Home Buying in Fremont>Question Details

siaj_nad, Home Buyer in Fremont, CA

Buying a Condo vs SFL ?

Asked by siaj_nad, Fremont, CA Thu Mar 14, 2013

I am interested in SFL but based on market, looks like I might have to settle down with a condo. Would Condo as "stop gap" option makes sense. I can hold on to a condo for a while and then go with SFL as second house once funds are available ( Option A) or sell condo and use that to fund SFL ( Option B).
Atleast I will not be wasting money on rent/leases.

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Donald James’ answer
Dear First time,
One thing to remember is you are buying your first house and will move again in 6 years (on average for first time buyers). Buy what you can afford without stretching. You never want to be house poor. Your professional Realtor and / or mortgage expert can help you put together your house plan for the next ten years, a plan that had logical steps and should make / save money for you,
Web Reference: http://www.mywra.net
0 votes Thank Flag Link Mon Apr 1, 2013
The demand for homes is very high right now. Whether you are looking for a Single Family Home or a condo, the inventory for both is very low, therefore in this market since the prices are going up so fast, whatever you buy would make sense. If you wait too long, the price for even condos may be out of reach.

Many of my buyers are going to the new homes instead of resale. The demand there is also very high now, but I still think it is easier to buy a new home than a resale.

If you decide to go the new house route, make sure you take an agent with you so they can register you there. Take advantage of what your agent can provide you and register with an agent. The builder will pay your agent a commission so it costs you nothing.

I give my buyers a lot of inside scoop on how much the homes are going up in each phase, what the whole neighborhood resale homes are going for and if it makes sense to buy in that development. By getting an agent you have a lot to gain and nothing to lose.


Meena Gujral
Achievers Realty
925-425-9491
0 votes Thank Flag Link Mon Mar 18, 2013
Generally, single family homes are a better long term investment but out of reach financially for many first time home buyers. When making your comparison, however, make sure to take into consideration the overall cost of single family home versus condo / town home. Sometimes the HOA fees make the lower purchase price not nearly as attractive, nor as affordable as a single family home.

I would suggest you work closely with a realtor you trust, and continue to consider both single family homes and condos. You may also want to consider expanding where you are looking to purchase. Perhaps there are communities you are not familiar with, that are more affordable.

Good luck with your search, and congratulations on becoming a future homeowner!

Sally Blaze
Alain Pinel Realtors
DRE 01856137
sblaze@apr.com
925-998-1284
0 votes Thank Flag Link Mon Mar 18, 2013
If you can afford SF than go for SF so you don't have to worry about HOA or rental restriction.Your option also make sense if you are just beginning to invest in home.Most people start with townhome/condo and as time pass you build up equity and you can trade for SF later.Good Luck!!!
0 votes Thank Flag Link Thu Mar 14, 2013
Sounds like a plan.

If you need to get a loan, then you can take advantage of the historic low interest rates --- imagine 3.75% for a conventional loan! Still shaking my head at how low it is compared to what the interest rates were in the past 40 years.

Take a look at this blog by Steve Harney who says that interest rates are projected to rise up to 4.4% by end of the year.

http://www.kcmblog.com/2013/03/08/a-closer-look-at-mortgage-…

And about home ownership
http://www.kcmblog.com/2013/03/13/homeownership-the-reports-…

Some things you should look into if you decide to buy a condo. What type of loan are you getting? If you're getting an FHA loan, some complexes are not FHA-approved. If you want to rent it out later --- does the condo complex have rules about renting units? Is there a quota?

Good luck
0 votes Thank Flag Link Thu Mar 14, 2013
Hi there,

Your last sentence pretty much sums it up! "At least I will not be wasting money on rent/leases."

Basically, when you're paying rent, you're paying someone ELSE's mortgage. It would seem the best decision to invest in your OWN portfolio rather than elsewhere.

Like Brian says, sit down with a Realtor to discuss your plan, your financial goals and come up with a workable solution! :)
0 votes Thank Flag Link Thu Mar 14, 2013
Buying a home / condo is a great investment. To live in and then either sell or rent out.
It often makes more sense than renting.

You should sit down with a Realtor and discuss your future plans, price range, and goals and together come up with a plan.

Brian
0 votes Thank Flag Link Thu Mar 14, 2013
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