With a 70k salary, should my daughter buy a condo or a house?

[Anonymous]

A 2br condo in a nice suburban area here is around $400k plus HOA fees. A smaller, older house in the same area is around $500k. With a 70k salary and $150k for down payment, which would you pick? The only negatives for the condo that we can think of are shared walls and less appreciation. She is thinking the condo would be best. We as parents are not so sure partly because we have never owned a condo before.

[Anonymous]

I own a suburban condo that has not appreciated in 20 years (purchased 2004). Only buy a suburban condo if you very much want to live in it. It is not a good investment.

[Anonymous]

Are you asking about which would be best for resell value?

[Anonymous]

Condos do not appreciate unless she is getting something that needs some serious renovations. However, if she wants to eventually keep it and rent it out, that is a different story.

[Anonymous]

A $400k condo plus HOA fees can often cost the same or more than a $500k house.

[Anonymous]

The house is a way better deal. The condo fees will be steep. An old house will likely require a lot of repairs monthly, but at least it's increasing house value.

Also, she should only buy a place if she can see herself living there for 5 years. In 5 years would it be possible that she's married with a baby?

I did buy the condo at 22. It doubled in price and I sold it at 28. It was a great investment. I needed to live close in and the old houses were just too old and poorly maintained (they were 1940s ramblers that everyone else was tearing down because they had so many issues and I couldn't afford to tear down).

[Anonymous]

House but she can’t afford it. Maybe if you give her $50k more.

[Anonymous]

The sfh is the better investment. Does she want to have a family someday? Usually a 2 bedroom condo gets crowded after kids and her condo probably will not have appreciated enough to trade up. Condo living is easier but HOA fees and special assessments can break a budget.

[Anonymous]

What is the condition of each? An older house may need some expensive maintenance - HVAC, roof, etc - will she have budget for that?

[Anonymous]

Neither. I would advise her to find a roommate situation and save more money to buy a house or townhouse.

[Anonymous]

Yeah I think both of those are way too expensive. I'd just continue to rent for now.

[Anonymous]

Anonymous wrote:Condos do not appreciate unless she is getting something that needs some serious renovations. However, if she wants to eventually keep it and rent it out, that is a different story.

Mine, in North Bethesda, has gone from $169,000 to $430,000 in just in about 23 years. So, I do not agree that they don’t appreciate.

[Anonymous]

I own a house on a single income of significantly more than $70k and houses are EXPENSIVE to maintain. My property taxes go up every year. I can’t even imagine doing that on a $70k salary.

To be honest, both of those mortgage scenarios are a stretch for her even with a high down payment. Does she plan to get a roommate? That is the only way I could see it working out even remotely well for her.

[Anonymous]

I'd pick based on which I actually wanted to live in - in this situation, probably the condo. Who wants to be a cash-strapped homeowner as a single 27 year old?

[Anonymous]

Anonymous wrote:I'd pick based on which I actually wanted to live in - in this situation, probably the condo. Who wants to be a cash-strapped homeowner as a single 27 year old?

Good point. She'll be spending her free time maintaining that house. Two bedrooms are manageable for a young single woman with a busy job.