alex,
Your follow up question regarding development only matters to you in a BMR unit as it drives wages. The market rate units in the complex will want development to happen hoping it will drive the rate of appreciation higher. You will not be able to sell at market, you will sell at whatever percentage of average area income the condo is set for.
To decide which loan to get has tax ramifications and should be discussed with an accountant. Usually a person would look at how long are they staying in the property and how long will it take to see the benefit of the point paydown. If you pay $6,000 in the point and it reduces the payment by $100/month then it would be 5 years before you realized any savings. $1200/year reduction in payment divided into the $6,000 paid equals 5 years.
As I said before look at the what the sale process is, find out if there is a minimum time you have to stay there, compare the price you are getting the space with market rate units. Walk the area at different times of the day to see if you want to live there.

Fri May 16 2008, 10:23

I also have the same question. Should I buy this 2 bed BMR now? Is that area booming and is there anything cheering development that I can see in the near future?

Besides, the loan I am getting is 10% down , interest rate 6.5% with 0 point or 6.125% with 1 point.
Which one should I take or it's just a bad deal? Thanks.

Thu May 15 2008, 21:54

Alex,
When you purchase a BMR unit timing is not really relevant. Read the offer contract and see if you are locked in for a period of time and be sure you understand the exit formula. BMR's price is a percentage of the average income in the area. If incomes go up you can sell for a higher price, if incomes go down you will probably not sell unless you are moving into another BMR unit.
While you live there you can have the tax benefits of home ownership and actually every other benefit except the equity build up based on market fluctuations.
My thoughts on the complex are that the location is very central to all modes of transprotation. It is close to UCSF Mission Bay and all of downtown by Muni or bike and the areas surrounding it going towards Division and the Mart area has grown incredibly.
Be sure you understand what you are getting, especailly in the method you will have to sell and then talk to an accountant for advice on your tax situation. If everything checks out and it looks good then go for it. If you are borderline on a market unit and can get something that you can live in and let equity happen then do that but buy something. Quit renting that is a waste of money.

Sun May 11 2008, 20:16