Published on October 16, 2015 If, like Adam, you’re wondering if buying or renting makes more sense for you, try the math with our calculator. Search Homes For Sale; Mortgage Calculator; Guide To Buying A Home The right location One of the biggest game changers when deciding on a condo is the location. Renting may be a more popular choice for millennials who simply can’t afford to spring for a home, but with rental costs gradually increasing is it still the better choice than opting for homeownership? 2021 RE/MAX Direct. If you have a good credit and a modest entry-level income, then you might be able to afford a condo. Instead, he financed with private mortgage insurance (PMI). Here are 5 more reasons why investing in a condo is a great choice for your first home: How much are you paying for rent now? SHARES . He chose to buy a condo in a smaller city to bring down the cost of ownership, as well. First time buyers who don’t consider condos are doing themselves a disservice. Here are 5 more reasons why investing in a condo is a great choice for your first home: 1. A condo located in a nearby university or an urban spot guarantees that your neighbors and fellow condo owners are young families, grad students and young professionals. Just take your dog out for a walk, or cycle around and you might just meet a new friend! Share Tweet Pin LinkedIn Google+ EMAIL. I also knew I didn’t want to throw gobs of money at a landlord for rent. If they do, then great! phone (484)712-0009 phone (484)467-6489. “My decision to buy a condo has paid off for me,” Adam said. “I was a 23-year-old kid who had a short- to mid-term commitment to a general area. A house generally offers much more space than a condo, giving you room to grow. Condos can be more affordable options for first time home buyers. Read our commenting policy. Tools such as an affordability calculator can help you understand which condo price ranges are suited for you and your salary. This lets you begin to build equity, which could make it easier to trade up to a home, especially if the condo increases in price by the time you sell. Like a single-family starter home, condos are an excellent first step into homeownership, giving buyers a chance to obtain a mortgage and become homeowners at a lower cost and with less responsibility than a single family home purchase. Whether he chooses to stay in his condo or sell it and use the equity he’s built to move up to a bigger place, he’s happy he decided to become a condo-owner early in his 20s rather than renting. Yes, condos generally appreciate in value. Opting for a condo is a great investment even when you plan to live in it temporarily. Maybe.”. So, are you excited to commit to a new place you can call home? Take the Homebuyer Education Test. Share Tweet Pin LinkedIn Google+ EMAIL. Tools such as an affordability calculator can help you understand which condo price ranges are suited for you and your salary. 5 Reasons Why A Condo Makes A Great First Home Jon C. McBride. You may not have much of a choice with a limited budget. 1. Home; Buying. You Can Save Money. Zillow research claims that rent has significantly grown at about two times the speed of wages. Here are 5 more reasons why investing in a condo is a great choice for your first home: 1. Published on October 18, 2015. Here are 5 more reasons why investing in a condo is a great choice for your first home: 1. Here are 5 more reasons why investing in a condo is a great choice for your first home: 1. This includes... © Copyright You will have a broader scope of options with the same budget when looking for condos. Generally speaking though, a condo complex can be wonderful for young first-time home buyers or retirees, but it’s usually not ideal for people craving more privacy and autonomy. So, are you excited to commit to a new place you can call home? “I'd rather have a pile of cash to rely on for emergencies and other expenses, and just pay the negligible PMI each month.” After 5 years in his condo, Adam is close to cancelling his mortgage insurance. How much are you paying for rent now? So, are you excited to commit to a new place you can call home? The chances to meet new friends increase because there are common recreational spaces and areas to mingle in. But, if you’re trying to decide between a condo or a house, keep in mind that a single-family home is usually going to grow in value faster than a condo will. Calculate if you should save up for a big down payment on a house or buy right now. Starting October 3rd, home buyers who wish to apply for a mortgage will receive a new rate and fee quote... Buying a home can be a scary thing, this type of purchase involves a long term commitment from maintenance to financially. If it's on the outside, it's generally the condo association’s responsibility.” That means that if you live in a place that tends to snow, like Adam does, having snow removal and provided services is a big benefit compared to buying a home. We'll let you know what's new but we won't clutter up your inbox. In many areas, a condo may be priced a bit lower than the average purchase price of a house. Before signing the agreement, check to see if the homeowner association would allow you to rent out your place. If you have a good credit and a modest entry-level income, then you might be able to afford a condo. Tools such as an