Buying a condominium unit generally follows the same process as purchasing a single-family home. However, since a condo is a different dwelling style, some aspects are slightly different. If you’re planning on purchasing a condo, read on to find out what to look for when you’re buying a condo.
Research local construction
If you plan on buying a condo — particularly in an urban area — assess the surrounding area. For example, if there is vacant land, there may be an opportunity for new construction to go up, which could compromise the building’s existing views.
Inquire about renter vs. owner occupancy
Contact the building management or homeowner’s association board to find out how many units can be rented. If the building has too many renters, it may not be held to the same standards as if it’s owner-occupied.
Take the surrounding area into consideration
Condominium buildings are often in urban areas or by significant transportation hubs. Look around the area surrounding the building to assess the noise levels. If there are train tracks, bus stops, or bridges nearby, this may result in unwelcome noise levels.
Research the neighborhood
If you are buying the condo as an investment property or intend to eventually rent it out, having a grocery store, restaurants and public transportation within walking distance can help the unit appeal to renters.
Find out the number of unsold units
If a building has many unsold units, there may be a more significant issue with the building. First, find out how many units are for sale and how long they have been on the market.
Look into the homeowner’s association financials
Owning a condo means paying monthly assessments to the HOA. First, review the HOA’s financials, projected costs and reserve fund, and meeting minutes. This will provide insight into whether the assessments will be raised or if you will face an unexpected special assessment soon.
Know where the monthly fees go
Review the breakdown of the monthly fees to understand the maintenance costs. It’s helpful to compare these costs to the maintenance costs of a single-family home, such as landscaping, cleaning and snow plowing, among others.
Find out if there is any pending litigation
If there is pending litigation against the condo association, this could signal several issues. It could result in the monthly fees being raised to cover the legal expenses and larger issues with the HOA and management.
