First off, insurance will be less than $100/month. We play less than that on our house. I believe all you need to insure for a condo is the interior as you don’t own the exterior. Probably depends on the condo layout, etc, but I would figure closer to $50/month and it may be even less than that. FYI, our insurance is through Farmers in case people want to see if they can do better.

Secondly, from what I know and truly believe, rents NEVER go down. I moved here is 1994 when the market was tanking and my rent went up every time I renewed my lease between 1995 and 1998. Eventually, it was just plain stupid to rent as I paid less each month to buy.

20% down tied up could be risky, but only in the short term. Meanwhile, positive cash flow seems to be within reach in the short-term. If the property is in a good location where it will have a high occupancy rate, there isn’t too much risk. If the numbers work, they work.

I agree that now is not a great time to be buying condos as they will most likely decrease fairly significantly in short term, but it really isn’t a bad deal if you are in for the long-term.

As for people predicting 40-50% depreciation in property values, I think you are crazy and have little justification besides correction to the mean. A correction to the mean doesn’t have to happen instantaneously and likely won’t. Probably spread out over the course of 5 years, which means maybe 20% or so is a reasonable amount to predict.