Should I get a car now and drive to work? Or get a condo instead and live near my area of work?
Late this year, I’ve been thinking about finally getting a car by next year. The past 6 years of commuting and queueing to work is slowly taking its toll on me. Gets me tired, haggard, sweaty at times and late despite of leaving home very early. I live northeast of NCR, in the province of Rizal, and I work in Makati CBD. Travel time usually takes 2 to 2.5 hours. Was asking my self why not get a car by next year, with some extra cash flow I will have. With a car I can drive to work and avoid the increasing challenges of commuting.
Comfort vs Cost
A car will help me own my time more. I can go to places more easily and without restrictions of public transport. Presumably it will also make my way to work easier in spite of rush hour traffic. I also fear that our MRT sytem will get far worse in the years to come before it gets any better. Less toxic, more comfort but for a higher cost of living. Was in fact asking around already the usual fuel costs my colleagues up north incur when they bring a car to work. Add to that the daily parking fee, insurance, vehicle add-ons, registrations, tests, tune-up, cleaning, accessories, license renewals, etc. Plus the temptation to go to vacations and road trips more often because of increased accessibility. And of course the monthly car loan amortization for the next 3-5years.
My rough estimate for fuel, amortization and parking alone is Php14k a month. I have a sunk cost of Php5k a month which is my fare allowance, so with a car that amount will be used instead for fuel etc. My incremental cost is then Php9k a month. I also plan to create a carpool in my subdivision to at least partially offset my daily costs.
Charm of Condo
Then encountered pre-sell condominiums for sale for as low as Php10k monthly for the next 3-4 years (down payment portion). Saw a pre-sell one near my place of work. Living a alone in a condo away from my family was never a plan for me. Until now. Considered this option which will also cost me around Php14k a month (downpayment payable for 3 years). So the question now is car or condo? With the condo, my monthly amortization will reach Php20k once the unit is turned over in 3years time (home loan for the balance), plus other costs such as association dues, utilities, unit furnishings, food, laundry, groceries and other incremental costs of living alone.
Advantage though is that I’m purchasing an investment (whereas the car will only depreciate over time) and this will also make my way to work a lot easier (though not as soon as having a car). Value appreciation vs vehicle depreciation. Risks are also much higher though. A condo is definitely a bigger ticket investment than a car. It will also be a longer cash flow commitment via home loan. Other options will be to lease the unit or sell it once price goes up. Though right now I’m more inclined to live in it.
Getting a condo over a car requires lots of guts and risk appetite. But for me, I’d rather spend on an investment with some comfort down the road, rather than spend for comfort now with only a depreciated car left after 5 years. Delay of gratification. Until next time car, for now I’ll go for condo first.
If you were in my situation, what would you do?