Vital Tips For Buying a Condo
Condominiums have become a popular option that is worth exploring for prospective homebuyers. This article outlines some insider tips for purchasing a condo, including special considerations when buying one, how to appraise a condo owners association, an explanation of fees, and more.
Condominiums have become an increasingly popular housing option among buyers over the last few decades. They are multifamily housing where each owner owns their unit with shared ownership and responsibility of building exteriors and common areas. There are many good reasons to purchase a condo, but they are not the right housing option for everyone. Here are some tips for prospective buyers.
Determine Whether Buying a Condo is a Right Choice for You
Your first step should be to evaluate both the upsides and downsides of purchasing a condo. Condominiums are, on average, cheaper than single-family homes, require no exterior maintenance from owners, and can create a stronger sense of community among residents.
However, owners must pay regular fees to the association to cover the cost of benefits, cannot make exterior changes to the property without association approval, and condo units can be more challenging to sell than single-family homes. Therefore, prospective buyers should evaluate what they need and want in a home to determine whether a condo is a right choice for them.
Is It Right For Your Lifestyle?
Do you have a hectic lifestyle? Do you work long hours? Does mowing the lawn, trimming the hedges, power washing the exterior and all the extras that come with owning a home fit your lifestyle? If the maintenance that goes along with owning a home is not for you, then considering a condo can be better.
However, you must know that your space will not be entirely yours. You will share walls, floors and ceilings—both pros and cons with both.
Find a Realtor Who Is an Expert in The Condo Landscape
Once you have decided buying a condo is for you, you will need to find a real estate agent who is an expert in the area, knows about the different condo developments and has a proven track record in the sale of condos. A professional can guide you in addressing your concerns and guiding you through the critical steps, such as reviewing all condo association documents.
What Amenities Are You Looking For?
Each condo offers its own amenities. Some will cover the barebones of cleaning the exteriors and snow removal. Others may have swimming pools, gyms, outdoor grills and other luxury perks. You must know that the more luxurious amenities, though you may not use them, still can be worth it because they add to the value of the condo if and when you choose to sell.
You must address your needs as to the amenities you desire with your realtor. In addition, of course, location and budget are vital.
Know the Association Covenants
Condominium associations are governed by a set of documents called covenants, indentures, or by similar names. You agree to abide by these legally binding documents by purchasing a unit, so before you commit to the sale, you need to read these documents thoroughly. Of course, the contents of the governing documents will vary by community. Still, they typically outline how the association is to be run, the procedure for amending the papers, and state what is and is not allowed.
Be sure you are willing to abide by the covenants before purchasing a property in an association. If you go against the covenants, you may be subject to legal action. If necessary, you can have an attorney look over and explain the contents of these documents to you and answer any questions you may have.
Look For Signs of a Quality Association
A condominium association’s quality and current status vary widely, and you will want to vet your options when choosing a place to live carefully. Properties in well-run associations are more likely to appreciate in value, sell for a higher price, and be a more pleasant place to live.
Signs you want to look for include plenty of money in reserve accounts, strong owner engagement, regular association meetings, consistent and fair rule enforcement, professional management, and good leadership.
Red flags can include self-managed community, multiple units sitting on the market for prolonged periods, run-down structures, and too low or too high fees.
Find Out About Potential Special Assessments or Fee Increases
One of the significant downsides to living in an association is the possibility of special assessments, which associations can impose based on the rules outlined in the governing documents. These are assessments in addition to regular association dues, usually put in place for a particular project, such as needed renovations. They are of a set amount divided between all owners in the association and paid in installments.
Special assessments often require approval from owners in the community, but if one is agreed upon, you will be responsible for paying your share. Another potential concern is increased regular association dues, which you may also owe if current dues are not enough to sustain the association financially.
Ask Around the Neighborhood
As with looking to purchase a single-family home, it is always a good idea to meet your potential neighbors and ask anything you want to know about the community. For example, you can ask how close-knit the community is if grounds maintenance happens regularly and if rules are enforced consistently, and other questions that might be relevant. In addition, it’s usually a good idea to ask them what they like and don’t like about living there. The more opinions you hear, the more likely you see a fuller picture.
Now The Decision Is Yours, Buying a Condo vs. a Home?
Condominiums are an excellent choice for many buyers, but they aren’t suitable for everyone. Analyze your wants and needs against the housing options available to you, and you will have the tools to make the choice that is best for you.
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