Condos come with many perks, but they aren't for everyone. However, they can be a great way to dive into homeownership without worrying about all the upkeep that comes with a single-family home or townhome. And, condo owners can also take advantage of shared amenities, plus having professional management to take care of building maintenance is always a key benefit -or at least we think so!
Whether you should buy a condo, a home, or rent really comes down to where you are in life, and what your preferences are. Today, let’s tour the benefits of why a condo might be a great path to homeownership.
What is a Condo?
Short for condominium, a condo is a single unit within a multiple-unit property, usually an apartment style building or community. It can be one of many units in a shared structure like a high-rise building. You can also own your own unit, share common areas and amenities of the community with your neighbors. This includes perks such as: parks, pools, playgrounds, gyms, and other public spaces.
Most condos are part of a homeowner association (HOA) that makes and enforces rules for its property. Condo owners are primarily responsible for maintaining everything within their own unit and must pay mandatory membership fees for the upkeep of common areas and building maintenance costs.
Benefits of Condo Living
- One of the biggest benefits of living in a condo is that other people do the maintenance for you. So, if you dislike doing things such as mowing the lawn, trimming hedges, shoveling snow, or replacing siding (just to name a few), then condo living may be the way to go.
- Condos are also a good option for those who want to age in place as neighbors are nearby, experienced maintenance staff will take care of big repairs and there are community activities!
- Condos can often be found in downtown areas and represent the most cost-effective way to get the big-city lifestyle.
- Some condos offer gated or have locked entries, doorkeepers or professionals for residents. If you live alone this could certainly be reassuring.
- Dreaming of a pool or perhaps a fitness center? Many condo associations offer these types of resident amenities. If you’re an outgoing person, or simply like the hustle and bustle of having others around, a condo can be a great way to meet new people
- Condos are less expensive. They are usually the more affordable real estate investment properties. The median sales price for a condominium in October 2020 was $273,600, according to the National Association of Realtors. In that same month, the median sales price for a single-family home was $317,700.
- Lower pricing can make condos a more affordable option, especially for first-time home buyers. While investing in a condo might be the more affordable option, you must consider condo fees. However, even with these costs, the average condo is smaller and thus cheaper than the average single family rental property.
- Bottom Line: Find an area you love and do some research. Remember, if you’re on a tight budget a condo can be a great first step.
- Your monthly mortgage payment builds home equity when you own a condo.
On the flip side… here are a few cons of living in a condo:
Homeowner Association Fees (HOA) & Rules
- Most condos offer services that other real estate properties do not like a fitness center, swimming pool, security system, etc. And, because of this, the HOA fee can range from $100 to $700 a month depending on location and other factors.
- At times, the condo owner’s association may levy a “special assessment,” or a significant fee charged to each condo owner to cover major updates or upgrades. For instance, replacing a roof, resurfacing a pool deck, or upgrading plumbing.
- With fees, come HOA rules. These rules apply to you and your tenants which include things such as parking, pets, renting out your condo, etc. Tip: Make sure to review all rules and regulations first to determine if it will be a good investment for you.
Lack of Privacy
- In a condo you have neighbors on the other side of your walls and perhaps above and below you as well. If you’re looking for peace and quiet, a condo may not be a good fit for you.
Parking and Storage Issues
- Some (not all) condos have assigned parking which may mean a longer walk to your front door.
- Storage is sometimes limited, and some condos do not have any outdoor storage space. Are these types of things important to you? We suggest making a “Needs and Wants” list to help you decide.
- If you’re planning on investing in a condo, make sure that you can rent it out as you like. Some condos may prohibit rentals, while others have specific rental restrictions.
Is buying a condo worth it & should you consider it?
- When evaluating if a condo is the right investment for you, it’s a good idea to take into account more than just the location and mortgage and factor in the monthly condo dues as well.
- You like the apartment lifestyle: If you’ve been renting and want to ease into homeownership, a condo could be a fantastic first step.
- You’re busy: If you have a crazy work schedule that requires lots of travel, a condo may be a good choice to avoid a lot of exterior upkeep.
- You’re older and want to downsize: Condos are great for older folks who don’t want to deal with property maintenance and all the hassles that come with it.
Evaluate all the potential positives and negatives before you decide to invest in a condo. If you decide a condo is a good fit for you, make sure to read and review the condo’s association documents. And, before you agree to buy a condo, make sure they are in good financial condition.If you’re ready to take the next step into condo ownership click here to get your free pre-approval.
If you want to talk to one of our Loan Experts – reach out. We’re happy to answer any questions you may have.