Dang It Feels Good To Be A Renter

There can be very, very good reasons to remain a renter.  One of them occurred to me just this last week.

My apartment has vertical blinds.  Several months ago, I twisted something wrong, and ended up breaking the tilter.  As a result they became permanently stuck in a 3/4 open position.  I kept meaning to do something about it, and spent a few weekends tinkering with various replacement parts, but never succeeded in making it work.

Finally, I called the management office, and put in a maintenance request.  Less than 48 hours later, the problem was taken care of.  I didn't need to take time off of work, didn't need to find a competent contractor, didn't even need to pay anything.  That's part of the beauty of tenancy.  Your rent doesn't just pay for your lodging: it also includes the standard upkeep and maintenance.  For as long as I rent I'll never be responsible for painting or plumbing or anything of the sort.

Now, because I'm looking at buying a condo instead of a stand-alone house, I'll still get some of that benefit in exchange for my monthly HOA dues.  It won't be as comprehensive as what every renter has, though.  I'll be totally responsible for everything within the walls of my unit, for better and for worse.  That means more effort and time given to keeping my place looking nice, and also more unplanned expenses.

Expenses in general are kind of hard to judge.  There are plenty of calculators out there where you can plug in your purchase price, down payment, and interest rate, and find out how much you'll owe each month.  I'll look at that figure and think, "Oh, okay."  It's higher than my rent, but still reasonable with my paycheck.  I need to remind myself that it's just a piece of my obligations.  I'll also be paying property taxes, as well as homeowner's insurance, and HOA fees, all in addition to the unexpected costs that would come up.

HOA fees seem to be all over the map.  At the properties I'm considering, they seem to start around $250 a month and work up to just over $500.  It isn't always very clear why some are higher than others.  It makes sense that some of the difference can cover the various amenities.  It costs more to keep up, say, a pool, sauna, and exercise room than to not have those things.  Unfortunately, another thing that I'll need to consider is that low HOA fees may actually represent bad management... if they aren't responsibly collecting enough fees to cover everything, then residents can get walloped with an emergency assessment.

I would actually kind of prefer to find a townhome - these generally have much lower HOA fees, which works well for me, since I don't expect to take much advantage of the typical amenities one receives in a condo (pool, doorman, whatever).  Unfortunately, there are basically no townhomes in San Mateo County (at least not that I can find in the areas I'm considering).  Within the condo realm, you can save a lot on HOA fees, but it tends to go hand-in-hand with cheaper properties that are way out in eastern Contra Costa County or whatever.  And, conversely, the toniest high-rise condos in San Francisco charge more for just their HOA fees than I currently pay in rent.

One thing I'll need to investigate is whether HOA fees include any form of insurance.  I'm not at all clear on whether they generally do, occasionally do, or never do.  It would make buying look a lot more attractive, though, even if they just cover the physical structure and I still needed to purchase insurance for my possessions.

Because I plan to put down 20% for a down payment, it looks like I'll have the option to not use an escrow account for my insurance and property taxes.  I'm a fan of this option, for much the same reason that I like to owe income taxes on April 15th.  If I can hold on to the money for six months or a year, then I can bank it and collect interest before passing it along.  It makes things just a little bit more scary - missing either payment would be a Very Bad Thing - but I now have years of practice at Outlook reminders, email, and online payments, and am certain that this could continue to work out well.

Wow, that was a lot of rambling.  Bottom line: It's good to periodically take stock and see whether buying really is something that I want to do.  There are many good reasons to own - if you're planning to stick around for a long time like I am, then your home is insurance against constantly rising rent; it also gives you freedom to adjust your living space around you (though less so in a condo than in a traditional house).  That said, it isn't at all a clear-cut advantage over renting, and I intend to remain mindful about the reasons why I'm doing this.  Once I take the step, I'll be committed for a LONG time, so I want to ensure it makes sense before I commit.