DC First Time Homebuyer: Need Advice pls

[Erina Sin]

Hello,I would really appreciate some insight. I’m considering buying a condo in the SW Waterfront neighborhood (Potomac Place Towers) of DC, and am wondering if it’s a good financial decision. I already believe it’s a good lifestyle decision, but would like both things to line up.

• 25F, Single, Project Manager @ Healthcare
• Income: 90K of base salary (not including bonuses or stock options because unsure of exact figures). If career goes as expected over next ~5 years, this will be income floor, with average/ceiling being much higher.
• Assets: $70k investments (primarily retirement accounts), $50k savings account.
• Timeline: I like this area, and am committed to my role/team/company. I do consider going to graduate school (MBA) and in which case I would turn the property into a rental. I plan to try and hold for about 10 years.
• Current: Rent 625 sq ft studio for $1600/month in DC. (If I don't buy I would downsize to a studio 300 sqft for $1300)
• Condo: $318k for ~600 sq ft, 1 bed w/ balcony + storage. No parking included. The building has amenities - pool, 2 gyms, front desk etc. 3 blocks from metro. 
• Closing Costs: $4k out of pocket (less seller subsidy)
• Loan: $318k purchase price with 3% down for 309k loan amount. Preferred lender offering 3.125% interest rate.

Payment Breakdown:

• Principal and Interest: 1321
• PMI: 59
• Tax: 253
• Homeowners Insurance: 33
• Condo Fee: 400
• Total Monthly: 2066 (27.5% gross monthly income)

While I am increasing my housing costs by a significant factor compared to renting, it's right at part of the recommended 28% of monthly gross income. My only other debt is 250/month for health bills with 2.5 years remaining, retirement accounts (pre-tax 401k, after-tax 401k, back door Roth IRA) as well as start increasing contributions to taxable brokerage accounts (goal in medium-term is to significantly increase this). Current pandemic rate rentals in the building are going for $1750-1850 for a 1 bedroom though they have been on the market for quite some time. I picked the Waterfront area because of the development in this area (Phase 2 of the Wharf). I'm thinking of picking up waitressing shifts 1-2 per week in the Wharf to offset some personal costs and beef up savings. I thought about getting a studio apartment (but the monthly payment difference would be $300-400 month) and I feel like renting a studio would have higher turnover + more difficulty to sell later on.

Main Concerns:

Am I buying before a pandemic-induced housing market crash - aka at inflated prices?

While I expect to stay here for up to 5 years, my life circumstances could change. Buy vs Rent calculators are giving me lots of varying advice. I would try to hold onto the property as much as possible and rent it out if I go to grad school out of the city.

Schools in the area don't seem that great when looking online. How does this affect my decision?

Rising HOA costs over time. Other buildings in the area have HOA costs that are around $500+.

I Have no idea how to factor in above concern of housing market dip and how long that could take to recover from, as well as the potential future rental market if I decided to rent instead of sell.

• Felt like my post was disjointed, but figured I’d post and add detail later. Would appreciate any feedback especially those familiar with the DMV area!! All comments are welcome but please mention if you are from DMV!