~
tomsaffell
That's only a part truth. My example specifically deals with _San Francisco_
(because Trulia showed it to be a 'rent not buy' city). In SF there have not
been anything like the level of defaults seen elsewhere in the US. Elsewhere
in the US, rate adjustments on ARMs were just one part of the problem. The
other bigs ones behind the recent crisis were: over inflated house prices (in
SF, prices were only down ~15% on peak); people qualifying for loans that they
could not afford with-or-without rate changes (by lying about their income);
people being unable to re-mortgage now because they have now equity/down-
payment (tightening lending criteria as a result of previous over-loose
criteria)

Summary: what you say is a true statement about _part_ of the reason the _US_
housing economy blew-up. But it's not very relevant to my example about buying
a $750K house in SF with 15% down and a mortgage that you can actually afford
(the only type you can get today - i.e. $100K in income)

~~~
klochner
My point is that you're taking on significant risk with a cavalier attitude.
Let me try another:

    
    
      > if rates soar that means the economy has recovered and your house is worth more
    

You realize that LTCM went bankrupt betting on asset price correlations?

~~~
tomsaffell
Well, the intention was not to be _cavalier_ , but to try to ignore the risk
side of the equation as much as possible, because thats what Trulia did, so
the analysis could be comparable. Having read all the subsequent comments
regarding risk, I now see that what I should have said is _comparing renting
to buying on a _cost only_ basis, w/o considering the differences in risk, is
not a helpful analysis._

I still stand by the original assertion: buying in SF can be cheaper than
renting (see the revised numbers), and the risk and reward there entailed is
actually pretty small if: buying now (after a recent fall), getting a 30-yr
fixed rate, and sticking around for ~5+ years

~~~
scott_s
What does it mean to consider cost without considering risk, when the risk is
that the cost may become more than you can afford?

------
mryall
I was hoping to see how affordable it is to buy in different cities around the
world. Unfortunately, this data covers 50 cities in just one country.

It should really be the "Top 50 Cities in the US". The US-centric nature of
websites like this is even more irritating when they don't state it up front.

~~~
keiferski
_Trulia's Q1 2011 Rent vs. Buy Index provides guidance to help you make a
smart decision on whether it is better to rent or buy in each of America's 50
largest cities by population._

~~~
mryall
I meant on this site. People coming to it from a different direction might
have more context or be less geographically distributed.

------
mtigas
The choice of a red-green gradient is probably not wise, considering the
prominence of people with red-green colorblindness. ( Screenshot
<http://bit.ly/fcRHRk> vs filtered screenshot <http://bit.ly/frqlxP> — Note
the similarity of NYC and Jacksonville.)

Otherwise, I really dig the execution of the map.

EDIT: Cached the filtered screenshot so as to not hit the (relatively slow)
colorfilter.wickline.org server.

------
jacques_chester
I have come to the conclusion that buying to occupy is no longer a rational
decision.

Consider a grid. On one axis, housing purchases are cheap or expensive. On the
other axis, the local economy is vibrant or moribund.

Hence:

    
    
      * Cheap + Vibrant: Basically doesn't exist.
      * Cheap + Moribund: Bad place to buy, you're tied to a high-risk location.
      * Expensive + Vibrant: Purchase cost will eat up the advantage of the local economy.
      * Expensive + Moribund: Get out ASAP.
    

Why buy anywhere?

Similar logic applies to buying to rent. Why not diversify? Long term rates of
return on share indices are competitive with property and do not have mortgage
risk. They also don't have local property market risks. Vanguard will set you
up with an international share fund, hedged or unhedged, very cheaply and
easily.

~~~
kscaldef
> On one axis, housing purchases are cheap or expensive. On the other axis,
> the local economy is vibrant or moribund.

Neither of these things is binary.

~~~
jacques_chester
If it wasn't clear, I'm using "axis" in the sense of continuous values.

