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The Commonwealth Blog

Monday, October 30, 2017

Should You Buy a House or Condo?

Buying a new home can be a challenging proposition. There are so many options on the market, and knowing what’s right for you can be hard to determine. For example, many Boston-area residents must decide whether to purchase a traditional single-family house or a condominium. There are positives and negatives to each. While condos often have included maintenance and lower initial costs than single-family homes, there are risks to condo ownership.

Here are several items to consider if you’re a homebuyer choosing between a single-family home, condo, or other property:

  • Location and lifestyle
  • Monthly fees, including maintenance
  • Rules of ownership (such as HOAs or condo associations)
  • Lending terms and total price

We’ll examine the benefits and pitfalls of houses and condos to help you decide which home type is best for your living situation.

Where’s the Best Location for You?

You’re more likely to find condos in the center of city action, near restaurants, shops, and public transportation. If you value being close to downtown and being within walking distance of amenities, a condo might be the better fit for you.

However, if you prefer having more space, a private yard, and more distance between you and your neighbors, a single-family home might be more your speed. You may still be able to live in a similar location but may have to make other compromises to get the home you want. Moving out to a suburb with good transportation options may allow you to have the best of both worlds. Discuss what’s best for you with your Realtor and anyone with whom you’re purchasing your home.

Monthly Fees and Maintenance Costs

Many condos include association fees that cover maintenance and repairs. This arrangement allows you to see your costs upfront and pay for them monthly, but it means you’re paying even when repairs for your unit aren’t necessary.

If you’re buying a single-family home, it’s necessary to set aside money for any issues that come up, such as HVAC repairs, water heater damage, etc. If you like knowing upfront what your costs will be, a condo might be better for you. If you’re okay saving for eventualities, a single-family might be a good fit.

HOAs or Condo Associations

Though you can certainly run into owner associations anywhere, they’re omnipresent in condos. Owner associations often have the power to tell you where to park, make rules about balcony usage, and create other restrictions. You’ll have less power to change outdoor spaces and may have to prescribe to other association rules specific to your building. While a single-family home can be a part of a Homeowners’ Association, in many parts of the country, you can avoid them and make independent decisions.

Lending Terms and Price

When buying a condo, lending terms can be more stringent, requiring inquiries into your finances, especially if you’re putting down less than a 20% down payment. There are often additional condo fees (which aren’t tax deductible) to consider, which add to your total price. You may be able to afford more house with a single-family home than you can with a condo.

Whichever choice you go with, discuss both options with all your partners in the process, including anyone you’re purchasing with, your lender, Realtor, and real estate attorney. These conversations will help you discover which home type is best for your living situation and style.


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