Profile picture for petethedog

Condo vs. SFR

I am deliberating between 2 options. The first option is 1 BR completely new renovated condo in a nice neighborhood in Fairfield, CA. This place is nicely finished inside and out and all appliances are new. The second option is a 3/1 SFR foreclosed house in a mediocre neighborhood. After the upgrades it would cost about the same as the condo. My concern is the resale value of these places in 3-5 years. Particulary, the house is in a nieghborhood where there are about 20 comparable houses all in foreclosure. Which one is likely to hold it's value and/or increase? Thanks!
  • February 13 2009 - Fairfield
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Answers (3)

A couple of thoughts...your money tends to go further with a SFR because you won't have the same HOA dues.  HOA fees have been changing dramatically recently because so many of the associations are hurting financially (due to foreclosures).  In Fairfield, a 1 bedroom condo isn't going to skyrocket in appreciation and neither is a 3 bedroom 1 bath (the drawback being the 1 bath).  It also sounds like the SFR isn't in the best location.  Those kinds of locations are still experiencing decline because, like you noted, many are still going into foreclosure.  From an investment standpoint (looking past just "you" living in the property), the SFR is a better rental option than a 1 bedroom condo.
  • February 14 2009
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Profile picture for Jon Petersen
while single family residence's appreciate faster, so do better areas. If the condo is that much better, is would be a hard decision. One factor-condos have less costs of repair, but typically higher association fees.

Hard question to answer
  • February 13 2009
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Profile picture for sunnyview
Generally SFR appreciate better than condos. This choice is not exactly comparable is it though? I guess not knowing the neighborhood, I would still lean to the SFR mainly because of the appreciation issue and the condo fees every month. Condos are easier to build on small parcels and often condo owners compete with new complexes when they go to sell. That would be a concern for me. You might want to do a little more research on the neighborhood like on www.policymap.com it is free with email registration and I get no spam from them at all. The site can be a pain to use, but it will tell you about the number of ARM's and piggyback loans in both neighborhoods. Also the market reports here on Zillow may tell you if the neighborhoods you are looking at are at risk for dropping more and which one may be able to hold on to value better. Tough question. Do your research and trust your gut. Other folks may have more ideas to add about it too. Lots of smart bay area folks on Zillow.
  • February 13 2009
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