Buying a new home is a delicate dance. From the initial search to the final price negotiations, everything needs to be tailored to the type of home you are looking for. However, because of their main differences, this process can look very different when buying a condo versus buying a house.
Reason #1: The Homeowners Association or HOA
As all condo owners will know very well, almost all condos come with some type of homeowners association or HOA.
The HOA generally handles common areas like swimming pools, the exterior of the building, and landscaping. Sometimes, the HOA may also beresponsible for holding social events throughout the year.
However, all of this comes at a few costs. The first is money; a HOA cannot operate or pay necessary expenses without charging residents a monthly fee. The second is freedom; most HOAs have rules that need to be followed.
When buying a condo, potential buyers will balance the costs of each HOA with the benefits.
Reason #2: Real Estate Investors
When buying a condo, it’s reasonable to expect a larger number of investors will be considering the property than when buying a home. After all, renting out condos is a big business. As a result, buying a condo places greater emphasis on being Pre-Approved for a mortgage, competing with cash offers, or even competing bids if the condo is on prime property.
Reason #3: The Type of Buyer
Different types of buyers look at a condo versus a home. For starters, condos are generally smaller, don’t have yards, have all landscaping handled professionally, and frequently come with amenities like a swimming pool or fitness center.
While a good majority of potential buyers with children would love a swimming pool with zero maintenance, they aren’t willing to make the trade for a smaller space. This means that when buying a condo, potential buyers will generally be single adults, newly married couples, or retired professionals looking to downgrade to an easier property.
Reason #4: Location, Location, Location
Every real estate agent knows that one factor, above all others, is most important when selling a property: location. Being close to town versus far away from traffic, near downtown excitement versus in a quiet neighborhood, or near shopping centers versus on the edge of nowhere all come into play for a property’s value and desirability.
Generally speaking, condos tend to be closer to urban areas, shopping, and entertainment. This also means that their price per square foot is frequently higher. As a result, owners looking to buy a condo should carefully consult with their real estate agent about the best way to make an offer at a fair price.
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