By Alan Jones, Espresso
Buying a condo can be a good idea for many reasons, whether you want to own property for yourself or you just want to make an investment. However, there are condos out there that are not good investments and not good places to live.
What is the developer’s track record?
A good developer will have a solid track record of producing good-quality buildings that rise in value over the years, while a bad developer might leave behind a string of horror stories. Urban-centric publications like Curbed often have stories about “shady” developers, which are only a Google search away.
Is it a good location?
When the real estate market is hot, developers will put condos wherever they can fit them, but that doesn’t mean you shouldn’t be paying attention. A good condo will be close to groceries, stores and transit, while a bad one will make it a hassle every time you leave the apartment.
Do you think you’ll make a profit?
Try to find a condo that will still retain its value down the road, regardless of market realities. Of course, you can’t avoid the realities of the marketplace, but according to the experts at Bankrate, properties that retain their value over the years are the ones that are located in good neighbourhoods.
Do you need to be a property owner?
According to CNBC, buying property is not as good of an investment as your parents may have told you. If you’re eager to become a homeowner because you feel like it’s what you’re supposed to do, look into the long-term benefits of owning property and consider renting for a little while longer if they don’t match your expectations.
Do you know what you’ll owe in taxes?
Most property owners pay into local property taxes, but new condo owners in a city like Toronto, for example, have to pay a speculation fee if they’re looking to purchase a condo without being its resident. Depending on your situation, make sure you know your tax liabilities.
Will your view soon be obstructed?
Before you buy a new condo, take a look at what’s planned for the surrounding area, and find out if your beautiful view is about to be blocked by a new building. Developers are often required to consult with communities before they build, so you should be able to find out what’s planned for that empty lot across the street.
Have you done your research?
This might sound like a no-brainer, but new homeowners often don’t know as much about the local market as they should. Finding out more about a prospective neighbourhood can be as easy as a Google search. Websites like City-Data offer a lot of information about different areas and sometimes include forums where you can ask specific questions.
Why are you getting a deal?
If sales are slow, some realtors and condos are going to offer incentives to buyers. The Huffington Post has even reported on condos that provide new buyers with a free car. Beware these deals, as they can sometimes disguise a bigger problem with the condo. Do your due diligence and make sure you’re not getting fleeced.
Have there been issues with the neighbours?
Neighbourhood activists, such as the ones profiled here by The Charlotte Observer, often fight against condominium developments because they perceive new developments as a form of gentrification. You’re going to want a condo built by developers that respect these attitudes, rather than trying to cash in on an up-and-coming neighbourhood at its residents’ expense.
Is it too good to be true?
If a new condo seems too good to be true, that’s because it probably is, especially if you’re basing your purchase on a showroom. Newspapers are chock full of stories about condo owners suing developers, and The New York Times reports that these lawsuits often occur during downturns in the market, when developers cut corners to keep costs down.
What are the condo fees?
Sometimes, new condo owners are unprepared for the high condo fees of the building they’ve moved into. According to MarketWatch, high condo fees can be a sign of low property values and poor maintenance. It’s not just that they hurt the wallet—high condo fees can also impact resale value.
How are the schools?
Young families are eschewing the suburban lifestyle to raise their family in urban condo units, according to The Toronto Star. If this is the case for you, check out the schools nearby and make sure they’re going to be a good match for your children. If possible, you’ll probably want to avoid spending a fortune on private schools.
What are the amenities?
No one should base their decision to purchase a condo on the amenities, but it does make sense to consider whether or not you’re going to use them. An on-site weight room, for example, can save you the monthly expense of a gym membership, while a recreation room might come in handy for anyone leading an eventful social life.
Elevator wait times
If there aren’t enough elevators in your building, or if they’re frequently out of service, you can spend a significant amount of time waiting or taking the stairs. Elevator problems can also impact property values, and the website AddressReport can help you research elevator issues before making an offer.
Is it loud?
Before you put money down on a new condo, you should spend some time finding out who your neighbours might be. If you expect a quiet, respectful atmosphere, then it might be best to avoid a condo building populated by young people who often have friends over. Even if you’re OK with the noise, The Seattle Times reports that noisy neighbours can affect property values.
Is it energy-efficient?
Before you buy a new condo, check out how much sunlight it gets, how much insulation it has from the outside, and whether or not it’s hooked up to an efficient central air conditioner. According to Realtor.com, the U.S. Department of Energy says that you can save up to $465 a year with double-paned windows alone.
Look beyond the square footage—does the layout suit your needs?
Condo prices are often based on square footage, but sometimes that’s less important than how the space is used. Are the bedrooms big enough? Is the bathroom cramped? Do you have enough room to move around the kitchen? According to an expert at The Balance, bad layouts will also make your home harder to sell.
What are the condo rules?
You may “own” your unit, but condo boards have different rules about what you can do with your property. According to The Washington Post, many condo boards now have rules against renting your apartment on Airbnb or other short-term rental services, which could impact any plans to make extra income off your property.
Are there many absentee owners?
Before settling on a condo, make sure there aren’t a lot of absentee owners. Community is important to people, and many prospective buyers don’t want to live in a “ghost” building. If possible, knock on a few doors and make sure your neighbours are people you will want to live beside for the next few years of your life.