~~~
whatusername
So then look for Cheap + Improving.

~~~
jacques_chester
Not a bad idea, but it assumes that you can forecast local markets. And you're
still left with mortgage risk.

------
chanri
The statistics on this infographic are misleading. It does not cost 200,000 to
buy a house in San Diego or San Jose!

Maybe the average for downtown San Jose and San Diego are close to 200k, but
that is the poorest area of both cities and not what should be used to
compare. The green bubble on the point for San Diego should be much much
smaller in radius(like miniscule), otherwise you think the 200k number refers
to the entire city!

People should not be using this to make informed decisions (obviously).

~~~
showerst
I believe that they're basing this data on stats collected by the census, so
you have take the city as defined by the census bounds, which aren't
necessarily similar to common conceptions of what area is 'in' a city.

~~~
chanri
There are many cities in the county of San Diego. The city of San Diego (where
you are suggesting that the 200k number came from) is about 10-20% of the size
of the county of San Diego.

They should make the size of the bubble smaller to only cover the area of the
city like you are saying.

~~~
showerst
The issue isn't really the city scale then, it's the numbers for the avg house
price: [http://www.trulia.com/real_estate/San_Diego-
California/marke...](http://www.trulia.com/real_estate/San_Diego-
California/market-trends/)

[http://www.trulia.com/home_prices/California/San_Diego-
heat_...](http://www.trulia.com/home_prices/California/San_Diego-heat_map/)
breaks it down better, my domain knowledge of SD ends there, I couldn't tell
you whether they're showing an accurate pic of what constitutes most people's
idea of San Diego.

The circle is definitely scaled correctly though, the ratio of area of the
circle to population (1306300 people per 1809 pixels, or about 722 people per
pixel) is within the margin of error for my numbers for new york (about
662ppl/pixel), and LA (about 725ppl/pixel).

------
iwwr
The decision to buy is prone to two major risks:

1\. That the value of the property will fall.

2\. That you will be offered a better job in another town and it's too
expensive to move

~~~
yummyfajitas
A third risk (technically subsumed by 1): your local economy tanks, driving
down both your income _and_ the value of your house.

Buying a home to live in is a form of un-diversification.

~~~
louislouis
A fourth risk: Fed raises interest rates then your monthly mortgage payments
cost more than renting and hopefully not more than you can afford.

~~~
smiler
If interest rates go up and the person who you're renting off has a mortgage
on the place and his interest rates go up - your rent will go up.

~~~
yummyfajitas
Then you move out and rent from someone who isn't charging above-market rates.

"Mark to mortgage" == vacancy. If you want to successfully speculate on real
estate (as any homeowner does, landlord or occupant), you need to be willing
to take losses over long periods of time.

------
codex
This visualization assumes that a condo for sale is the same quality as an
apartment for rent. At least in Seattle, that is not true--there has been a
rash of (ill advised) condo construction in the area which has resulted in a
lot of really nice two bedroom condos for sale, with new construction and
spectacular views. Two bedroom apartments on the market are nowhere near as
nice--and, of course, nowhere near as expensive. That's not to say that the
condos aren't overpriced, just that the distribution of supply may not be
uniform in every city.

------
cletus
I'm from Australia but now live in NYC and I've been debating the question
about whether to buy or rent. It's amusing to me to see a big red circle on
this graphic for NYC. I can understand why.

NYC is a special case in many ways. For one thing, from a purely financial
perspective, your best bet is to find a rent stabilized apartment that is well
under market value and then invest your money elsewhere, possibly on buying a
property you don't live in in NYC!

In Australia, buying property is a big thing. I'd imagine that in OECD
rankings for home ownership, Australia ranks reasonably highly. Interestingly,
the Guardian (in the UK) years ago did a study that showed that economic
growth in Europe was inversely proportional to the rates of home ownership
(meaning the countries with the highest rates of home ownership--eg Spain--had
the worst performing economies and vice versa).

This makes a certain amount of sense: home ownership creates a less flexible
labour market.

