The Ins And Outs Of Buying A Condo

Hi friends,

So, you want to buy a condo. Congratulations! Buying a condo is an exciting but complex process, especially for first-time buyers. Keep reading for our breakdown of the top five things to consider before closing.

Understand the condo association and fees.
A condo association is responsible for managing and maintaining the common areas of the building, like the roof, hallways, landscaping, parking lots, and more. 

In order to adequately maintain these areas, the building will charge monthly condo fees that vary based on location, unit size, and amenities available–these fees range anywhere from a few hundred to several thousand per month. Be sure that you understand the condo association’s financial health, budget, and reserve funds–it’s important that they are able to cover the maintenance and repair costs of the property. You can ask for financial statements, minutes from association meetings, and the reserve fund study in order to get a full picture. 

Review the condominium documents.
Be sure to review all condo documents, including the Declaration, Bylaws, and Rules and Regulations. These documents outline any rules governing the property, like restrictions on unit renovations and the use of common areas. You should review these documents with a real estate lawyer to ensure that you understand all the legal terms and conditions. The lawyer can also identify any red flags, such as significant legal disputes or special assessments that could affect your investment. It’s not fun to find that your furry family member is not allowed on the property after the closing, for example. 

Check the reserve fund. 
The condo association should maintain a reserve fund to cover unexpected repairs and replacements of the common areas or the building’s major components. A well-funded reserve fund is critical to ensure that the association can handle any significant repair or maintenance needs that arise. Before purchasing, ask for the reserve fund study, which assesses the state of the reserve fund and the amount of money required to maintain the property over the next 30 years. The study will also indicate if any special assessments are planned or required to cover significant repairs or replacements.

Research the neighborhood and amenities.
When purchasing a condo, you’re not just buying a property, but also the lifestyle and amenities that come with it. Research the neighborhood to understand its character, the amenities available, and the overall quality of life. Check the proximity to public transportation, grocery stores, schools, and other essential services. Research the amenities available in the building, such as a gym, pool, or concierge service, and check if any additional fees are associated with their use.

Understand the resale value. 
While purchasing a condominium is an excellent investment, you also need to consider its resale value. Research the history of the property and the market trends in the neighborhood to understand its appreciation potential. Consider the demand for condos in the area, the supply of new construction, and the overall real estate market. When purchasing a condo, it’s also important to consider its layout, views, and upgrades, as these can also affect the resale value. Work with a real estate agent to understand the market conditions and the best time to sell your property.

Purchasing a condominium can be a fantastic investment opportunity, but it’s important to understand the condo association, fees, condominium documents, reserve fund, neighborhood, amenities, and resale value. We hope this guide gives you a foundation of knowledge that you can build on, so that you feel confident in your decision. 

Until next time, 
The BRIGS Team