# Does it make financial sense to buy a condo (Based on my personal finances)



## Edgar (Mar 24, 2014)

So, I have found a condo that is roughly in the same location as my current place (a few blocks away), but I am not sure which is the smarter choice between buying a condo or remaining at my current location (renting)

Currently living in a 2-bdrm apartment. My portion of the rent is 700 all-inclusive. Current salary after tax and benefits is $44,000. No debt. Monthly expenses vary between $1,700 to $2,000 (incl. rent). I am 24 and don't foresee a change in my city any time in the near future.

2-brdm Condo - ~$210,000 purchase price. Would require me to expend pretty much all of my savings (~$42,000) for a down-payment. Condo fees are ~$750/mth. They include most expenses (except internet) and include recreational areas. Property tax is 200/mth. I could rent a room for ~$850/mth.

Would this make sense as a purchase?

I am torn on depleting my savings, which would leave me without an emergency fund. It would cost me more per month than my current arrangement. Conversely, the condo is nicer than my current place (I currently live in a fairly old building) and would place me slightly closer to work.

Any thoughts or input would be appreciated. I also don't know how my my tax scenarios would change between these two options.

Thanks in advance.

EDIT: The consensus seems to be that I should stay away. Thanks all.


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## tygrus (Mar 13, 2012)

$850/month condo fees?? Are you serious?

There are people that dont pay that much in a mortgage. You are going to sink yourself good with that purchase.

Never ever buy something without land.

Why so willing to jump into a huge dept at 24 and limit your mobility and opportunities in the world by shackling yourself to a box in the sky.

Put your $42k in your tfsa and keep renting. At 45 you will be able to retire and move out of that nutso place.


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## Edgar (Mar 24, 2014)

My consideration with that condo fee was it's inclusion of hydro, heat, water, etc. Without essentially pre-covered utilities, it would be too high (agreed). I'm thinking that it is still a bad deal in your opinion.


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## Just a Guy (Mar 27, 2012)

You haven't calculated your mortgage payment (somewhere around $700/month), property taxes, insurance, closing costs, etc. All these are paid in after tax dollars.


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## Danny (Oct 17, 2012)

I would not buy a condo at this time. You are sitting pretty. If you don't mind staying where you are you can sure sock a lot of money away.


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## RentGera (Apr 28, 2016)

Seems like a no brainer as the condo fee's are way too high. I'd continue to rent until could afford to buy.


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## robcareal (Jan 9, 2017)

Use this superiorrealtypoint.ca/mortgage-calculator


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## WGZ (Feb 3, 2017)

Also 24 making similar money.

Found a brand new 180k condo (by Carlisle, cheap, questionable build quality, get what you pay for etc.) per month: Condo fee was 275 which included utilities, Mortgage 670, 80 property tax, and was eligible for a 2.35% rate locked for 5 years ... but it was a terrible location, brief walk through of units I was able to see a lot of build quality issues. They even told me there was already a crack in the foundation and the building wasn't even 6 months old...they were fixing it, and the building/units do have a 1 year warranty, but I steered clear of the place anyway.

Just couldn't tie myself down to that by sinking nearly all my money into a down-payment and getting stuck there for 10+ years.


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## Arnak (Feb 23, 2017)

I asked myself that same question every year for the last 10 years. This year I read The Wealthy Renter by Alex Avery. It's a short but very informative book about buying vs renting. I'll never think about buying again. If you care spending a few hours reading it, i'm not saying you won't want to buy anymore but at least you'll know what you get and what you don't get from it if you go ahead with that decision. It's a very good read. 

Cheer


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## rebel_ins (Apr 6, 2009)

Arnak said:


> I asked myself that same question every year for the last 10 years. This year I read The Wealthy Renter by Alex Avery. It's a short but very informative book about buying vs renting. I'll never think about buying again. If you care spending a few hours reading it, i'm not saying you won't want to buy anymore but at least you'll know what you get and what you don't get from it if you go ahead with that decision. It's a very good read.
> 
> Cheer


If you've enjoyed "The Wealthy Renter", I highly recommend "When the Bubble Bursts" by Hilliard Macbeth. He makes a strong case for first time buyers to wait for this market to cool down, and does so using actual research. It's my best read of the year so far.


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