US Real Estate- All You Need to Know About Condominiums

The condominium market is growing steadily. This has attracted many real estate buyers to invest in condos. If you are also thinking of investing in a condo and if it is your first time, then this post is a good read for you as we explain all you need to know about condominium.

It is an established fact, not every investor is a condo buyer. When it comes to US real estate investment, Condo buyers generally fall in three groups:

• First time buyers making the jump from renting
• People thinking to buy a second home that they will use part time
• Retirees who plan to sell off high end homes for low maintenance lifestyle a condo offers

What is a Condominium?

A condominium are basically townhouses or apartment style complexes. However, what distinguishes it from multi-tenant buildings is that the developer has legally declared it a condominium and buyers can purchase units in the building. Also, it has certain laws and regulations applied which the buyers must adhere to.

The owner of the unit is allowed to share common areas of the condominium development such as stairwells, fitness centers, rooftop gardens, swimming pool. Each unit owner holds an interest in these shared spaces.

Unlike a home buyer, a condo buyer is not solely responsible for the maintenance of the condominium. In fact, to manage the maintenance and repair of the shared common areas, a condominium development has a condominium association. This association is elected by condo owners. It makes communal decisions in the interest of the community.

Condo Costs

Condo costs usually include:

• Down payment
• Mortgage and property tax
• Condo fees
• Special assessment fees- This is usually requested when an unexpected repair of planned modification exceeds the cost of the condo fees collected.

Rules and Regulation to Live By and Adhere to for Condo Buyers

When it comes to US real estate, condominiums are governed by a set of rules. These are called Covenants, Conditions and Restrictions (CC&SRs). However, the rules and regulations may vary from one condominium development to another.

For example some condo development may impose restrictions on pet ownership, noise levels, kitchen and bathroom remodelling projects and even on renting. Therefore it is always a good idea to read the CC&Rs carefully to make sure that you are comfortable with them before you purchase a condo. This is especially advisable for those who have pets or who plan to rent condo units after buying them and generate monthly cash flows.