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Buying a condo? What you need to know

Buying a condo? What you need to know

Rachel Mendelson
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When you’re ready to buy a home, you’ve got a few decisions to make. Pretty early in your home search process, you’ll need to decide what type of home you want—a single-family house, townhouse, or condo. Each type of home has their pros and cons, as well as guidelines about what kind of mortgage loan you can get based on property type.


So, you’re thinking a condo is right for you? Great! Let’s talk about condos and what you can expect.


The property is considered a condominium (a.k.a. condo) when there are privately owned parts of the building and common areas that are owned collectively. Generally, as a condo owner, you own from the building’s studs, in. That means you have complete control over the inside of the condo.

The “common areas”—typically from the studs out—usually includes things like the building’s roof, any landscaping, and the parking lots. These spaces are owned by condo residents as a whole and are typically maintained and paid for by the condo association. In this way, condos allow you to own your home without all of the responsibilities of a single-family home. However, that sometimes comes at a price. In most cases, you, as a condo owner, may pay dues to the condo association every month, which goes into a fund that helps them manage the properties. Don’t worry, we’ll talk more about condo fees.


We mentioned condo fees above, but let’s talk about them. Since the condo association generally takes care of the studs out, they charge each condo owner fees. These range between condo associations and can be substantial. If there’s a pool, clubhouse or gym, the condo fees also go toward maintaining them, as well, and, as a result, may be a little higher than a condo without those amenities.

Almost every condo is going to have condo fees — it’s rare to find one that doesn’t — so make sure you ask about them when you’re condo shopping.


House-shopping for a condo is basically the same process as shopping for anything else. You’ll want to find knowledgeable and experienced real estate and mortgage professionals to help you find the right home and mortgage loan option for you. They’ll also be your go-to sources for any and all industry and home buying process questions.

Tip: When you’ve decided to buy a condo, make sure you talk with your mortgage banker about your loan options. Sometimes, loan requirements are stricter for condos and every loan program has different rules.

The tasks that need to be completed throughout the home buying process will be split between you, your real estate agent, mortgage banker, and a few other key players.


When you’re shopping for a condo, you should ask some specific questions that you might not ask for any other property type:

  • What are the condo fees? Like we said above, it’s unlikely you’ll find a condo that doesn’t have condo fees. Find out how much these fees are, when they’re due and how they’re collected every month.
  • Are there cash reserves? Most condo associations have cash reserves in case a big project comes up. The lower their cash reserves, the older the condos, usually. What if they need to replace the decking on every unit? What if they need to redo the all of the parking lots? If there isn’t a decent reserve budget, you could end up paying a lot out of pocket.
  • Do most owners live in their condo or rent it out? Keep in mind that certain mortgage loans have restrictions with condo associations on the amount of units that are owner occupied versus renter occupied.

For more homeownership and home buying tips and tricks, head over to the Atlantic Bay blog.