affordability calculator can help you understand which condo price ranges are suited for you and your salary. Living in a condo means that you can save time instead of doing outdoor and lawn chores such as trimming the hedges or mowing the grass. Published on October 18, 2015. If you have a good credit and a modest entry-level income, then you might be able to afford a condo. For example, an association fee of $250 monthly is comparable to an additional $50,000 on a 30-year mortgage with a 4.5% interest rate. But if your dishwasher dies, there’s no landlord to take care of it: You own the condo, you deal with it. As far as the location goes, buying a condo will give you more flexibility on where to live, because they are slightly cheaper than … When it comes to deciding whether to rent an apartment or buy a home, condos are like the middle child: often forgotten, despite their many sterling qualities. The short answer is: You buy a condo like you would any other home, so it's yours to own. Chapter 3: Condo Mortgages Getting Your Personal Finances In Order . ", Get My List of TOP Homes in Chester County. Comparing Condo and House Prices . Buying a Condo in 2019 | Pros Vs Cons | First-Time Home Buyer Tips Michael jumps into the Pros and Cons of buying a condo. Are you still doubting your financial capability to buy a house of your own? So, are you excited to commit to a new place you can call home? Buying a condo or townhome as your first home allows you to live in your ideal location while saving money and becoming part of a secure, caring community. He chose to buy a condo in a smaller city to bring down the cost of ownership, as well. These can include: Fewer Responsibilities – When you own a home, you are responsible for absolutely everything. Tools such as an affordability calculator can help you understand which condo price ranges are suited for you and your salary. Here are 5 more reasons why investing in a condo is a great choice for your first home: 1. Now that you’re armed with a solid understanding of condo ownership, you have the tools you need to evaluate whether it’s a good choice for your situation. There are also other trade-offs to owning a condo. If you have a good credit and a modest entry-level income, then you might be able to afford a condo. SHARES . The owner of the condo pays only a small portion for building maintenance. If your condo management team is active, they would also probably get in the community spirit and host meet-and-greet events to get to know your condo neighbors better. "However, I quickly realized that the $250 a month that my condo board charged me for the pleasure of being under their management was drastically overpriced. Here are 5 more reasons why investing in a condo is a great choice for your first home: 1. Adam followed advice he received from friends and family not to stretch his liquidity to cover a 20% down payment. If you have a good credit and a modest entry-level income, then you might be able to afford a condo. We do not post inappropriate or abusive comments. We use cookies on this site to enhance your experience. Owning a condo is very similar to renting an apartment, except that the owner has the freedom to modify their unit as much as they like, as long as it’s within the written standards set forth by the community. Why? Here are 5 more reasons why investing in a condo is a great choice for your first home: 1. (Am I a middle child? As rental rates continue to rise and interest rates increasing, now is a good time to buy your first home. The cost is lower than other forms of housing. “In order to get into the condo sooner rather than later, I put down 5% instead of the full 20% down payment,” he explained. Tools such as an affordability calculator can help you understand which condo price ranges are suited for you and your salary. 1200. That condo in college neighborhoods or downtown areas are still probably lower than a single-family home in the same location! A condo also provides the benefit of free recreational space and activities, some external repairs, and water might even be included in the HOA (homeowner association fees). In the current market, you are probably paying more for your rent … All Rights Reserved. Learning the terms, negotiating the loan market…even if you’re not a first-time buyer, there’s a lot to consider. Bousley, who owns two condos, says one of the perks of buying a condo is not having to bother with the typical chores that go along with owning a single-family home. A condominium is a very good starter home as they were intended to. Tools such as an affordability calculator can help you understand which condo price ranges are suited for you and your salary. “I bought a $100,000 condo with a 5% down payment – an amount that’s similar to a car down payment,” he said. A condo might be more limited in terms of space when comparing to a single family house, but monthly fees and utility bills will be smaller as well. Home... Statistics have predicted a better performance this year in the housing sector than all the previous years. Here are 5 more reasons why investing in a condo is a great choice for your first home: 1. For those considering their first home purchase, a condo may be a better fit in terms of budget, space, and the stress a condo can save you—here’s why you should consider a condo for your first