There are plenty of reasons why you may prefer purchasing a condo over a house. Buying a condo can be looked at as the happy medium between having a space to make your own with luxury amenities that apartments have and not having to worry about all the upkeep or higher cost of maintaining a house. The price tag of a condo is typically less expensive than a house in the same area. You still get to own your home and may have less responsibility than someone who buys a house. Before you base your decision off having a swimming pool, nice gym, and no yardwork, there are a few things to consider:
Occupancy Requirements for First-Time Financing
To be financed with a conventional loan, the complex you are buying into must be 90% occupied. Among that 90% that needs to be occupied, at least 50% of the owned units must be primary residences or second homes. To be approved for an FHA loan there are other requirements. You can do a search to find out if the condos you are interested in are FHA approved by following this link.
What are the biggest cons?
Try to research notes from condo board meetings. Better yet, talk to current owners. What are people complaining about? Does it seem like the association is slow on responses and solutions to problems? If so, you may want to reconsider.
Where will you put all your stuff?
Do you like to ski in the winter, kayak in the summer, or travel? Seasonal activities are fun, but you still need a place to store everything for the months that you aren’t using it. Many condos do not have an attic or garage. Be sure to ask if you will be provided with extra storage space. If not, you may want to consider buying a house instead.
Are you planning to move soon or stay a while?
Keep in mind that condos appreciate value at a slower rate that a house. It could be more difficult to profit from selling your condo once you decide to move.
Condos have association fees too!
Maybe you thought a condo would mean avoiding HOA fees. You’re right! You will not pay HOA fees, but you will pay Condo Association fees which are typically higher than HOA fees. This is because the Condo Association must pay for the upkeep of the amenities and common areas. If a condo advertises “Ultra Low Dues” be careful. What might sound like a great deal could turn out to be a “you get what you pay for” type of effort when it comes to maintenance. If the Condo Association fees seem too low, you may want to keep looking.
Just because you have a balcony doesn’t mean you own it
And maybe you would rather not own it! If you look at the unit deed and determine that the Condo Association owns the balcony then it is likely their responsibility to take care of the wear and tear as it ages.
Ready to buy a condo?
If your heart is set on a condo and you are ready to move forward after weighing the pros and cons, reach out to learn about our mortgage loans! We offer excellent rates and a variety of options to fit your needs. Click here to get you application started!
Sources:
https://budgeting.thenest.com/differences-between-condo-fee-hoa-fee-30432.html
https://www.moneycrashers.com/questions-ask-buying-condo/
https://themortgagereports.com/16161/fha-approved-condos-fha-mortgage-rates
