This is part 2 of the blog series: Reasons Not To Buy A Condo. In this update, we’ll be going over more reasons why you should think twice about buying a condo. If you haven’t read Part 1, it’s highly recommended you read that blog update by clicking here.

Condos Have A Lack Of Space

If apartment living felt too restrictive to you, condo living will most likely not feel any different. Since apartments and condos are very similar in nature, you have a lot of the same problems with space in condos that you may have had while renting. As mentioned in Part 1 of this series, you cannot expand your condo unit in any way unless it’s approved by the homeowner’s association. In this way, purchasing a condo is no different than renting an apartment.

You can easily find yourself needing more room for the things you’d like to buy while living in a condo. This also can be the case if you are looking on growing your family, as well. More members in your family also means more items and clutter for each person. This can slowly start to eat away at your free space and make you feel like your condo is even smaller than it actually is.

Condos Do Not Have A Yard

Most single family home purchases are due to the fact that the homeowner has a yard and the ability to expand on their lot. While they are buying a home, they are also buying the land that the home sits on. This allows more flexibility than owning a condo and many people like having the option to do more with their properties. This includes the ability to add personality to their homes by maintaining their lawns and adding rooms to the actual home if need be.

Condos have specific rules when it comes to remodeling and expanded rooms, and may outright deny them. If you are someone who wants the outside of your home to look a certain way, then condo living is not for you.  The condo’s community pays for all exterior maintenance and decorating of common areas. This means a condo unit owner does not have the freedom to choose how their properties look.

The Condo Fees: Homeowners Association Fees

One of the main reasons people buy a house over becoming condo owners is the uncertainty of homeowners association fees. The homeowners association fee is a specific amount of money that each condo unit owner must provide to the homeowners association to help with the cost of maintaining the property and repairs. Your real estate agent can help you determine the actual cost of the homeowners association fee before you purchase your home. And it’s highly recommended that you do so.

The homeowner’s association fee comes in addition to your mortgage monthly payment and can increase or decrease every year depending on the association’s needs and inflation. Also, if a condo community’s value increases due to the housing market, the homeowners association fee may also increase to mirror that. This means that your monthly payment can change by hundreds of dollars from one year to the next, on top of your mortgage payments. And this change is something you cannot control, unfortunately.

There Can Be Special Assessment Fees

Also be aware of special assessment fees. Special assessment fees can occur when there are major repairs that exceed the amount of the homeowner’s association budget. If repairs are needed that exceed the amount of the budget, the homeowner’s association will charge a fee to all condo units to cover the resulting expenses.

A special assessment fee can be a small fee of $50, or possibly up to thousands of dollars depending on the budget. This is why it’s very important to know exactly what the budget is for your condo’s community every quarter. You can tell if the homeowner’s association is spending money wisely and whether or not you should risk living in that specific community. Most underwriters will ask for the condo’s master budget plan during the home buying process so they can review the cash flow for this very reason as well.

Whether that special assessment fee is supposed to be covered in one month or is allowed to be paid through installments is also specified in the homeowners association guidelines. Once again, we highly recommend reviewing these documents before buying a condo, as your monthly payments can change drastically from one month to the next.

Hopefully we have informed you of some reasons as to think twice about purchasing a condo. If you are looking for more information on buying a condo versus a single family house, please check out the blog post on that as well!