# condos

Hi,

I have a question about condos.

I see condos advertised as costing X amount of money but I don’t know really what that translates to in terms of how much you have to pay per month when taking into account all of the factors.

Like, if a condo is 200,000, what will it end up costing someone per month when prinicipal, interest, property taxes, insurance, HOA fees, other costs, etc. are factored in.

THANKS!

First you have to learn how to calculate or at least estimate a mortgage payment. Do you know how to use a financial calculator? A \$200k 30yr loan at 6% will cost you \$1,199 per month in principal and interest. If you don’t have a calculator you can estimate the interest only payment which will get you pretty close; (\$200k x 6%)/12 = \$1,000. Next you have to figure what the annual real estate taxes will be, monthly HOA dues, and annual insurance expense for contents. Add it all up and you have your monthly cost of ownership; principal + interest + HOA + RE taxes + insurance.

and for condo there are usually a condo fee. (if not always) condo fee per sqr feet are different every building.

Is HOA fee not condo fee? I said HOA fee in my original post…am I missing something? is this a seperate fee?

I know you have to add it all together, the problem is that I don’t know what numerical values to add together.

could someone please give me an example of a condo building you know of where you know what the taxes, HOA fee, etc etc etc are and so you know exactly how much it would cost someone per month based upon what the price would be.

obviously this varies greatly due to property tax and HOA differences, but if anyone give an example of a place they lived in or are very familiar with that would be great.

thanks!

A 30 year loan at 6% interest costs \$6.00 per thousand per month. So, a \$200,000.00 loan would cost \$1,200.00 per month.

Home owners association fees (HOA) vary from complex to complex. The average where I live is about \$300.00 per month.

Taxes are another variable depending on where you live. Here it is .00125% of the sales price or, for a \$200,000.00 loan about \$250.00 a month.

Some condos include insurance in the HOA fees but if they don’t you should estimate about \$50.00 a month for insurance.

Mortgage = \$1,200.00
Taxes = \$250.00
HOA = \$300.00
Insurance = \$50.00

Total monthly payment = \$1,800.00

A Realtor or loan officer should be able to provide you with figures such as these. Ask the following:

1. What is the HOA fees
2. Is insurance included in the HOA fee
3. How are taxes computed in your area
4. What is the interest rate on the mortgage and what will the monthly payments (mortgage only) be.

Good luck

One thing to remember about condos are they get assessments when things need to be fixed and the board does not have money or a reserve fund set aside for that item. You have no control and it is done by voting. You must pay all assessments on time or they will foreclosure on your unit legally. There are people losing condos because of a \$500 assessment they do not want to pay or can not.

Upside to a condo as rental, no yard work to deal with. Exterior of building is not your job to upkeep. So less maintance. Also HOA will tend to increase annually in most associations to cover increases in cost and insurance.

If you buy a condo, find out about any longterm projects they are planning for, when roof was replaced or planning on replacing, landscaping, painting building, redo pool area or common area, etc. Many condo owners tend to vote against reserve fund for these items b/.c they can only be used forthe desinated item, such as a roof reserve fund can not be used to fix the pool area unless there is a vote to change the fund desintation and needs a large majority, I think over 80%. People do not want reserves when they feel why should I pay for a roof that will get replaced when I am probably not living here since many areas condos are now for young starting couples and singles waiting to start a family.

I’ve learned, after my first two condo investments, that the association dues really eat into cash flow. True, you never have to worry about exterior repairs (if you belong to a good condo association), but still…

I’ve seen condo fees range from \$100/mo to \$700/mo. Definitely know what they are before you buy. The higher numbers I saw had head and hot water included in the price.

thanks for the replies.

When a condo building is being built, they have introductory prices…“pre-construction” prices.

Do people usually pay the full price for condos or are they usually able to bargain for a much cheaper price if they are pre-qualified for the loan and will be using it for their residence?