Buying A Condo Over A House
Condos are different and by condos I also include patio homes and town-houses in this.
The main differences between these and a house is that you are purchasing the space between the walls in the case of a condo and the space plus shared wall in the latter and you are a co owner and or co responsible for the common living areas.
You are part of a shared community with a common budget and the responsibly to maintain or to pay for part of the maintenance rests on the owners as a collective which is usually managed by an HOA (homeowner's association) which collects fees, organizes maintenance, oversees the rules set forth in the CC&Rs and the accounting.
When buying a condo you are buying into the community and that requires additional due diligence.
13 Tips And Items To Keep In Mind When Buying a Condo.
- Get an inspection. Just because the HOA covers lot of stuff does not mean you should skimp on the inspection. It's less expensive to perform on a condo and usually worth the money.Size matters. The HOA fees are usually dependent on the size of a unit.
- What are the fees. There are no standards for this. Each property has its own financial requirements and you need to know how much you'll be paying monthly and any additional buying fees and assessments.
- How does the HOA stand. The HOA collects the funds from the owners, but you need to know if it has used the money wisely, if they are in good standing. Communities with lots of non-paying owners may have cash flow issues.
- Are there assessments coming. Some older properties need major renovation. In communities where the HOA covers roofs this bill can be large and it may come in one large sum. Be aware if there are any assessments coming and who is paying for it.
- Who is in charge. Is the HOA self-managed or professionally managed.Read the CC&R's. The CC&R's will dictate the rules of the community and how it functions. You need to read this, usually large and mostly boring, document because the consequences could be dire if you expect one thing and get another.
- Get to know residents. The residents will tell you a lot about living in the community. Try to talk to a few as you're exploring the grounds.
- How many are owner occupied vs rented. The more renters the less more difficult it will be to get a loan or also sell in the future and owner occupied properties, in general, are better taken care of.
- Was it a condo conversion? Apartments turned condos are a different beast. The way projects are built to be apartments and condos are different: different amenities, construction, floor-plans and finishes. It's not necessarily bad, just different
- Who covers what. What does the HOA cover and what is the owner responsible for: roof, exteriors, interior plumbing, water, etc.
- Common space. How is the common space. Is it attractive, well maintained, functional.
- Construction. This could be a bid one, because you may want to know if the floors are wood or concrete, will they allow sound to travel because the last thing you want is the hear you neighbors.
- Parking. Which belongs to the unit and is there enough for you and possible guests.
- Location. In any real estate purchase location is important. Buying a condo on the outskirts of the city may not be advisable because this is where people prefer homes and it may be difficult to sell.
Phoenix Home Buyer's Guide
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