What are condominiums?
A condominium is not a specific kind of home, but rather a specific kind of ownership. Condominiums can be townhouses, high-rise flats, or even detached houses. Instead of owning a piece of land outright, as with freehold condo ownership, condo owners own a space, called a unit, in the condo structure. Each unit is defined by the Condominium Declaration, which is a legal document that describes the condo development in detail and allocates a strictly defined space to each owner. This space usually includes the interiors of the unit (flat or townhouse), down to the drywall or plaster, and in some cases includes public areas like a foyer, interior hallways, party rooms, and gym facilities.
Who runs the condominium development?
Every condo development is run by a board of directors composed of elected condo owners. The board is responsible for maintaining condo development. The condo corporation is required by law to establish and maintain a reserve fund, which is a fund set aside for major scheduled maintenance or unexpected repairs. The corporation also collects the monthly common fees from owners to cover the costs of property taxes and insurance.
How is condominium and home ownership different?
The main difference is that condo owners must pay monthly common fees, which cover the cost of insuring and maintaining the condo development. Common fees are in addition to paying the costs of financing the condo purchase and vary with the percentage of the total developed space occupied by an owner’s unit. In a very simple development with above ground parking, no common party rooms or guest suites, and basic gym facilities, common fees may be minimal. However, in a well-appointed (think underground, heated parking areas) or older development, common fees will be higher, as will the maintenance fees they cover.
Who do condominiums appeal to?
Condos appeal to a wide variety of homeowners – busy young professionals who don’t have the time to cut the lawn, tend a garden or shovel a driveway, people who travel frequently and can’t always attend to the demands of a house, and retired people who may not be able to physically attend to a large home.
What determines the value of condominiums?
As with any other real estate, the value is ultimately determined by the buyer. These are some factors that will affect real estate value: location, exterior and interior structure, location within the building if it’s a multi-unit structure, view and closeness to the top floor, and parking.
What are the most important elements to look at when buying a condo?
First, consider whether you will be really happy living in a condo, and particularly in the condo in question. Spend some time in the building, walk around the building, visit local businesses and hangouts, and walk around the neighborhood. Make sure you receive and review condo documents. Get copies of the minutes of board meetings so you can see what the issues are and if common fees will be increasing. Talk to some residents to get their opinion on the management and lifestyle.