How to Buy a Condo
Whether you’re looking at making a condo your very first home or venturing into the condo market for the first time after apartment or single-family home living, the process can be a bit of a curve ball for those unfamiliar with it.
Much like buying a single-family home, you’ll be the owner of any condo unit that you buy. Much like living in an apartment building, you’ll have many neighbors, shared spaces, and community rules that you’ll have to live by. But that’s not all to consider.
There are several additional elements to buying a condo that you’ll need to consider before putting ink to paper. From finding the right Realtor who specializes in condo sales to guide you through the process to making a mortgage work, there’s a lot to consider.
Whether you’re new to the condo market or are just getting back in the game after a while, here are the basics of how to buy a condo.
Decide where you want to buy
First, you’ll want to decide where you want to live. There are stunning condo buildings in a variety of spectacular locations across the United States. From exclusive islands off the coast of Miami to Midtown Manhattan, when you’re in the condo market you have nothing if not plenty of choices.
Even if you’re relocating within your city, you’ll want to determine the exact location where you want to live. Do you want to be in the middle of it all so you can walk everywhere you need to go and live a car-free lifestyle? If so, you’ll probably want to select a building in an urban center that’s near public transportation. Do you want to live in a towering building with unbeatable views? Then you’ll want to be looking at high-rise condos exclusively.
The key is to figure out your must haves, your nice to haves, and what you can live without. This is the rubric that you’ll use to analyze all of the potential buildings and units for sale.
Determine the amenities you want
Next, you’ll want to figure out what kind of in-building and on-site amenities you want. Do you live in a warm city where a rooftop pool is essential? Maybe you live in a colder place where you want a state-of-the-art fitness center complete with an Olympic-size lap pool to stay fit during the winter?
If you have furry members of your family, you’ll need to ensure that the buildings you’re looking at are not only pet-friendly, but that the particular size and breeds of your pets are allowed in the building as well.
One thing to consider that many people overlook is guest parking. If you’ve got a car, chances are you’ll be prompted to figure out where you’ll park it, but what about when you have guests over? Especially if you like to host, you’ll need to determine what the guest parking situation is.
Is there dedicated parking for guests? How expensive are nearby parking garages? What about street parking — is it metered or otherwise restricted? How many public transportation options are nearby? These are all things that will greatly determine how easy (or not) it is for people to visit you in your new home.
Work with an experienced Realtor
Once you know what you want, the next best thing to do is connect with an experienced Realtor. While any Realtor can help you buy a condo, one who is experienced with the condo market will not only have a sense of what’s coming up on the market, but they’ll know the questions to ask in order to find you exactly what you’re looking for.
Focus on FHA-approved condos if you’re using a mortgage
If you’re planning on taking out a mortgage loan to pay for your new condo, you’ll want to focus on FHA-approved buildings. An FHA-approved condo means that the loan you’ll take out to buy your unit is insured by the Federal Housing Administration. These often come with lower down payments since they’re generally intended to be a resource for first-time homebuyers.
Buildings are either approved or not approved for these loans based on whether or not the requirements set out by HUD. Some of the requirements include that the building’s construction be completed and no more than 50% of the units are used as rentals or investor-owned, for example.
This might seem like a daunting task, but luckily the Department of Housing and Urban Development has a handy guide on their website that lets you easily search FHA-approved buildings.
Meet with the HOA
Most every condo building will have a homeowners association, or HOA for short. This group of people, often comprised of fellow residents, is essentially in charge of running the building at large. This means everything from the repair and management of common spaces and shared amenities to rules around leasing out units and short-term rentals.
This group of people will have an influence on what life is like in a particular building. Once you narrow your list down to a final couple of buildings — especially if you’re having a hard time deciding between them — one of the best things you can do to aid in your decision is meeting with the HOA. This gives you an opportunity to get a sense of how they run things and ask any lingering question about life in the building that you might have.
Factor in special assessments ahead of time
Speaking of meeting with HOAs and asking questions, one thing you should inquire into is any special assessments that are on the horizon. Any well-managed HOA will have a sense of special assessments that are planned for the near future and will be able to tell you about them, how much they’ll be, what they’ll be for, and how often they typically occur.
Especially if you’re on a budget, you’ll want to get a sense of these future costs so you can plan accordingly.
Learn about the property management company
Sometimes buildings use management companies to carry out some of the responsibilities of the HOA, from staying on top of repairs to handling rental leasing and the like. If the building you’re eyeing uses a property management company, you’ll want to get to know them the same way you’ll want to get to know the HOA. A management company — and how professional, experienced, and organized they are or aren’t — will play a major role in life in your future condo home.
