15 Condo Buying Tips
Dated: July 14 2021
How do you get the most appreciation from your condo asset? Here are 15 Tips to implement when purchasing a condo or townhouse.
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So you decided to take the plunge, and to purchase a condo! Today, we will discuss 15 tips to implement when you buy a condo. As I say to all my clients buying houses, homes, or condos; it doesn't matter what their price point is; you (unfortunately) won't get everything on your wishlist.
So I'm hoping out of these 15 tips, you will pick out a couple to support you in your search. Whether you're at a $300,000 condo, or $3 million home, you don't get everything on your wishlist. Think about trying to get 80%. There's no perfect spouse; there's no perfect house.
Condo Buying Tips
1) You will want to buy on the top level or the bottom level of a building. Think about it. Nobody wants to be in between two floors; those are the noisiest units. Condo buyers wish to have quiet spaces with privacy.
If you can't be on the top floor or the bottom floor, the most desirable units will be closer to the top. So if there are five floors, the fourth floor will be better than the third floor and so forth.
2) When purchasing a condo, look for homes with a private patio or outdoor space. Outdoor space is crucial, especially during COVID-19. This way, a resident can go outside and get some fresh air. I would not buy a condo without some private outdoor space. The second best thing to personal outdoor space is public outdoor space. Sometimes condos have beautiful rooftops or some gardens that you can take to walk. It allows residents to decompress in a personal environment; thus, more desirable.
3) So what is the number one rule of real estate? location, location, location. So while you're buying your condo, think about the area in the building. In other words, a corner unit is more marketable than a unit sandwiched in between two other properties. Or think about the quieter points of the building; perhaps not facing a busy street, but rather towards the back where there are softer noise levels.
When purchasing a condo, you might not be noise sensitive, but when you resell, or your tenants might be noise sensitive. Keep your ear out for noise levels.
4) Aim to buy a home with plenty of natural light. Corner units tend to have more windows than interior ones.
5) Views from the windows are essential. Sometimes the view is of another apartment building; sometimes, it's a brick wall; sometimes, it's the trash. Buy a condo that has a view where you're looking straight out. You might not be able to get an ocean view, but some pleasant scenery is paramount.
6) Layout: The Layout may be subjective; some of the most popular layouts separate two bedrooms with living space. This format provides the most privacy between family members and housemates.
7) Unit mix is essential. Which means how many bedrooms and how many bathrooms.. Depending on location, for example, if you live in Manhattan or L.A, and you can't afford a two-bedroom, a one-bedroom is just fine. Given the situation, think about who can live in a one-bedroom apartment. You definitely can have a single person. They can potentially have a spouse. So two people, (a couple). Perhaps the couple has a baby. After that, it may get tight; and they'll probably move out. It is likely you won’t have this long-term tenant for a one-bedroom. Now for a two-bedroom, you can have a multitude of living situations: a single person, a couple, two roommates, a couple with a baby, a couple with two babies. For example, I have tenants who have been living in a 600 square foot 2 bedroom condo for five years. And they started just as a couple originally; now, they have three babies. Five people currently live in their home and they are very comfortable. Having a second bedroom gives you room to expand. So for me, a two-bedroom, one-bath condo would be the minimum that I would purchase.
8) Upgraded features are essential. When they're buying their first home, most people say, "I don't want it to feel like an apartment."
So...how does one achieve the "non-apartment" feel... upgraded features! For example, upgraded bathrooms and updated kitchens. You don't have to worry about this too much because you can do some upgrades on your own. However, one important thing is a washer and dryer in the unit. I wouldn't buy a property without a washer and dryer. Again, if you live in Manhattan and it's not common, don't worry about it. But it's vital, especially for families that have small kids. They want that washer and dryer, and will pay more for it.
9) Another example of an upgraded feature is laminate floors. You need to check out the H. O. A. Rules if you're allowed to have laminate floors. Nobody likes carpet. So you want to have the option of putting laminate floors in your unit eventually; when you either rent it out or plan to sell it again.
10) Density is important too. In general, people enjoy having a smaller community versus a vast 100-1,000 unit condo building. Not to say that they're bad. It's just less desirable.
11) H. O. A. Fees versus Amenities: Typically most people would prefer less H. O. A. Fees and fewer amenities. People don't usually use pools and tennis courts. If that's something you want and you're going to use them, go for it. But in general, it's better to have fewer amenities and less H. O. A. Fees.
12) H.O.A Rental Policies: This is a deal-breaker for me because when I look at condos, I want to be able to have the option to rent it out. So you need to check out the H. O. A. Rules; if they allow for rentals. Sometimes you're not even allowed to rent the second bedroom. So you need to check that out, and many of them don't allow Airbnbs. If you want to do these things, you need to know before even putting in the offer.
13) Rental Ratio: In general, it's better to have more owners than renters. Depending on your lender, they won't allow you to take out a loan If there are more than 50% renters.
14 ) Reserves: H.O.A reserves are important to pay attention to. If there aren't any reserves in the bank, and a big problem arises (such as a roof leak or a sewer break), there will be a special assessment because there aren't any reserves to pay for it. Resulting in increasing the H. O. A. Fees.
15.) Lawsuits: The lender won't give you a mortgage if there are lawsuits or litigation. This is rare. It's not like everyone has lawsuits, but that is a deal-breaker for most banks and mortgages.
Those are my top 15 tips! Be sure to utilize them in your next search.
Natalie Alchadeff, Founder of the HB Group, specializes in helping buyers find their dream homes and sellers maximize profits – regardless of market cycles and economic conditions. Consistently ....