Anyway, in Australia, it's common to not only buy the property you live in but
also investment properties. Investment properties are tax advantageous (in
that the mortgage interest is a tax deduction) but you pay capital gains tax
when you sell (but a good investment strategy will have you never selling; you
just free up the equity to buy something else). The home you own is the
reverse: mortgage interest is _not_ tax deductible but your principal place of
residence is capital gains tax free when you sell.

Now the thing about real estate is that it's a hedge against inflation. For
example, 10 years ago you could buy a 3 bedroom house (built in the 70s) 10
miles from the city centre in Perth for <$100k. 5 years later? $350k
_minimum_. There was a structural change in the economy that hasn't since
reversed and doesn't look like ever reversing. Part of this was the increase
in land cost but part of it is the increase in building cost (where once you
could build a house for $80k, now anything less than $150-200k is
unrealistic).

So if you'd rented in that time you would've missed out on that huge jump.
Thing about real estate growth is that it is never smooth. It'll go through
periods of high growth and others of stagnant prices if not negative price
growth. So it's a long term investment (typically 7+ years).

But the real estate market in Australia is highly speculative.

I say that because I've also lived in Switzerland, which has an almost planned
economy. The tax system stamps out property speculation, arguing that it is in
the common good to have affordable housing. This is an opinion that I think
has merit. To give you an example, if you sell a property within 2 years of
buying it, the capital gains tax is 100% (iirc), meaning the entire gain is
taxed.

Anyway, back to NYC. NYC has a lot going for it from a real estate
perspective. It's a center for jobs but also land is a finite resource here.
Manhattan isn't getting any bigger. Most industrial areas have already been
converted to residential (or, more accurately, mixed residential/commercial).
Manhattan is mostly gentrified now.

Betting on a limited resource is typically a good plan but the difference
between renting and buying is huge here. Like a 1BR that might cost $2000 to
rent will probably cost >$500K to buy and have significant ($300-600/month)
maintenance fees to boot.

I really don't understand what motivates investors for that kind of return. So
something will change in the future but will prices come down (or just
stagnate for years) or will rents go up? If it's the former, rent. If it's the
latter, buy.

So I'm really torn on whether I should position myself to buy in the future or
simply resign myself to renting. At this stage I'll probably rent just because
I may move around with my employer (Google) but I must admit: the prospect of
owning an apartment in Manhattan _is_ appealling.

~~~
rdouble
Veering off-topic, but how do people in Australia rent apartments? It seems
the answer is NOT "craigslist."

Also, from just walking around Melbourne and Hobart, it seems that Australian
cities are more ownership oriented than major American cities. I've seen maybe
2 "for rent" signs. Am I just not seeing the rentals?

~~~
cletus
In America it's common for one company or landlord to manage an entire
building. In Australia that's extremely rare. In NYC for example, you have co-
op buildings, which is a new concept to me. Australia really has no
equivalent. Pretty much all apartments in Australia are "condos" in American
nomenclature (it's not a word Australians use).

Real estate agents list properties for rent, typically in their windows, on
their website, in the newspaper and/or on one or both of the big property
websites (RealEstate.com.au and domain.com.au). That's one thing I like: when
looking for a rental you only really need to check those two sites.

It's unusual to put a "for rent" (or "for lease") sign up. "For sale" sure.

You can rent something directly from the owner but it's reasonably unusual.
Even if the owner finds a tenant they'll typically use a real estate agent to
manage the property (do inspections, organize maintenance, take the rent and
so on).

So anyway, the lack of rental signs doesn't mean anything. In my experience
you only see them in front of larger buildings on the lower end of the
economic scale.

