Condominium sales have steadily increased in recent years. In many markets, condo living is preferred over traditional homeownership. You can often get the same amount of square footage, but with additional perks and amenities. Additionally, you don’t have to worry about snow removal, lawn care or maintenance. However, for all the upside there are also a handful of drawbacks with condo living. Some home owners’ associations (HOA) have strict rules and guidelines that cannot be overlooked. Items ranging from the color you can paint your deck to where you can park are strictly enforced. Without knowing what you are walking into upon ownership can leave you frustrated and disappointed with your purchase. Here are four important items to consider with condominium ownership.
Home improvement rules. Condominiums are run by associations. Every association has a different set of rules and bylaws that are enforced. Prior to making an offer you need to understand the pros and cons. The line about not being able to paint your deck a certain color wasn’t just fluff. In some associations it is very real. There are restrictions on what improvements you can make, and even how you can make them. You may not be able to have the front door be a certain color or hang a flag from your garage. You may not line the walk with flowers or put items in the windows. As silly as some of these may be, they are enforced by penalties and if pushed far enough can cause you to be thrown out of the complex. If you have visions of giving your unit a complete facelift upon purchase, you need to read the bylaws and know exactly what you can do.
Rental restrictions. There is a reason that you don’t see too many condo rentals. For starters, lenders often have strict guidelines on the number of non-owner-occupied tenants allowed. Every lender is different, but typically that number is right around 50%. If more than half of all units are rented, your loan will not get approved. This also works on the flip side as well. The association may not allow you to rent your unit after you take ownership. Even if you are able, check to see if there is an ownership period that must be met first. Your plan of living in the property for six months then renting after may not be allowed.
Fees. The condo association fees can range anywhere from $50 to $400 a month, or more, depending on the amenities offered. It is important to know which amenities are included with ownership. Even if the complex has a pool, tennis courts or private gym you may not be given free access to use them. There may be restrictions for when and even how they are available. In the condo bylaws it should detail everything about who can use the amenities. You may be surprised to know that ownership doesn’t give you carte blanch over the complex.
Parking. Parking in a busy condo complex can be tricky. Every unit is given assigned parking spaces in addition to the parking available on their property. If you are hosting a family function, or a get together with friends, you may violate the parking rules. This is subject to a fine and if continued could escalate the problem. This is magnified if the complex does not offer driveway or garage parking.
The pros of condo living often outweigh the negatives. Having an association run the complex can lead to its share of issues but can also be a great benefit. As long as you know what you are walking into, you should confidently pursue any condo.