(Closed) Is buying a condo worth it?

posted 2 years ago in Home
Post # 16
Member
704 posts
Busy bee
  • Wedding: June 2016

Hi, I live in CA so HCOL here. We really didn’t have a choice either rent or buy and rent is more than a mortgage here. A decent house here starts at $700k. We bought a 2 bedroom condo, 1295sq feet, in 2014 for $315k. They are now going for $400k+ so it worked out well for us. That being said I can’t wait to move, yes it’s nice having them do all the work for you but I can hear everything, right now they’re roofing and it’s been going on since October. Our neighbors are meh, the ones who smoke weed everyday are getting annoying though. This is just a starter home and we will be moving in about a year and a half. There’s more issues but it just pertains to this complex.

Post # 17
Member
499 posts
Helper bee
  • Wedding: August 2017 - Orange County, CA

emmabird :  I was raised with the idea that renting long term is not a good financial plan.  My Darling Husband and I also live in a HCOLA and houses in our city are $900,000+ 

We bought a 2 bed 2 bath condo about a year ago, our mortgage including HOA fees is about $2400/mo.  In the future we can sell or rent it out. Rather than that money just disappearing into a landlords pocket every month.

Post # 18
Member
5884 posts
Bee Keeper
  • Wedding: April 2013

emmabird :  When you say “is it worth it?” that can mean a few differnt things.  Is it worth it as a rental investment?  Maybe.  You’ve got the run the #s in you area to figure that out, it’s very different from city to city.

Is it worth it for you to live in?  Well, do you want to live in a condo?  If you love apparment style living, then maybe this would be a great choice for you.  If you don’t and you really just want to live in a single family home, I’d probably just save your money agressively and go for the house instead of a condo.

Here is a GREAT tool for helping to compare the full cost of ownership over different options vs renting.  https://www.nytimes.com/interactive/2014/upshot/buy-rent-calculator.html 

People have this preconcpeotn that renting is always a bad choice.  That is simply not true in all situations.  Be critcial and run the numbers to decide what makes the most sense in your personal situation.  

Darling Husband and I live in a HCOL (Bay Area, ugh!) and even though we can afford to buy it makes more sense for us financially to rent and invest our moneyelsewhere right now.  So we do that.  We like renting, so it’s not a big deal.

Post # 19
Member
1606 posts
Bumble bee
  • Wedding: August 2017

I was literally thinking about this topic as I woke up this morning! A studio condo in my city starts around $600k! We rent right now (and are in a great neighbourhood!) and a building just went up a few blocks down so we went to scope it out. $1.9 million for a 2 bedroom condo!!!!!!!

I’d imagine it is nice to own and know that you’ve made a good investment. And I like the idea of paying a mortgage every month rather than “throwing money away” by paying rent. But my goodness, I don’t know if Darling Husband and I will be able to make this a reality for a long time 🙁 So I understand where you’re coming from!

Post # 20
Member
552 posts
Busy bee

it can be a plus for taxes, depending on where you live. otherwise i would not put myself through the hassle.

Post # 21
Member
887 posts
Busy bee
  • Wedding: February 2019

I live in a big city where standalone homes are well out of my price range in the neighborhoods I’m interested in.  Moving into a home would require moving to a more up and coming area with a longer commute and less amenities, which I’m not interested in.  I’m probably not going to convince you as my reasons are as much emotional as they are rational.  For me, I don’t see it as an investment more I need to live somewhere no matter what so if I have to pay for housing I’d rather have the potential to earn some equity. But a lot of it for me is appreciating the sense of stability and consistency that comes with owning.  Having lived through the stress of a landlord getting foreclosed on and rent going up I appreciate that other than fluctuations in my HOA’s and taxes, my costs are pretty consistent and as long as I pay my bills I’m not getting kicked out of my home.  I really like the notion of sharing big costs for repairs upkeep among many people vs. being on the hook for it myself.  I think whether the HOA costs are worth it is a personal thing.  I used to live in a building with many amenities and a high HOA.  I didn’t use them enough to justify it so this time around I went for a smaller, lower maintenance building with fewer amenities.  The one thing to know is that sometimes with bigger buildings the HOA costs are artificially low to begin with and often go up as a board gets established and the #’s are right sized with costs.