------
aik
I'm confused about the populations. For example, it mentions the population of
Kansas City is 143K. Wikipedia says 482,299, and "greater" KC is closer to a
million. What exactly is measured here?

~~~
41latitude
The population of Kansas City _is_ 143,000--Kansas City, _Kansas_ , that is.
(They're mistakenly using population data for Kansas City, _Kansas_ , instead
of the much larger Kansas City, _Missouri_.)

------
scblock
This data seems extremely unreliable. For example, it claims that in KC you
might be better renting, then lists a buying price range of $200-$300k. Then
hop over to Denver and it says buying might be better, with a price range of
$100-$200k. I've lived in both cities and looked at houses in each, and it is
much, much more expensive to purchase a house in Denver than in the Kansas
City metro.

------
grav1tas
What would be cool on top of this is if they figured in mortgage prices, the
average home upkeep costs for a certain area, insurance prices, and property
taxes (whew, it'd be hard) to determine if you're flat out better of renting
or buying in an area over an arbitrary period of time. This has always been
something I've wondered about, whether or not buying a home or renting an
apartment is actually cheaper based on a bunch of different factors. In the
US, there's always this big push for home ownership, but sometimes I question
the wisdom (financially) of buying a home for 'equity building' or whatever
else. That's not to say that owning your own home can't be totally fun and a
great place to raise a family or whatever else..obviously that's pretty hard
to weigh objectively, but still. I think this would be an interesting
direction for this site to go.

------
ck2
I see it as a visualization of where "old money" has gobbled up the
realestate.

------
keiferski
Cleveland is included, but not Pittsburgh? Someone's a Jets fan...

On a technical note, the information in the hover bubble is mis-aligned; the
right side is a space below the left side, at least on this older version of
Firefox.

~~~
showerst
They just pulled the top 50 cities from the census, Cleveland is 43,
Pittsburgh is 61.

[https://secure.wikimedia.org/wikipedia/en/wiki/List_of_Unite...](https://secure.wikimedia.org/wikipedia/en/wiki/List_of_United_States_cities_by_population)

(Cities vs metro areas, oh the perils of using census data.)

~~~
keiferski
Ah, I see. That makes sense, especially because the actual "city" of
Pittsburgh isn't all that populated.

------
cincinnatus
Use of City boundaries instead of MSA makes this inaccurate and not terribly
useful as a tool for understanding anything about these markets, let alone
making decisions from.

------
ianferrel
The concentration of high-population areas in California does some strange
things to the map when the city circles are sized by population.

The positions don't even seem to be constant. If you sort by something else,
the circle move around, but they don't necessarily move back to the same
place.

I have nothing interesting to add about the content of this site; I was too
befuddled by its presentation.

~~~
jpwagner
It looks like it does not attempt to preserve geographic location exactly.

It seems to load them in alphabetical order and fits the next one as best it
can given the already plotted bubbles.

~~~
shashashasha
(I made this)

Sorry if this is confusing! This visualization is a Dorling Cartogram, which
sacrifices geographic location accuracy in order to not have overlapping
points (the East Coast would be a tight unreadable bundle otherwise, as well
as the Bay Area). The basemap is intentionally left as just an outline to
provide some visual context.

A great example of this in action is the Olympic Medal count visualization by
the NYTimes:
[http://www.nytimes.com/interactive/2008/08/04/sports/olympic...](http://www.nytimes.com/interactive/2008/08/04/sports/olympics/20080804_MEDALCOUNT_MAP.html)

~~~
ianferrel
Thanks for the info.

I understand and accept that the location is not accurate to the map, but what
was so confusing was that the locations didn't seem to be accurate even with
respect to other locations, and that the location wasn't deterministic. That
doesn't happen on the nytimes example.

If I toggle back and forth between sorting by population and sorting by Rent
Price, the bubbles bounce around and end up in... some random arrangement.
Sometimes it's reasonable, and sometimes it's bizarre.

