You are in the market for a new home and a condominium interests you. It may be the first time you considered a condo and you are not certain about the process. Furthermore, you have heard that buying a condo is a risky proposition. You are scared that you will make a mistake and may regret your purchase. Here's how to buy a condo with your fears allayed.
- Know your local market. Buying a condo can be risky if you purchase a home in the wrong market. The price may be good, but the neighborhood may not be particularly appealing. Only buy in a neighborhood that is clean, safe, has local shopping and is convenient to public transportation. Settle for anything less and you may regret your decision.
- Find your ideal condo. Shopping for a condo means finding a place where you want to live. That means it has all the amenities you want, the living standard you prefer and the cleanliness that comes with it. You should have some standards in mind when you begin to look for a condo. If you want to be near shopping, then keep that in mind. If recreational pursuits are important too, then explore what is in the area. Also consider who your neighbors are â€” you'll hear them and they'll hear you â€” some places are simply too noisy while others may be too quiet for your tastes.
- Know the rules. When you live in a condo, there are rules that you must follow. Those rules are instituted by the homeowners's association (HOA) and must be followed by you. This means they can dictate a number of things, including some matters that may not sit well with you. The rules can be very restricting, limiting your ability to have guests stay over, keep a pet, decorate your balcony or patio as you see fit, and a host of other restrictions. Understand what the rules are â€” if you can abide by them, then you are in good shape.
- Find out about the condo management. The HOA committee is different from the condo's management. The condo management oversees the complex and authorizes maintenance and repairs. It is important that you read the board's minutes to determine how they work and have handled problems. If there are a lot of disputes, then run, don't walk away from that complex.
Condo matters matter. It is important that you understand who is living in the condo and what portion of the community is composed of permanent residents, renters, commercial interests and so on. When financing a condo, your bank may be very particular about these matters. The last thing they'll do is finance a condo that isn't stable. Commercial space should compose no more than 25 percent of the complex. Furthermore, the building should be adequately insured, in good condition, with enough money held in reserve. Most lenders require that the units be majority owner occupied. The last thing they want is a transient complex with tenants who have no direct financial stake in the building. Hire an attorney to look over the contract.
- Financing and insurance. You need to work closely with your bank to get the right financing for your condo. Expect to pay a slightly higher interest rate for your mortgage than you would for a single unit home. This also means speaking with several lenders to determine what they can do for you. Take the time to shop for a loan and you will save money. Your insurance is also important. Find out what the HOA covers and then get yourself adequately insured. This means working closely with an agent to get the type of insurance you need. Yes, you may need flood insurance even if you live on the third floor of the building explains Allied Moving Services.
Making the move to a condominium is a big deal. Make sure that it is the right place for you because selling can take much longer than for a house. But condo living can be rewarding if you prize not having to maintain a home and you live in a complex that is desirable. You may find that the unit you bought is a healthy asset, one that will increase in value over time.