Condos—made up of multiple units that are divided and sold individually—are usually a good option for 1st time home owners or retirees.

No matter if you are looking for a condo to live in all year or just to use as 2nd home for vacations, you want to understand how they work.

This article will show you the reader why you might want to purchase one, or why you may not want to purchase one. Continue on to learn more.

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When you buy a condo, you own it. It is similiar to living in an apartment, except you own it where as an apartment you rent it. People who buy these types of units share the entire building including saunas, pools, exercise room, roofs, exterior walls, with the other unit owners. How Condos compare to other types of homes:

• Apartments – Apartments you will usually rent, and you will not be gaining any equity. Condos you gain equity through annual appreciation, and part of your payment going to principal. Just like a condo you will be living very close to your neighbors. So ifi you do not like hearing your neighbors, or smelling your neighbors, condos and apartments may not be for you. But on the other hand you can make a lot of new friends in these living situations, so that is a perk! With condos your neighbors will treat their property better since they own the unit, apartments are not always treated great.

• Townhomes – Townhomes are usually side by side and not up and down.A lot of times they will have garages. Townhomes will usually have a yard that needs to be taken care of, whereas with a condo this is taken care of with the HOA. Townhomes usually do not have a sense of community, as they just share a neighbor with the house they are attached to.

• Single Family – These houses are detached and very different from a condo unit. People who own single family homes have the responsibility of upkeep, utilities, and repair damage to the roofs and exterior walls. But this also gives you more power over your life, no HOA dues will ever be increased unless you are part of a strict HOA. The world is your oasis.

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The Pros and Cons of Condo Living 

The perks of condos:

• Your neighbors are your friends

• Insurance is cheaper

• You don't have to mow the grass

• Just walk to a pool to swim, walk to the exercise gym, easy access.

• Can use in lieu of hotels if this is your 2nd home.

But there are also some drawbacks:

• Lack of power when it come to exterior design.

• Strict external appearance rules.

• Shared ameneties.

• Low privacy compared to house

• HOA fees can be raised at any time

• Rules that become cumbersome.

While you as an owner can disagree with an HOA decision, if it's favored by others it will ultimately be a mute point. After weighing the pros and cons of condos, if you think it is for you continue on.

 

How to Purchase a Condo

Even if you’ve house-hunted before, you’ll want to do your own research before condo-shopping. It's a different process purchasing a condo than a house, the HOA is much more involved with the condo.

Additionally, getting a mortgage for a condo is a little bit more difficult than securing a home mortgage. 

Lenders are more careful about approving condo mortgages because not only are they looking at your finances, they’re looking at the finances of the Homeowners Association you’re joining. Lenders will sometimes require that a percentage of the units be owner occupied in order to lend on it. This is viewed as a safer investment to the banks.

 

If the condo development you’re investing in is mismanaged or has too few residents, the value of the property goes down. Lenders will then have less incentive to take a risk with your condo loan. 

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To help navigate the waters of buying a condo and getting a mortgage, there are some very best practices to use:

• Hire a good Realtor– With the buying process so complex with condos, you’ll want a Realtor that knows condos like that back of their hand to assist you. Realtors that are experts in the condominium market will know which condos have the best real estate value and are managed properly.

• Research the properties yourself before viewing – While having an experienced realtor to turn to is awesome, you’ll want to do some of your own research. When looking at condos, be sure to ask who takes care of what items on the property.

• Decide what amenities are must haves in advance – Perhaps the greatest boon of living in a condo building is the easy access you a have to the best amenities. Be sure to let your realtor know upfront what kind of amenities are non-negotiable, like a tennis court, pool, or cat park. This will help nyour search. Remember that the better the amenities are, not only will it make your life easier, you’ll also be choosing a property that will be easier to sell down the line when the time comes. If you would like to hire a property management company in Oklahoma City, click here.

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