27 percent of the US population (74 million Americans) live in a condo or an HOA property. To keep up with this trend, you’re considering buying a condo. You feel that investing in a condo is a great deal as condos cost less than single-family homes. Also, condos offer lower-maintenance living and enhanced security.
However, before you buy a condo, consider these five things.
You should consider the future when planning to buy a condo. You want to invest in a condo in a great neighborhood. The goal is to pick a rapidly growing area to increase your condo’s resale value in the future.
So, look for online resources that’ll help you review real estate trends in various locations. The idea is to buy a condo in an area with an upward-rising real estate market.
2. Condo Rules
One of the disadvantages of buying a condo is having to abide by the HOA rules. The problem is that different condo communities set different rules. Some insist on condo insurance as part of the condo ownership contract.
If you choose a condo with this insurance rule, compare different condo association insurance policies. To ease tasks work with a reputable independent insurance agency.
Your goal is to invest in a condo with friendly and flexible HOA rules.
3. Condo Financing Options
You must take time to compare different condo loans and how they work. You want to determine these loans’ requirements to check which one(s) you qualify for. Also, you should review the cost of getting a condo mortgage to confirm you can afford it.
Here are some of the most popular condo financing options: • Conventional loans • FHA loans • VA loans Compare the eligibility requirement of these condo loans and their costs to decide which one best fits your needs.
4. Condo Costs
All condo owners must pay a certain periodic fee to cover ongoing maintenance costs. So, before you buy a condo, find out more about these costs. You want to avoid investing in a property with condo hidden costs.
Also, you want to know beforehand how much it’ll cost you to live in a condo. The goal is to be certain that you can afford the condo costs before moving in.
5. Reserve Funds
Condos set up reserve funds to cover major repairs and replacements. The money is usually held in a special account with a licensed financial institution such as a bank. Before buying a condo, ensure there’s a reserve fund with adequate money.
You want to avoid a situation where you and other condo owners have to cover costly major repairs and replacements.
Get the Right Information Before You Buy a Condo
To decide whether to buy a condo, carefully review the above things. Find out the condo cost and review the available financing options. Also, review the HOA rules to avoid violations later once you buy the condo.
Finally, confirm there’s enough money in the reserve fund to avoid high condo fees.
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