home. Why You Should Consider A Condo For Your First Home. That’s true of any piece of property—as long as it doesn’t have wheels or come from a trailer park. “It’s pretty straightforward, actually,” Adam explained. If he had purchased a single-family home, his maintenance expenses would probably be comparable over time, if less predictable. Not all HOAs allow this, and it helps to check every detail before you commit to putting money down. Adam viewed buying his 2-bedroom condo in Germantown, Wisconsin, as a stepping-stone to his future — except this stepping-stone also grew money. ), I never considered buying a condo in my 20s, but it was the first move for my friend Adam after he graduated from college and left the parental nest. Renting may be a more popular choice for millennials who simply can’t afford to spring for a home, but with rental costs gradually increasing is it still the better choice than opting for homeownership? Lower costs and included maintenance make condos attractive to first-time home buyers, but compared to single-family houses, condos have risks. Not to mention I've rented out a room, which makes the actual monthly expenses even cheaper,” he said. At the same time, home buying benefits like home values that retain their pre-recession prices and very low mortgage interest rates have been consistent in almost all areas. As … By dismissing the idea of condos, buyers limit their choices – and may be limiting their … You’re free to paint your kitchen electric pink, but you have less control over your outdoor space. While this may not necessarily be a bad thing, one angle to look at location is to go for a developing area or one that has potential for appreciation. A house is usually located in a much quieter location than a condo, which is a plus if you like peace and being close to nature. Buying a first home means assuming responsibility for maintenance and repairs, something your landlord may have handled previously. But as long as I’m living there too, I’m free to rent my extra room out to anyone.” However, if Adam decides to move and rent out his whole condo, he’ll only be able to do so if the condo association agrees. That means you can do what you want with it – to an extent. As mentioned earlier, living near the heart of a bustling urban city is more costly than selecting suburban houses farther out. Adam explains it this way: “If it's inside the walls, it's my responsibility. “I bought a $100,000 condo with a 5% down payment – an amount that’s similar to a car down payment,” … We can help answer any tough questions you have. There’s no doubt that renting a house gives you quietness and privacy when you need it, but the more affordable ones are pretty far out on the suburbs. This makes it a bit more difficult to get out when you want to visit your favorite hangouts, or eat at your local dining restaurants. This is especially true for condos, which offer a number of fantastic opportunities but also present a range of complex challenges. So, are you excited to commit to a new place you can call home? A fair cost comparison considers the amount of a condo's association fees upfront and adds that sum to the total cost of the house or condo. Living in a house, in a suburban neighborhood also limits your day-to-day encounters with neighbors and those in the immediate vicinity. The only bonus I would have at the end of renting would be my security deposit. If you're a potential first-home buyer, then you know just how confusing the property market can be. Here are 5 more reasons why investing in a condo is a great choice for your first home: 1. Lower initial price . So, are you excited to commit to a new place you can call home? So, are you excited to commit to a new place you can call home? I didn’t go in expecting any appreciation, since the value of condos tends to stay flat. My condo association has a rule that a certain percentage of units be occupied by owners, not tenants. As I have seen in my experience as an investor—and initially as a part-time investor in my early days—condos may be good investments, but they do behave and perform a little differently. Adam explains: “Condo associations have their own set of bylaws and rules, so mileage may vary. Will My Home Purchase be Delayed with the New Mortgage Disclosure Laws? A lower purchase price means a lower down payment and less money to come up with out of your pocket. For some people, buying a condo as their first home has advantages. Tools such as an affordability calculator can help you understand which condo price ranges are suited for you and your salary. Study up and then test your knowledge! 5 Reasons Why A Condo Makes A Great First Home Published on October 18, 2015. A first time home buyer may be thinking of finding the condo that is closest to their current workplace. Then, if and when I decide to move, I’ll have some added flexibility with the extra cash I get from selling.”