I recently showed a condominium in Redwood Shores to a young couple that was considering single family homes under $490,000. They grew up in a middle-upper class neighborhood and wanted to own in the same type. Most homes under $490,000 in San Bruno, San Mateo, Redwood City, South San Francisco were run down and needed some work. My clients made several offers on short sales and were overbid on at least 5 REO offers. I was concerned with the necessary work since they did not have much money in reserve. I did not want them to start something and not be able to finish it like many of the homes we were looking at.
They were not looking forward to doing yard work so I convinced them to look at condominiums. They were hesitant because of HOA fees but I explained the costs of ownership over a period of time were basically the same as of single family homes or.
http://www.pruvoices.com/2008/10/hoa-dues-junk-fees-or-good-budgeting/
I showed them a 3 Bedroom 1300 sq. ft. condo and the young bride’s face just lit up when we walked in. It was modern, spacious, laundry inside, views and more. They were sold but they had to convince their parents who were putting up a good share of the down payment. The parents were difficult to convince. They were concerned with appreciation. I ran some numbers for the State of California from 1990 thru 2008 single family homes appreciated 79% and condos appreciated 116%. In San Bruno from 2000 –2008 single families increased 20% and condos 28%. Still did not convince the folks. San Mateo it was 7% for single family homes and 5% for condos.
When purchasing a home. appreciation should be taken into consideration but that should not be the only consideration. Life Style should also be given major thought.
I believe Condominiums offer a life style that fits many needs: No exterior maintenance, security with a security force or proximity to neighbors, often many have recreational facilities, and large complexes offer social activities, more updates than similar priced single family homes. Buildings that were built as condominiums and not converted offer excellent sound proofing and insulation. They also have laundry in the units. I suggest if buying a condo today to review the HOA financials closely. Many are having severe problems and assessments could be inevitable.
Oh, the young couple are hoping to close on a short sale soon.
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