Purchasing condominiums can be different from buying single families. There are more things to review. This blog offers condo buying guidance for MA first time buyers.
Definition of a Condo
Condominiums are complexes with two or more units sharing common areas. The exterior belong to the association and every owner retains a percentage interest in it. The exact share is commonly based on factors such as unit size. Condo owners must repair the inside of their own unit but share the cost of exterior areas such as land. Due to the shared spaces and expenses, it is very important for MA buyers to obtain certain paperwork ahead of time.
Questions to Ask
Not all mortgage programs can be used for certain condo complexes. For instance, FHA requires specific owner occupancy percentages, minimum reserves, and several other items. Condo complexes that do not meet these requirements may have a limited buyer pool. Buyers using FHA must determine whether a complex qualifies before spending too much effort viewing units there.
Owner Occupied Units
Most complexes have a certain number of rental units. High owner occupancy rates are more likely to comply with loan requirements. High rental rates may also create a different environment.
Reserves and Assessments
Most condo complexes require monthly fees. The fees are for common expenses. A certain portion is also put into a reserve for future expenses. It is important for buyers to know how much the condo fee is, what is included, past increases, and whether it is expected to change. Buyers should also look into the existing reserve. If a complex does not have enough to pay for a costly repair, all unit owners will be responsible for the shortage. This is known as an assessment and can be a large cost even if spread among the unit owners.
Rules and Restrictions
The biggest difference between single family and condo living relates to rules. Condo buyers should learn the rules and regulations ahead of time and determine whether they are acceptable. Rules can cover both common amenities and interior spaces.
Condo Buying Guidance For MA First Time Buyers
There are conditions to owning any type of property, but condo purchases have some additional components that buyers should understand. Thoroughly assess all documentation and get help from a real estate attorney if needed. Also think about the future market value of units based on the finances of the complex and loan programs available to buyers. Contact a real estate professional to provide historical information on sales in the complex. Details helps buyers make an educated decision about a condo purchase. This article on condo buying guidance for MA first time buyers was shared by Christopher Graves at Emery Federal Credit Union. Contact Christopher at 978-376-5389 or firstname.lastname@example.org or email@example.com for information on particular complexes in MA or regarding other real estate matters.