Log in Subscribe
Making Sense out of Dollars

Condos & Co-ops, Pt. 2 of 6

WHAT ARE THE pros AND cons OF CONDOMINIUM OWNERSHIP?

Joel Lerner
Posted 10/7/22

As you can see, condominium ownership can offer some important benefits. Here are some of the other advantages of owning a condo unit:

· It usually costs less to buy a condominium than to …

This item is available in full to subscribers.

Please log in to continue

Log in
Making Sense out of Dollars

Condos & Co-ops, Pt. 2 of 6

WHAT ARE THE pros AND cons OF CONDOMINIUM OWNERSHIP?

Posted

As you can see, condominium ownership can offer some important benefits. Here are some of the other advantages of owning a condo unit:

· It usually costs less to buy a condominium than to buy a private home.

·       Condominium projects are professionally maintained, thereby alleviating much of the anxiety of owning your own home. This can be especially important for the elderly, who may want to escape chores such as painting, shoveling snow, and trimming hedges.

·       Safety and security are usually tighter in a multiple dwelling such as a condo apartment complex than in an isolated private home—another important consideration for older people in particular.

·       Finally, the sharing of costs among a large group of owners permits luxu-ries those individual homeowners usually can't afford—swimming pools, tennis courts, golf courses, and the like.

This is not to say that condo ownership is without drawbacks or pitfalls. Here are some cautionary notes to consider before making a condo purchase:

 

·       When investigating a particular condominium project, check the quality and condition of the property carefully. Make sure the plumbing, electri-cal, and heating systems are in good working order. The developer should be willing to certify the condition of the structure. If the condominium is in a newly built development, don't rely on assurances that special facili-ties, such as a pool or golf course, will "soon be available." If these ameni-ties are not in place and operating when you buy, you may never see them.

·       When you own a condo, all decisions concerning the common properties of the condominium project are made by a management committee and ratified by a vote of the individual owners. The weight of your vote depends on the size of your unit; the bigger your apartment, the more votes you will have. Nonetheless, the wishes of the majority of owners will normally prevail. Can this become a problem? Yes, if decisions are made that affect living conditions at the condo in ways you don't approve, the prohibition of pets, for example.

·       The maintenance fee you pay is not permanently fixed. It may increase because of ordinary price inflation or have to be boosted if the maintenance budget initially set by the developer was unrealistically low. Also, weather damage to common property, such as the havoc that Hurricane Katrina caused in 2005 may play a role in raising maintenance costs. This is something to consider carefully before buying in climate-risk areas.

·       Monthly carrying charges (for, say, building maintenance of lobbies, drive-ways, systems, services, etc.) can be lower than they are for co-op apart-ments of similar size, because there is no building mortgage to amortize. But not owning common property may not always be an advantage. If a condo building needs money for major repairs, such as a new elevator or expansion of social areas, and there is no cash reserve available, each condo owner is assessed for the cost of the repair.

 

THOUGHT FOR THE WEEK

The bad news is time flies. The good news is you are the pilot.

Comments

No comments on this item Please log in to comment by clicking here