Post # 22
Member
794 posts
Busy bee

emmabird : 

I relate to you and can tell you my experience, I live in a similarly priced city in Southern California and my Fiance (then BF) bought a condo a year and a half ago. It’s 2 BR and about 1000 sq ft and he paid $390k. It was the only 2BR place in our zip code that sold for less than $500k that year (and there hasn’t been one sold that low since), so he felt like was getting a pretty good deal. It has 2 bed, 2 bath, a kitchen and a shared dining room living rooom. It’s an older build with about 15 units, and about half are occupied by renters – it’s a young adult / young family type crew, and there’s a pool in the center of the complex we can all share. The biggest negative is we don’t have our own in-unit laundry, there’s a shared laundry room we have to pay for in quarters. Our maintenance fees are like $400 a month. He put over 20% down and got a decent mortage rate. When he bought the place him and I had been dating for about 9 months and he asked me to move in, I decided to, but if I hadn’t he would have gotten a roomie unti I was ready (with the caveat that he’d have to offer the second bedroom for a year to be fair to that renter and we could see where we were then). He could have paid the monthly mortage himself, but it would have been tight and he was hoping to have someone to help out in that case. We agreed on a “rent” of $1000 a month that I pay him that goes towards mortgage and HOA fee and it was less than I was paying to live by myself. I’m definitely paying “below market” and normally a room in a place like this would be $1500+. The mortgage and HOA and comes out to about $2.2k and we think we could get about $3k rent for the place.

We’re relocating for an educational opportunity, and we’ve decided to rent it out during our time elsewhere and we’re not sure if we plan to move back – we think we’ll make a small income each month depending on some details related to property management, but ultimately we’re counting on it appreciating. There are no guarantees, but we’re in a beach community in SoCal, and trends have shown that it doesn’t move with the job market the same way other major market cities work because people *always* want to live by the beach. We spoke to a pretty credible realtor, and she thinks that in 2-3 years we could be looking at $600-700k for our place. 

Was it worth it? I’d say yeah – it wasn’t a slam dunk or the best investment, but I think we’ll come out ahead. And the same realtor said that this experience could help financially with the mortgage when we hope to buy a home in a few years. My Fiance had been saving for awhile and wanted to make an investment, and was tired of paying rent and not getting anything out of it, but it’s not exactly windfall after windfall either.

Post # 23
Member
1253 posts
Bumble bee
  • Wedding: May 2018

In my opinion, no.

We did a few years of apartment living and would never want to buy a townhouse/condo for 3 main reasons.

1. We have dogs and having a large fenced yard for them beats leashing them up several times a day for a bathroom break. Especially first thing in the morning when we wake up.

2. We’re young people that host 2-12 friends over every weekend. It gets old to have to constantly tell our guests to lower their voices or watch their footsteps because of sharing walls with neighbors.

3. Not a fan of the rules that come with condos. My friend bought a townhouse and they are able to limit everyone to owning one pet! She has a dog and isn’t even allowed a goldfish!

Post # 24
Member
11592 posts
Sugar Beekeeper
  • Wedding: June 2015

emmabird :  ususally condos are a bad “investment” (but the notion that real estate should be an investment is another story sold by people who didn’t experience the market crash).

However, I bought a 2 bedroom in LA , in an area where a smaller square foot home with no upgrades since they were originally built went for $1.5 million. There were a lot of newer builds, but it was right by major studios so at a premium re location. 

I doubled my money when I sold. 

I would not bank on a condo appreciating, but if you’re in an area where location matters, you’re in a renewing area or there isn’t a lot of property/empty space, they can be a hot commodity. 

I loved the maintenance free lifestyle, although I needed a gardener because we did have little gardens,  it that was it as far as maintenance. 

 

Post # 25
Member
1011 posts
Bumble bee
  • Wedding: October 2015

My husband was right at the end of purchasing a condo when we met, he bought it at the bottom of the housing market and with a great interest rate so for him it was a win win. We lived in the home for about 3 years then sold it which allowed us to build our current home, if he had not purchased that condo then we would not have had enough equity to build. For us it was a great investment because the market turned around and the neighborhood ended up getting revitalized which made it into a hotspot of young professionals. 

 

If you look at the condo as an investment on your future then yes, it could very well be a good purchase but alot of it depends on the area and how the housing market goes. 

Post # 26
Member
1067 posts
Bumble bee
  • Wedding: June 2019

Pretty sure my brother regrets buying their condo because of their HOA. They were unaware of previous incidents of squirrels getting into the attic, and the HOA won’t pay for a new roof & sidings (where the squirrels are getting in) because they were replaced a few years ago. 

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