Updated Surplus Numbers

Updated Surplus Numbers
Updated Surplus Numbers: Actual surplus 2018 per audit was $85,163.
Boards 2011-2018 implemented policies and procedures with specific goals:
stabilize owner fees, achieve maintenance objectives and achieve annual budget surpluses.
Any surplus was retained by the association.
The board elected in fall 2018 decided to increase owner fees, even in view of a large potential surplus

Average fees prior to 2019

Average fees prior to 2019
Average fees per owner prior to 2019:
RED indicates the consequences had boards continued the fee policies prior to 2010,
BLUE indicates actual fees. These moderated when better policies and financial controls were put in place by boards

Better budgeting could have resulted in lower fees

Better budgeting could have resulted in lower fees
Better budgeting could have resulted in lower fees:
RED line = actual fees enacted by boards,
BLUE line = alternate, fees, ultimately lower with same association income lower had
boards used better financial controls and focused on long term fee stability

Thursday, April 7, 2011

Should You Buy at BLMH?

It's sometimes useful to do the numbers. From a strictly financial perspective, which is to say, looking at the costs to rent versus the costs to buy, which is the more prudent decision?

How much would it cost to rent a 2 bedroom 1 bath, or better in 60189? Let's assume we were looking for something a bit nice. What would that cost?

Rentals in 60189 vary, but we could expect to pay in a range of $1,125 a month for 995 square foot and upwards. Currently there are rentals of $1,395 per month near the high end of the monthly rents.

So to make a comparison of rent versus buy, I'll use $1,200 a month as rent.

What would be our "out of pocket" costs if we were to purchase a condo at BLMH? I'll use the 2011 monthly fees and 2010 real estate taxes that I pay for my unit, which is a "B" unit as an example. However, it's important to realize that my condo is about 1,300 square feet, 3 bedrooms and 2 baths. So my fees could be higher than what you might experience.

Assumptions: 
Monthly rent $1,200.
Purchase at BLMH for $140,000 with 5% down and 4.89% 30 year fixed rate mortgage.
Include BLMH monthly fees and real estate taxes in comparison.
Other assumptions: Owner keeps the condo for 10 years, rent or property values increase by 3% a year over that 10 year period.

What's the result?
The cost to own is $15 per month more than renting.
However, at the end of 10 years, the owner would have $33,834 recoverable equity, after paying a broker a 5% selling commission.

Not bad! Think of it this way. If you purchase at current prices, and stay here for ten years, it's possible you will have saved the equivalent of $267 per month by owning, as opposed to renting. And that's after paying real estate taxes and monthly fees!

On the other hand, continue to rent, and pay your landlord. It's your choice!


Comments, Corrections, Omissions, References
Note 1.  There are units for sale at BLMH for less than $140,000. At that price, it's a bargain, and the numbers confirm it.
Note 2. According to Zillow, the unit above would rent for $1,425. I don't know if I could rent my unit for that, but it's an indicator of what I might expect to pay to live at BLMH.
Note 3.  According to Zillow (April 1, 2011) the mid point for Wheaton home prices are $259,900. That is, half of the houses in Wheaton are priced above, and half are priced below.

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