Condo purchases are much different than single family home purchases. There are more things to assess before purchasing condos. This article provides condominium purchasing tips for Waltham MA first time buyers.
Definition of a Condo
Condominiums are buildings with two or more units sharing land and amenities. Shared components belong to the association and each owner has a percentage interest. The specific percentage is indicated in the deed for a unit. Condo owners are responsible for repair of the interior of their own units but share the expense of common items such as land. Because of the common spaces and expenses, it is critical for Waltham MA buyers to obtain information before purchasing a unit.
Information You Need to Know
Using Different Loan Programs
Mortgage approval may be contingent on certain information on a condo complex. For example, FHA requires minimum owner occupancy rates, minimum reserves, and a variety of other items. Condo complexes that are not or cannot obtain FHA approval will have fewer buyers. Buyers using FHA should determine whether a complex is approved prior to getting too far invested.
Every complex will contain a certain number of rental units. Higher owner occupancy percentages are better from a financing perspective. High rental rates also tend to be less desirable.
Reserves and Assessments
Most condo complexes implement monthly fees. The fees are for common expenses. A certain portion is also put into a reserve account to cover major repairs. It is important for buyers to know the amount of the condo fee, what is included, the history of changes, and whether it is expected to change. Buyers should also question the amount of money currently in reserve. If a association is not equipped to cover a major repair, all unit owners will be billed for the shortage. This is known as an assessment and can be a hardship for condo owners. Ask about previous assessments and any upcoming ones.
Rules and Restrictions
Condo owners must comply with rules that single family owners do not. Condo buyers should learn the rules and regulations ahead of time and decide whether they can accept them. Rules can regulate both common areas and interior spaces.
Condominium Purchasing Tips For Waltham MA First Time Buyers
There are conditions to owning any type of real estate, but condo purchases have some added components that buyers must understand. Entirely assess all documentation and speak to a real estate attorney. Also consider the resale value of units based on the financial condition of the complex and home loan qualification. Ask a real estate agent to provide the sales history in the complex. Details helps buyers make an informed decision about a condo purchase. This blog on condominium purchasing tips for Waltham MA first time buyers was prepared by Darleen Foster and Bradford Pratt at RE/MAX On the Charles . Contact Darleen at 617-448-7894 or DarleenFoster@remax.net and/or Bradford Pratt at 781-316-5760 or BradfordPratt@remax.net for details on a particular complex in Waltham MA or regarding other real estate topics.