Important Considerations for Young Condo Buyers
Published April 6, 2016
Condos are extremely popular amongst first time home buyers. For good reasons! Purchasing a condo can give you all of the convenience of living in an apartment while still being a property owner.
Many young professionals choose to purchase a condo instead of a home because they simply don't want to deal with maintaining the exterior of a house. Mowing the lawn, raking leaves and shoveling snow are some of the many responsibilities that come along with home ownership. Choosing a condo instead of a house eliminates these worries.
Have you decided to purchase a condo? Before you sign that contract let's go over some important considerations young people should make before purchasing a condo.
Is your family growing?
One of the most common reasons people sell their first property is because they need more space. Many buyers purchase a small condo while single and then they have a girlfriend or boyfriend move in with them. Shortly after there's wedding bells and a baby is born! Now the condo is much too small for their growing family.
It's best to plan ahead if you anticipate your family growing in the near future. Purchase a condo with an extra bedroom or two. Not only will this give you extra room, larger units command a higher resale price as well.
A small condo makes an excellent bachelor pad but it's not the ideal living situation for a growing family. Take a good look at your relationship status and decide whether you should buy a property that will allow you some room to grow.
Do you own pets?
Are you currently a pet owner? Or do you plan on owning a pet in the near future? Be sure you pick the right condo! Most condominium complexes have strict rules regarding pets.
Certain animals are banned from ownership and even the ones allowed will have size and weight restrictions. If you always dreamed of rescuing that cute puppy down at the local animal shelter then you might be better off buying a house.
Another potential downside of condo ownership is the lack of a yard. Most condominium complexes have community areas outside and you must keep your pets on a leash at all times. Larger dogs require a lot of space to exercise and a small condo isn't the ideal environment for them. You wont be able to just open the door and let your animals roam the neighborhood.
Do you mind paying association fees?
For some, condos are easy and convenient because all of the exterior maintenance is handled by the association. However, this easy lifestyle comes at a price. These are called home owners association fees, or HOA fees.
This can be several hundred dollars every month adding up to thousands of dollars every year! Remember, these fees are in addition to your mortgage, taxes, insurance and utilities.
HOA fees cover the condominium complexes expenses such as trash, lawn maintenance and daily up keep of the common areas. Any complex with a nice community pool, gym or recreation area will have even higher fees. The condo association collects these fees from all of the condominium owners and manages the fund.
"Most condo buyers don't think of it, but you need to ask for a copy of the association's budget," says real estate attorney Donna Berger.
The association is not likely to give buyers a copy of the budget, but the seller -- as an owner -- can request a copy and provide it to the potential buyer.
The most important parts of that budget include the total amount of outstanding debt owed to the association and the percentage of owners who are not paying their dues.
Occasionally there will be a new expense such as replacing the common roof on a building. The good thing is you wont have to worry about the work. The negative is the cost will be reflected in your monthly HOA fees. They always go up slowly over time as well.
“Buyers need to question the association board about dues payments, and have their inspectors examine common elements before committing to a purchase. It's also important to review the financial documents that every buyer has a right to inspect before closing.” Says June Fletcher from the Wall Street Journal.
Some buyers love that all of the condos exterior maintenance is taken care of by the association. Others view HOA fees as an unnecessary expense and they don't mind doing basic home maintenance themselves. It's important to evaluate your lifestyle to determine what is right for you.
What are your hobbies?
Do you like working on cars? Racing dirt bikes? Gardening? Well, condo life might not be for you. You can find a condo with a garage and a storage area, but even then the space is usually limited.
You don't own anything on the exterior of the property and there are strict rules in regards to what you can and can not do in the condominium complex. Your neighbors might not react too kindly if you and your buddies are parked outside working on your hot rods at all hours of the night.
You probably wont be able to have a summer time barbeque and bon fire with your friends. Unless, you can use the community picnic area. Just be sure to keep the noise down and clean up before it gets too late.
Do you value privacy?
Condos generally offer much less privacy then a house. Many condo buyers dream of upgrading from apartment life to owning their own property. However, they soon find out condominiums have a lot in common with apartments. You will most likely be sharing walls with neighbors. Perhaps stairs and a hallway as well.
You have very little control over who lives next to you. You might have the perfect neighbors or you could be living next to an aspiring musician who chooses to practice on his drum set all day.
Condominium life is best suited for quiet people who don't require a lot of storage and privacy. Condos offer the ultimate convenience for young professionals who are busy with their careers. Just be sure that you evaluate your lifestyle to be sure that condo life is appropriate for you.