Condos can be a great home option for the right homeowner, from retirement age to college students. There are also some separate loan options for condo purchases. Is a condo right for you? Let’s weigh the pros and cons.
Pros
- Maintenance. Many condominiums require little maintenance from occupants. Monthly
dues cover yard maintenance and minor repairs, and someone else does it. Larger repairs are covered by reserve funds saved by the condo association. - Amenities. In many condo communities there are clubhouses, pools, exercise facilities, security features and others. These also do not cost extra.
- Condo Board. They are there to handle disputes with neighbors you might have otherwise had to handle yourself living in a single-family neighborhood.
- Cost. Many times condos are cheaper than their single-family home equivalent. This is beneficial if you like a certain neighborhood, but don’t want to pay the hefty price of a single-family home in the same area.
- Social Living. Many condo residents find that it is more enjoyable to build friendships with their neighbors who are in much closer proximity. There are also occasional social functions hosted by the condominium community or condo board.
Cons
- Monthly dues. Be careful with these ones. If cost is an issue, ample fees could make them more expensive than nearby single-family homes. Also, once the mortgage is paid off, the fees continue as long as you live in the condo.
- Limited Space. Likely you would have little to no backyard. Most condominiums have small porches or patios if anything. Some condos have garage or storage space, but not many. Factor in the monthly fees of rented storage space if you need it to get an accurate reflection of the costs.
- Less Privacy. You will likely have neighbors you live above or below, and at least one of your walls will be shared with another neighbor, so noise can be an issue.
- Resale. More often than not, most buyers are on the hunt for single-family homes. If this is an investment property, consider the location, too.
- Poor Management. Poor management can be detrimental to the overall value of the community, and you may unexpectedly find yourself paying hefty bills if management fails to keep a reserve fund for massive repairs. Research the community before you decide to buy.
- Condo Board. Like an HOA, they can sometimes get excessive with the rule making. Research the Condo Board in the community you’re interested in to see if you would have issues complying with their regulations. For example: If you are hoping to use the condo for subletting, Condo Boards can make this illegal. You will want to know that before you commit to the sale.
Thinking of buying a condo? We can help with all your financing questions. If you’re considering buying a condo to house your college student, ask us about the Kiddie Condo Loan Program offered through the Federal Housing Administration (FHA) loan programs.