. I can send you a list of handpicked homes for you and your family to look at. 1200. They had incredible depth of knowledge of the local area and constructions. Tools such as an affordability calculator can help you understand which condo price ranges are suited for you and your salary. "I initially assumed a condo must be a good idea for someone who did not want to take care of maintaining a house," Little says. “I’ve gained about 15-20% on my listing. First, You Should Get Pre-Approved. With a condo, you have substantially fewer responsibilities. But the market went up, and now I have this nice bonus. Most first home buyers who decided to purchase a condo will agree that the advantages well outweigh potential downsides. If you have a good credit and a modest entry-level income, then you might be able to afford a condo. For instance, you won’t have to worry about mowing the lawn, raking leaves, or shoveling snow. Buying a condo as your first home means getting a mortgage loan, and a mortgage means paying a down payment. Tools such as an affordability calculator can help you understand which condo price ranges are suited for you and your salary. Here’s the quick argument for buying a condo: Buying a condo as your first home lets you get onto the property ladder sooner, because condos are generally cheaper than houses. 1200. According to a recent survey by the National Association of Realtors only 2 percent of home buyers said buying a home for financial security was their primary reason. How much do you know about buying a house? So, are you excited to commit to a new place you can call home? Renting may be a more popular choice for millennials who simply can’t afford to spring for a home, but with rental costs gradually increasing is it still the better choice than opting for homeownership? So, are you excited to commit to a new place you can call home? How'd you guess? Less space means you can easily heat up or cool down your home whenever you need it. Are you ready? They want people invested. By continuing to use this site you agree with our use of cookies. So, are you excited to commit to a new place you can call home? In the current market, you are probably paying more for your rent than springing for a mortgage and homeowner association fees, combined! If you have a good credit and a modest entry-level income, then you might be able to afford a condo. Readynest reviews all comments to ensure a respectful dialogue, so your comment may take a day to appear. If you have a good credit and a modest entry-level income, then you might be able to afford a condo. You’re wasting your time if you head out condo-hunting, but don’t have an accurate measure of what you can honestly afford. Tools such as an affordability calculator can help you understand which condo price ranges are suited for you and your salary. 5 Reasons Why A Condo Makes A Great First Home Sophia Polk. I would rather explore the differences. Homeowner association fees should cover all of that. You won’t even need to start shoveling snow in order to get to work or the local mall! I didn’t have any grand plans to move to a new city in the next 5 years. Home equity: Probably the main advantage for being a condo owner over a renter is that condo owners gain equity in their real estate over time. "Our experience with Andrea and Melisssa was wonderful. After a few years or when you need more space to live in, you can put it up for renting and earn a little income along the way. Whether it's understanding different types of condos, researching l I am not going to label the condo as better or worse than a single-family house as your first investment. Since your first purchase can feel a little bit overwhelming, here’s a walkthrough of what you should know when purchasing your first condo. In addition to a mortgage payment, Adam pays a monthly fee to the condo association to cover building maintenance costs, shared services (like snow removal) and contingencies. This factor drives down the costs of upkeep and maintenance even lower (even when factoring in homeowner fees with mortgage) as compared to renting a house. Share Tweet Pin LinkedIn Google+ EMAIL. Plus, dwelling in a community property saves you precious weekend time to do something you love instead of participating in a weekend maintenance project. What to know before you buy a condo. 5 Reasons Why A Condo Makes A Great First Home Ian Bush. For Adam, the decision to purchase a condo instead of renting has worked out even better than he planned. Ultimately, it comes down to your lifestyle and your list of must-haves and deal breakers when searching for a home. Buying a condo as your first home means getting a mortgage loan, and a mortgage means paying a down payment. If you have a good credit and a modest entry-level income, then you might be able to afford a condo. I did the math and realized by purchasing a condo I’d have about the same monthly expenses as renting while also building equity, giving me an investment that will grow as I live there. It might be a little bit similar to apartment living, but there's a lot of other benefits to having a condo be your first home purchase. No need to … First-time homebuyers can get overwhelmed quickly. Living with his parents for a while helped Adam save for a down payment, but it wasn't a huge hurdle. “When I look at the cost of renting a comparable apartment, I’m paying just a touch more to own per month, and I’m also building equity. No condo fees, or unexpected assessments! Living with his parents for a while helped Adam save for a down payment, but it wasn't a huge hurdle. I would rather explore the differences. And your salary a suburban neighborhood also limits your day-to-day encounters with and... 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