Condos in SF
Saw a few condos at SF priced < 500k for 1bd 1ba. As a person who doesnt know much about real estate. Here are a few dumb questions: 1. Why don't people buy these condos when they're priced so low? 2. Is condo a bad investment? 3. Is it always better to buy a SFH? They seem to be very very pricey.
I do see Condos in SF at 700k for 1bd 1ba, with HOA ~750/mo. This again seems too good. Still don't get it why they've been sitting on the market for months.
@OP Condos do not appreciate same as SFH HOA fees are just throwing away money For long term SFH will be easily sold then condo. My view points are purely in terms of investment.
Thanks for your response, Apple. I agree with you that HOA is throw away money. But, isn't it better to build equity through a condo and later on sell the condo to buy a SFH? The tax benefits when it comes to paying mortage for Condo in CA is beneficial too right?
Condos drop first in a down market. They are also the last to regain value on an upswing. Hoa fees can make them a lot more expensive. Example: 600/month is the same as spending another 100k on a house. Also, hoa fees go up over time. My condo has doubled their hoa in 10 years
Thanks, Ebay for the insights! A few questions: 1. You mentioned "my condo", do you own one? If yes, even with the above points, why did you go about buying one? 2. Based on your comments, it seems like a SFH is the best buy. And, both as an investment and a good financial plan - condos may not be as good as SFH? 3. If one buys a condo in SF, San Jose, Mountain View areas - do values of condos in these areas drop badly? I'd read somewhere that housing in these regions usually hold their value pretty well.
Yes I own one, and two sfh. So far they haven’t dropped badly. “Time heals all real estate wounds” I’ve been told. I think after the 1987 earth quake sf had a drop. They dropped probably 20-40% from the peak before the recession, but have doubled since the bottom. You should study it more, listen to bigger pockets and learn that way. I’m not a good resource but I can say the sf Bay Area is not a buyers market and not a good place for rentals right now if you want to buy one. You should look in other tech areas outside of California. They are more realistic in costs and have a better chance of turning a profit faster.
I own 8 condos. Mostly rentals but lived in one for a decade. High HOA fees (not 6k/month but high). Why do I love condos? You typically find these in the heart of a city close to where shit you want to do exist. It’s always easy to get them rented. What about HOA? Sure, it’s high but you’re collectively paying for amenities, maintenance etc. If your HOA is outsized compared to the cost and hassle you would pay for maintenance, then I get it. Otherwise, what’s the big deal? That said, preference for SFH may be regional. CA/WA folks sweat this much more than NY/FL folks.
1) priced low for a reason or artificial low list price to encourage a bidding war 2) Yes, limited upside, hit hardest during recessions, hoa, hoa, and hoa. 3) YES, land, no hoa, no rules etc there is a reason why this is the most expensive
It’s all about dollars-per-square-foot here. A “1 br 1 ba” unit that’s 400 sq ft is no bargain at $700K relative to a 2 br 1400 sq ft unit going for $1.5M. Besides, nothing here other than new-construction sells for the fictional “asking price”. It’s an all-out bidding war for anything actually worth buying. Units that languish in the online listings aren’t even worth a look.
They may be low/moderate income via the mayors office or they may be TIC or they may be tiny new units that haven’t been built yet and with astronomical HOA fees.
Are they low income units? (or some other kind of restriction)
I don't think I particularly saw such a note. But I just came across this in the description: HOA Fee: $4,586/mo So, this is additional fee to be paid other than the mortgage?
Yes, every month. That place is a rip off