Can I get some wisdom from my favorite group of wise folks?
Here's the scenario:
-HHI: $100kish
-Debts: Student loans, $6k at 8.49% (to be paid off in January), $29k @ 5.5% (estimated pay off date August 2013), no interest accruing until April as I'm on IBR right now based on my wages in 2011 when I was still a student for 1/2 the year
-Emergency fund of $13.5k, not adding to it right now
-Paying $3200/month towards debt
-Necessary living expenses are within $100/month of being covered entirely by my salary (1/3 of total HHI)
-Getting married 5/18/13 :)
-Both contributing to our 401k's to get employer match; will increase to max after student loans are fully paid off next year.
-Monthly rent is $960/month for 2 bedroom in a condo building
In our building, a 1 bedroom has come up for sale for $44,900. Taxes are $1900/year, Condo dues of $183, 15 year payment at 2.75% would be $244/month with 20% down. Total, not including insurance, of $585/month
We're planning to stay in our current city only 3-4 years. I don't expect this property to appreciate noticably in that time nor do I expect rent would increase substantially. Based on emails w/landlord, condo is professionally managed and seems to be managed well, he gets prompt responses to any maintenance requests. Neighbors are all great so far.
Normally, I would never consider taking on more debt when we still owe on my student loans at those interest rates. But what a steal! If we bought this condo, we could rebuild our e-fund in less than 2 years from the rent savings alone (Almost $400/month). $40k is what we were planning on saving up for a down payment and our target for that was Dec. 2015. We've also been toying w/the idea of a gut reno property somewhere, but I don't know if we're really going to be here long enough to finish a project like that. NY Times Rent v. Buy says breakeven is less than 1 year; after 3 years the average annual savings is $4,346. We didn't want a condo because of all the unknowns with neighbors, noise, management, etc., but there's none of that since we already live here.
Can I get your thoughts on buying this condo?