Home value: 360K Home location: Chandler, AZ. New construction townhome. 3B2.5B 1561sqft Down payment: 3% HOA: 294$ Taxes: ~250$/month PMI: 215$ Expected monthly payment: 2200$/month TC: 104K Location: Tempe, AZ Current rent: 1700$/month Not planning to increase down payment. I am on h1b Spouse is expecting H4EAD and plans to work. Have a 6month old kid. I have been resisting the temptation to buy a new home from the past few years but ever since we had the baby a bigger home is the need of the hour. EDIT: I spoke with the builder, it’s a townhome and not a condo. Update: Thanks for all the suggestions. I retained the security deposit and tried to make few offers and failed. I’ll be closing the condo next month and the value has gone upto 420k now due to the crazy market. I changed my job and my TC is 170K #personalfinance #investments #homeadvisor
I have a condo - wife and 2 year old - and love it. Different strokes... Why are you paying PMI? Try your best to avoid that
I have a home loan in home country(india) @8.75% interest. I am planning to clear that off with the available liquidity.
Also agree with other folks - buying a home doesn’t seem like the right decision for you now
Don't buy a place unless you can afford putting down 20%. Condos are fine purchases, but be sure to look into the HOA finances.
If you can’t put 20% down, you can’t afford it.
Lol PMI sucks but if I have $80k down payment for a 400k house, and instead put down $12k (3%) I have $68k liquid. 3.75% interest on that $68k difference over 30 years is nothing compared to the 8% gains you can make in super safe investment of the $68k... even with PMI for the first 4 or 5 years you come out way ahead after 30 years.
Buy a starter home, not a condo. Condos are a waste of money. Plus kids need space to run around like a yard or garden. They go mad in small apartments. Please look into low hoa ideally below $100. Read all hoa papers before agreeing. Best case to avoid hoa all together as they are a pAin!! Royal pain. Also if going for a house, look for a nice community like cul de sac homes. Kids will have friends and you will have good neighbors. Good luck :)
Hi, I figured out that it’s a two storey townhome and not a condo. I’ll be sharing walls with two other townhomes and that’s it. I would own approximately 800sqft of land. Is the townhome still as bad as a condo ? The entire 1st floor is living room+kitchen. There would be 3 rooms in 2nd floor. Do you think it’s still small with a kid ?
I suggest that you rent a bigger place then buy after your spouse finds a job. The. You have more certainty about your spouse’s commute and household income.
That’s a lot of money relative to your tc. It’s possible but depends on the rest of your budget and spending.
I am still confused about putting the downpayment. If I do it then my monthly payment will be just 300$ more than my current rent. I am a very moderate spender and phoenix area is LCOL. I generally save 40-50% of my take home after all expenses and rent. If I bought this home I’ll probably save about 30% of my take-home. Do you think it’s still tough decision based on my TC ?
I mean yeah. Not sure what that all amounts to in actual numbers, but let me put it this way. If you end up with roughly 6k/mo take home and save 30%, that means you’re saving roughly 1800/mo and spending the rest. That means it would take you about a year of saving to replenish a 6 month emergency fund. You’re doing better than a lot of people, but costs come up, especially with a house. Don’t forget to set aside extra money for maintenance and repairs. You will easily eat into that 30% with home stuff, even when new.
Update: Thanks everyone for all the suggestions. I retained the security deposit and tried to make few offers and failed. Hence I’ll be closing the condo next month and the value has gone upto 420k now due to the crazy market. I changed my job and my new TC is 170K. I’ll probably repent for not buying a bigger home since I now have a better TC but I am happy I have a home during this crazy market.
Never buy a condo
Any reasons ?
You won’t have the same equity that you would if you bought a house. Condos tend to depreciate in value rather than appreciate. Unless it’s a condo in SF, Manhattan or Miami Beach, don’t expect to sell it for more than you bought it for.