Buying a condo might seem like a good idea if you’re on the edge of moving to your own home, especially from the financial angle, but there are some things you should take into consideration before doing so. The thing that will initially induce you into error is the initial buying price, which is significantly lower compared to other options, but have you even wondered why that price is so low? Here are some facts to why a condo is not a good investment:
1) Administration Fees
In an apartment building, a condo is just another brick in the wall, and that “wall” is not cheap to maintain. Besides the condos, the building also contains common areas, such as:
• Laundry Rooms;
• Swimming Pools or Exercise Rooms.
An administration fee is paid by every condo owner for the regular maintenance of these common spaces. This fee is usually compared to a credit payment but what people fail to take into consideration is that, while a credit is totally paid out at some point, with no further payments being necessary, this does not apply to the administration fee. You pay this fee as long as you live in the building and, added up to initial buying price of the condo, you’ll see that that “killer deal” you made initially is only killing your budget.
Privacy is the second major disadvantage of living in a condo, or, to put it better, the lack of it. Come home at 2’o’clock in the morning and all your neighbors will know it. Listen to music at a higher volume and you’ll end up with the neighbor underneath or the one above knocking on your door. Not to mention the trouble you’ll have with kids running around or crying in the middle of the night. Still thinking of buying a condo?
What turns a house into a home is the way you personalize it, adapting it to your lifestyle and needs. While you’re mostly free to decorate the interior of a condo the way you like it, there’s very little or nothing you can do about its exterior. You’ll need the building administrator’s approval for any modifications you want to bring to the common area, which includes the space right next to your door. This means you won’t be able to change your door to a better-looking one, paint the outside walls in your favorite color or even add some flowers or decorations to enhance the atmosphere. Not quite the “home sweet home” feeling, is it?
4) Resell Value
Considering you’ve been living in a condo for a while and you want to move out you’ll face up another problem: resell value.
Unlike a house, a condo usually has a very low resell value, exactly for the reasons presented above. This detail is usually overlooked when buying a condo because it doesn’t have immediate repercussions but will leave a great hole in your budget when selling it.
By this point you should be pretty convinced why a condo is not a good investment, but what alternatives do you have?
Well, one thing is clear: if you want quality you should be willing to pay for it. The price difference between a condo and a house can be quite consistent but so are the advantages.
However, if you feel that buying a house is a bit out of reach for your budget, renting it can also be a good alternative. There are better solutions than investing in a condo; you just need to be willing to look for them.