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Home Buying Condominiums
Depending on who you talk to about buying a home, some will tell you that a condominium is an excellent purchase while others will tell you to avoid buying a condominium. In truth, condominiums are an excellent option for entering the housing market if the purchase of a home is too financially stressful. Additionally, some people appreciate the lifestyle of owning a condominium in that there is no yardwork and the exterior is maintained by the association and not you!

If you are a first time homeowner but finding that your money is not stretching as far as you would like, you should think about buying a condominium. Interestingly enough, when you buy a condominium, you do not actually own the unit itself or the piece of land, or the lot where it sits. What you do own is the space within the walls and anything from ceiling to floor. In contrast, a townhouse is where you would own the unit as well as the lot. Although owning a condominium has strict guidelines about painting the outside, adding on a room, or changing out the landscaping, it is easier to afford for many people.

When you buy a condo you are also joining a homeowners' association which is responsible for the maintenance of the units, insurance, garbage and outdoors areas. The monthly HOA fees may seem high at first, but owning a home will have similar costs over a same period of time.

What to Consider when Buying a Condominium.Ask owners in the complex what they like and dislike about both the unit and the complex. How good is the sound proofing? End units and upper units generally sell for more when sound comes into play. How is its location in the complex. Next to an access street, parking facility, pool? Look for units that are not adversely affected by these.

Stay away from predominantly rental condo complexes, those having more occupants that are renters. They are often poorly maintained as absentee owners usually vote against improvements and increases in maintenance fees. Many lenders will not make loans if the percentage of renters is high compared with owner-occupants.

Compare monthly association fees with other similar condo complexes and what amenities are included. Find out if any increases in fees or special assessments are planned. Is the condo homeowners' association in good financial condition. Before making a purchase offer, obtain the latest financial statement from the homeowners' association. Are there any lawsuits between the homeowner association and the builder? Who manages the complex and how well are the common areas maintained. Check to see if there are any unusual bylaws, rules or CC&Rs. A good complex generally is a result of restrictions of pets and rentals. Read all papers carefully.

Buying in a New Complex. Find out how many units are sold and closed. Don't be one of the first buyers. Its better to have 60% of the condos sold before you close your purchase. If the units don't sell or the developer goes bankrupt, you may end up owning much less. Make sure a warranty is provided for one year on everything in the unit. It is important to know exactly what your developer will warrant when buying in a new complex.

How do Condos Compare to Single-Family Homes? Based on appreciation, condominiums in some areas have been as profitable an investment as single-family homes in the last five years. In some markets, condos appreciated even more, according to Dataquick, a Southern California firm that tracks home sales prices statewide. Problems with Condominium Associations, are Condos a Bad Investment?

Despite problems in many associations, condominiums have done a good job of holding their value. Real estate experts say that the reason there are more stories about conflicts in associations is the proliferation of homeowners' associations. Currently, there are an estimated 25,000 in the State of California alone. Condominium associations involved in lengthy and expensive litigation may find that such disputes will hurt resales because some lenders are reluctant to make home loans on units in their projects. However, experts argue that many disputes today are resolved more readily without initiating legal action. In addition, the condominium community has worked hard in the last few years to overcome image problems that were brought on by disputes and lawsuits among condo owners and developers. Associations today are becoming more sophisticated about property management and are taking steps to prevent legal problems and disputes. Buying a condominium is still an excellent way to start home ownership.

To find condos listed on the internet, start at the Best Listing Sites.

If you want condo listings emailed to you in the Morgan Hill, Gilroy, Hollister area: Sign up on my Listing Alert system

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