need a space to live but also want to make the proper investment?

Question

Considering buying a condo or townhome in the bay area for myself but I also want to make sure its a good investment. I hear condos dont appreciate, HOA fees are wild and overall it seems purchasing a condo is frowned upon. Whats the best exit strategy when it comes to return and condos or townhomes?

Looking in the Eastbay/ Marin area

Wilson Lau · Answer

Hi @Kevin Dehesa, I am based here in the Bay Area and cover Eastbay and Marin. Condo prices (in many but not all neighborhoods) fluctuate more wildly with the economy, so the key is to purchase them at the right price. For condos, I would say the HOA is equally important. You want to review all the HOA docs to make sure the community is properly managed/ maintained so you don't run into issues like special assessments or Fannie Mae noncompliance.

Happy to connect and share more.

Ricardo R. · Answer

Hey Kevin,

I get where you’re coming from—wanting a place to live but not wanting to feel like you made a bad financial move later. Condos and townhomes in the Bay Area are a mixed bag, so here’s how I’d think about it if I were in your shoes:

• HOA fees – They can definitely eat into your returns, especially if they’re high and don’t cover much besides landscaping and insurance. But if they include big-ticket stuff like roof, exterior, maybe even water/sewer, then at least you know those surprise costs are covered.
• Appreciation – It’s true that condos generally appreciate slower than single-family homes. But in East Bay and Marin, location is king—if you buy near BART, ferries, or in a highly desirable school district, your appreciation will likely be stronger than average.
• Exit strategy – A few things help here:


Rental potential: Check HOA rules on renting. Some have strict caps or bans on rentals. If renting is allowed, you can always turn it into a rental later.


Resale appeal: Two-bedroom units in walkable areas sell faster because they appeal to both singles and small families.


HOA health: Ask for HOA financials—underfunded reserves can lead to surprise special assessments, which buyers hate.
• Rental potential: Check HOA rules on renting. Some have strict caps or bans on rentals. If renting is allowed, you can always turn it into a rental later.
• Resale appeal: Two-bedroom units in walkable areas sell faster because they appeal to both singles and small families.
• HOA health: Ask for HOA financials—underfunded reserves can lead to surprise special assessments, which buyers hate.
• Your main goal – If you need a place to live anyway, buying something that at least holds value or gives you rental flexibility later can still make sense even if it doesn’t perform like a single-family home.

HOA fees – They can definitely eat into your returns, especially if they’re high and don’t cover much besides landscaping and insurance. But if they include big-ticket stuff like roof, exterior, maybe even water/sewer, then at least you know those surprise costs are covered.

Appreciation – It’s true that condos generally appreciate slower than single-family homes. But in East Bay and Marin, location is king—if you buy near BART, ferries, or in a highly desirable school district, your appreciation will likely be stronger than average.

Exit strategy – A few things help here:

• Rental potential: Check HOA rules on renting. Some have strict caps or bans on rentals. If renting is allowed, you can always turn it into a rental later.
• Resale appeal: Two-bedroom units in walkable areas sell faster because they appeal to both singles and small families.
• HOA health: Ask for HOA financials—underfunded reserves can lead to surprise special assessments, which buyers hate.

Rental potential: Check HOA rules on renting. Some have strict caps or bans on rentals. If renting is allowed, you can always turn it into a rental later.

Resale appeal: Two-bedroom units in walkable areas sell faster because they appeal to both singles and small families.

HOA health: Ask for HOA financials—underfunded reserves can lead to surprise special assessments, which buyers hate.

Your main goal – If you need a place to live anyway, buying something that at least holds value or gives you rental flexibility later can still make sense even if it doesn’t perform like a single-family home.

If it were me, I’d:

• Focus on location first—close to transit or job centers.
• Find an HOA with solid reserves and reasonable fees.
• Make sure I can rent it out later if life changes.

Focus on location first—close to transit or job centers.

Find an HOA with solid reserves and reasonable fees.

Make sure I can rent it out later if life changes.

That way you cover housing now and keep doors open for the future; I hope this lays it out in an organized way for you and help you a bit @Kevin Dehesa, I sent you a DM on BP and hope you can assist.