The pros and cons of buying a condo in today’s market

The pros of buying a condo

 

1. Maintenance and repairs off your plate

Condos offer prospective buyers the ability to earn equity like a homeowner without the pressure of maintaining the home's condition or surrounding property. Your condo association will take on the responsibility of shoveling, landscaping, painting or paving any exterior part of the home. Though this does come with a required monthly fee, the benefits may outweigh the cost if you're not interested in upkeep.

2. Luxurious amenities

As a condo owner, you co-own all the shared spaces and amenities offered by building management. From basketball and tennis courts to state-of-the-art gyms and outdoor swimming pools, there are some amazing condo communities out there offering many luxurious amenities that are inaccessible for those purchasing a standard single-family home.

3. Affordability

Buying condo property offers more ownership opportunities to prospective homeowners. Their price difference compared to other types of real estate make them an attractive alternative to look into. You’ll find that condos are typically cheaper to purchase than standard homes. The average price for a condo in 2021 was $289,000 while the cost of a single-family home was $334,500. This added wiggle room in your budget will let you sift through prospective condo properties and strongly weigh your options when it comes to the amenities and guidelines that are most suitable for you.

4. Move-in ready

Some condos can be bought fully furnished. This removes the stress of lugging large pieces of furniture and decor into your new space. And if interior design isn't your forté, you won’t have to worry about going through design layout options that will bring your place to life.

5. Sense of community

Condo owners become part of a larger community once they move into their new homes. With a closer proximity to neighbors, you’ll be able to foster meaningful relationships with surrounding homeowners to potentially become life-long friends. It’s important to keep in mind that not all communities are structured like this, so do your research when looking into potential properties.

6. Security

Condo complexes often provide residents with security features, such as call boxes, 24/7 guard patrol and doorman services. The larger sense of community will also help you feel more relaxed when leaving your home for extended periods of time.

7. Improvements

Unlike an apartment, you fully own your property after you purchase. This gives you free rein to tackle the home improvement projects you want to take on to make the place feel more like you. Paint as many bedrooms and drill as many holes as you’d like. There won't be anyone stopping you!

8. Accessibility

Many condos today are located in different cities full of life and energy. This is great for people looking to explore new restaurants, shopping boutiques and concert events. The close proximity can also make walking an ease, saving tons on transportation expenses like gas and routine maintenance.

These condos are also great for working professionals uninterested in sitting in hours of traffic during their commute. With a home close to a city-based job, you can get to work with less stress and hopefully a smile on your face.

9. Condo associations

There are many benefits to having a condo association. Funded by current residents, this board acts as an overseer when it comes to upholding community rules and regulations. They’ve also taken on the responsibility of making sure you're comfortable in the community you’ve chosen to live in. From preventing large gatherings that’ll keep you up past 12 a.m. to organizing community events, they want every resident to always be happy and comfortable where they live.

10. Equity

If you’re not ready to give up apartment amenities or your sense of community but would like to establish a financial future for yourself, condos can be the right option for you. That’s because condo owners can earn equity on the home they’ve purchased.

Home equity is the total financial portion the homeowners possess after their initial investment and monthly mortgage payments. By contributing on a monthly basis, you have the chance of increasing your property value. This puts more money back into your pocket should you decide to sell.

The cons of buying a condo

 

1. Fees

The luxurious amenities provided by condo complexes come at a cost to the residents. To maintain the property, security services, fitness centers and outdoor pools, the condo association charges a monthly fee. And after reviewing our breakdown of potential fees above, you can see that this is also added on top of your mortgage and other expenses.

It’s important to keep in mind that association fees have a tendency to increase on a yearly basis. To avoid the risk of pricing yourself out of your home, make sure you have increased fees factored into your budget.

2. Condo association regulations

Choosing to live in a condo means you have to abide by community rules. For example, there could be pet restrictions and guidelines as to when and where you can host events. Also, there could be a limit to the number of cars allowed per unit.

Always ask questions regarding community rules and regulations when searching for a condo. This will ensure the community aligns well with your lifestyle.

3. Resale challenges

Condos can be difficult to resell because of the narrow pool of buyers interested in these properties. Families with multiple kids often want yards and some people may be turned off by the idea of living by someone else’s rules.

The costs associated with condo living also make the buyer pool smaller. The condo association could demand fees higher than a prospect can afford. And with the potential of those fees rising in the future, it makes purchasing the home a greater financial risk.

4. Lack of privacy

Some might view the apartment-style design of condo communities as a downside. You could potentially live above or below someone, hearing all their celebrations or arguments. You might want to rethink this option if you’re coming from an apartment complex and can't handle another rowdy neighbor disturbing your peace.

5. Delinquency

A condo community relies heavily on the financial contributions of its residents to keep things running smoothly. When others fail to keep up with their association dues, the remaining residents are responsible for taking on the extra weight.

6. No land ownership

When you purchase a condo, you’re only buying the property, not the land beneath it. You and the other community members own an interest in the land together. When you buy a home, however, you purchase both the property and the land it’s on. But if you're not interested in outdoor maintenance, this could actually be an advantage!

7. Limited storage

Condos generally don’t come with as much storage space as a home. This will limit the amount of personal possessions and large items you can keep in your unit. Some complexes offer additional storage units, but they are often not large enough to house significant items.

Sources: Quicken Loans | Investopedia