Condo living has many benefits, but the process is decidedly different than purchasing a single-family home. It is important to consider all aspects of condo living before embarking on a condo purchase, which includes understanding the differences between single-family homes and condos.

Condo living is ideal for individuals who seek the security and financial benefits of owning a home, yet want to avoid the upkeep that goes along with a single-family home. However, along with condo ownership come a certain set of responsibilities and challenges:

Homeowners Association Fees

All condo owners must pay homeowner’s association fees, also known as HOA fees. HOA fees are typically paid on a monthly or yearly basis, and they are in addition to any taxes or mortgage payments you make. It is therefore important to not only consider the cost of the condo when purchasing a condo, but the condo fees as well, as they can be quite significant, especially in today’s newer condo buildings.

HOA fees cover a wide array of things, such as building and grounds upkeep, amenities and services, and repair work.

It is important to not only look at the HOA fees, but to also look at the HOA’s history of raising HOA fees for its condo owners, as this could indicate whether your HOA fees will increase dramatically in the years to come.

Expect, of course, to pay larger HOA fees on more upscale condo properties, or those properties that offer a wide array of services and amenities for its residents.

Homeowners Association Restrictions

Along with the benefits of HOA fees, such as building amenities and services, such as swimming pools, business centers and fitness facilities, the purpose of a HOA is to place restrictions on what residents can and cannot do. Although most HOA restrictions are designed to benefit condo owners and property values, you may find that some HOA restrictions don’t fit you or your lifestyle. It is therefore quite important to carefully read the restrictions of the HOA rules and restrictions of any condo in which you are interested.

Loss of Privacy

Although many condo buildings are designed and built in such a manner as to reduce noise from nearby neighbors, you simply won’t be afforded the privacy you would get living in a single-family residence. Make sure you are comfortable with how much public space needs to be shared amongst the residents.

Large Down Payment

Due to the many changes throughout the lending industry as a result of the subprime mortgage crisis, and the fact that many condos severely lost their value during this time period, many lenders are now quite stringent when it comes to lending money to condo buyers.

As a result, you can expect to come to the table with a larger down payment if you want to purchase a condo. Although this amount will differ based on a variety of factors, including the age of the condo building, the vacancy rate and the state where the condo is located, you should seek advice from a lender when considering condo living.