When it comes to homeownership, the traditional image of a single-family detached residence can be out of reach for many first-time homebuyers in today’s market. However, that shouldn’t deter you from pursuing your goal to purchase a home. Consider the benefits of starting with a condo as a stepping-stone purchase.
There are several advantages for first-time homebuyers to start their real estate journey with a condo. Condos have a lower price point than single-family homes. Affordability makes these properties more accessible for those trying to enter the housing market. Lower down payment and lower monthly payment needs make it easier to qualify for financing.
Maintenance costs are also likely to be lower for a condo versus a single-family home. The maintenance of the building and common areas is taken on by the Homeowners Association (HOA) leaving you with the flexibility of not having to deal with peripheral expenses.
While there are HOA dues, the reduced maintenance can alleviate stress, especially for first-time homeowners, who are still learning the ins and outs of home maintenance.
YOU MIGHT LIKE: The Mortgage Loan Process – Major Milestones
Affordability makes these properties more accessible for those trying to enter the housing market.
Another potential advantage is location. The affordability of condos could allow you to purchase in a location that may otherwise be out of your budget for a single-family home. Condos often come with great amenities. Ranging from pools and gyms to community spaces, they can have great entertainment options without the need for personal maintenance or upkeep. These amenities can enhance your lifestyle and add value to your investment.
While there are many advantages, you must consider the potential downsides of condos as well. One of these downsides is the HOA dues. These are an additional monthly expense that must be factored into your budget and it is prudent to know that these dues may increase over time. Ensuring that the HOA is being productive with the dues that are being collected could mean setting time aside for HOA meetings.
While you are paying your monthly HOA dues, it does not mean you may not have unexpected expenses. You can still be subject to special assessments if repairs or renovations outside of the planned HOA budget come up. Typically, large special assessments require votes from the homeowners but it is important to note the possibility of this when evaluating the overall cost of ownership.
DG PINNACLE RECOMMENDS: Mortgage Loans For Self-Employed Borrowers
The affordability of condos could allow you to purchase in a location that may otherwise be out of your budget for a single-family home.
Another downside is limited privacy and control. You will have shared walls and live in closer proximity to neighbors which means less privacy than a single-family home but if you are the social type, this could mean a higher likelihood of connecting with your neighbors. With the HOA also comes rules. You may not get to do all the exterior decor you would like but this also prevents unwanted or unsightly additions by neighbors. HOAs may also have restrictions with short-term rentals which is important to know depending on your long-term goals for the property.
Condos can turn out to be great first-time home purchases and set you up for success on your next home purchase. Consider the affordability, reduced maintenance responsibilities, desirable locations, and attractive amenities offered by condos as you embark on your homeownership journey.
If you have questions about getting pre-approved or have questions whether a condo is right for you, give us a call. One of our Mortgage Loan Officers will be happy to answer your questions and share their experience.
This article was originally published by Paul Centopani in www.themortgagereports.com