Woman moves from 1,100 sqft $800/month rental to a $233,000 450 sqft studio with an $800/month mortgage and $355/month HOA.
And then her HOA jumps to $630… and that’s after a $4,000 assessment for unseen maintenance.
Not a good sign… but here’s the key quote:
Dues increase is threatening her ‘affordable’ home
But Hernandez’s story underscores just how complicated creating affordable homeownership can be — not only at the level of building and financing but also in education and culture.
When she learned of her new dues she contacted the Mayor’s Office of Housing and asked for help in paying the increased homeowner fees. When told that this was not part of their role, she went in search of lawyers who might take her case. When no one accepted, she began to worry she might lose her home. If she couldn’t pay the extra dues, her homeowners association could put a lien against her condo, which could eventually lead to foreclosure.
She contacted the Mayor’s Office of Housing to inquire about reselling her unit, but when she learned that the value of her studio had declined, she worried that after real estate agent fees, she might lose her down payment altogether.
Matthew Franklin, director of the Mayor’s Office of Housing, assured me that this was not the case, that the agency had a commitment to making sure clients didn’t lose their savings upon resale. When I relayed this information to Hernandez, she sounded relieved. “Why would anyone ever buy a house if they could lose their down payment?” When I explained that in a declining market, for an ordinary home buyer — not one supported by a government program — it was indeed possible, she seemed surprised.
If Hernandez seems a little naive when it comes to appreciation and depreciation, she’s got good company. Like so many of us who came of “real estate-owning” age in the past decade, she’d incorporated the idea that real estate always goes up into her world view. In making her decision to buy her place, she recalled everyone emphasizing that this would all be a great investment because real estate always appreciates.
Uh oh, sounds like someone needs some Realtor(R) therapy.