Here's a particularly egregious example <http://i.imgur.com/ZPAno.png>

Los Angeles is SouthEast of San Diego, Oakland is West of San Francisco and
San Jose is Northwest of both of them. It's hard for me to avoid being pulled
out by that.

~~~
shashashasha
That's definitely the map's weakness. We are using a force-based model which
is nice in that it is dynamic (if lazy), but does not have the same
consistency as the NYTimes example. For the NYTimes I understand they baked
and tweaked the layouts in advance in order to play it as an animation as well
as keep the layouts in the same position, which we should probably do on
future vaguely geographic explorations like this :)

------
hugh3
A note on the chart: it's very pretty, but _why_? As soon as you load it up
you see cities floating around the map in a way that cities really don't. And
once they stop floating around, the cities aren't quite in the right
geographical locations; to find the unlabelled dot that's Oakland I had to
first click on an unlabelled dot that happens to be Sacramento.

------
cryptoz
"...of Top 50 [American] Cities"

It's odd seeing lists like this that focus only on a specific country,
ignoring important neighbors. Take Toronto, for example. That city is more
important than 40-45 of the cities listed, but since it's a few miles North of
some border, it gets completely ignored.

Why not focus on a geographic region instead?

~~~
gyardley
The border likely affects the availability and format of the data needed to
make the calculation.

~~~
cryptoz
That makes sense. It would still be nice for the title to reflect that,
though, rather than the ambiguous and misleading "Top 50 Cities" that it is
right now.

------
callmeed
I was talking to a real estate broker from phoenix on my flight last weekend.
He said you can buy distressed homes for < $100k and condos/townhomes for <
$50k. He's got clients buying properties, renting them in less than a month,
and having instant positive cash flow.

~~~
tocomment
Any tips on where to find them? When I look through the mls I see very few
forclosures.

~~~
brc
I don't have any tips but you're very unlikely to find any good deals on the
internet. I would identify a target area and devote 3-5 days just hitting the
ground and running the numbers on places. You should know the numbers already
so when you see a place you know whether it is pass/fail on inspection.

It's a universal rule of Real Estate that good deals never reach the paper,
the internet or even the front window of the agency office. In fact they
rarely make it past the first page of the agent's buyers contact sheet. Find
an agent in the area you want to buy in, make it clear to them you are serious
and give a definitive description of what you want to buy. Make it easy for
them to do their job. Every agent wants to sell a place on the way back from
getting a seller to sign up. Your number must be on the list of people to
call. But don't give them a loose description or they will try and sell you
the first piece of crud they find. Be very clear on the description and list
out factors that will disqualify a property (main road, certain neighbourhood,
certain type of construction, etc).

Start making offers. Sooner or later you'll end up with a place.

------
ry0ohki
Interesting how DC and LA seem to have similar numbers and yet DC is
affordable to buy (because rents are slightly higher?) while LA is more
affordable to rent and a much larger bubble indicating some dramatic
difference that I don't see.

~~~
showerst
The circles are scaled by population, and according to the census city
boundaries they're measuring LA is 3.8MM compared to DC's 600K, which is a
pretty dramatic difference, although it's just an artifact of which data they
chose to use for population.

Personally I think they should've measured by metro areas, although unless
they have detailed lat/lon for every property they sell working out that data
might've been a mess.

------
monkeypizza
Ha. The ratio of buy/1 year rent is about 100 in Beijing.

This despite the fact that you are not legally allowed to own property in the
first place - and that the average lifespan of a building is 20 years.

------
bhavin
Did anybody notice the buying range for many cities was shown starting from 0
( e.g. 0-100k )... I wonder what that means?

------
joubert
I live in the city and am very curious why the foreclosure rate is shown as
0%.

~~~
martin
People who have equity in their homes don't typically foreclose, and owners in
NYC typically still do. Two reasons for that. First, property values in NYC
haven't dropped as much as in other areas. Second, co-ops constitute a very
large percentage of the purchasable housing in Manhattan (and in some of the
outer boroughs as well). Nearly all co-ops subject you to a very invasive
board approval process where you need to reveal everything there is to know
about your income and assets. They want to know that you're making more than
enough money to meet your expenses and that you have sufficient reserves to
cover yourself through any period of hardship. Co-ops also usually require a
sizable down payment (almost always at least 20%, sometimes even 100%). If you
seem risky, you don't get in. So there's definitely less of an opportunity for
shenanigans with exotic mortgage products and the like than in other cities.

