Have you considered if condo living is right for you? It definitely has its advantages. Condos are usually located in desirable areas and offer amenities such as a swimming pool, gym, and other facilities that you wouldn’t necessarily have as a renter.
Additionally, living in a condo means you have more control over your living space, including being able to decorate and make improvements as you please.
However, there are some drawbacks to consider. Maintenance fees can be expensive and you may have to pay for any repairs that need to be made. Moreover, you may not be able to make the same changes to the outside of the building as you can inside, so it’s worth checking the rules and regulations before committing to a condo.
condominium pros and cons
Living in a condominium has advantages and disadvantages. It’s style, which can differ from traditional apartment-style buildings, can provide a contemporary look. It’s awesome if you’re looking for a place that’s anything but standard. Here are some interesting information about loft-style condominiums.
A bonus is that some condominiums may have high ceilings to accommodate for a loft area. These high ceilings (sometimes cathedral-styled) make the space feel open and spacious. It may also have lots of windows which offers a light and airy setting to enjoy.
If you’re living with others, privacy may be limited if you choose to use the loft area as a bedroom. These are often used as an extra playroom or home office. However, by converting it into a bedroom you are increasing your home’s living space.
Why not get creative? Large pieces of furniture such as an entertainment center or bookcase blocks private areas from view in other living areas, such as the bedroom. If you don’t want to rearrange your furniture, then room dividers are a great alternative. You can get the sliding kind which fit on installed tracks so you can open and close off specific areas when necessary. Another inexpensive privacy option for your loft condo are curtains or fabric panels. However, if you’re willing to make permanent changes to the layout in the name of privacy, a small partition wall or two is your best option to hide your bedroom area from view, depending on your loft’s layout.
If you choose a home with high ceilings, you’ll have extra wall space for decorating. If you have paintings and artwork that you want to display and showcase, a loft condominium provides the right space for them.
If you’re looking for a modern place to call home, condos can be unique and spacious. Visitors are likely to compliment you on your new home. These kinds of units are great if you want stylish surroundings, capturing the attention of your friends and family.
Looking for FHA approved condos?
Before you have your heart set on a certain condo property, check to see if the condominium is FHA-approved by going to HUD’s condominiums database online. To look up a specific condo you’re interested in, you’ll need the condo name. For a broader search, you can also sort by city, state, county or ZIP code.
How to search for FHA approved condos
Check the status of the condo association. If you only want your search results to show condos that are already approved, select “approved” from the pull-down menu. If a project is approved, then it’s eligible for FHA financing. If you don’t limit your search to approved condos, you’ll see information indicating if a project’s approval was rejected, withdrawn or has expired.
Please note that although you can check online, if you’re really interested in buying a certain condo, let your lender know as soon as possible. There is a form that the lender sends to the condo association to verify that the info on HUD’s website is accurate and that the FHA Concentration meets lender guidelines. It would be a pity if you put an offer on a condo and you went all the way through the inspection process only to find out that money was wasted as the condo association is not approved.
When searching for an FHA-approved condo, it is important to keep an eye out for potential red flags that could indicate a problematic investment.
As of this writing, the FHA requires a minimum of 50% owner-occupancy rate in a condo development. If the rate is lower than that, it may indicate a lack of commitment from owners to maintain the property and could potentially lead to declining property values.
Condo Red Flags
Poor financial management: Check the condo association’s financial records to see if they are in good standing. Look for things like late payment of property taxes, ongoing lawsuits, or a high number of special assessments. These may be indicators of financial mismanagement and may impact the value of your investment.
Recent legal issues: Look into the history of the development, including any recent lawsuits or disputes. This can provide insight into potential conflicts or disputes among owners, and could indicate problems with the property management.
High number of delinquent assessments: A high number of delinquent assessments could indicate a lack of commitment from owners to pay their share of the property’s expenses. This could also mean that the condo association is struggling financially and may not be able to maintain the property to FHA standards.
Lack of insurance coverage: Check to see if the condo association has adequate insurance coverage for the building, including liability and property damage. If there is insufficient coverage, you may be responsible for covering the cost of any damages or losses.
Poor property maintenance: Look for signs of poor maintenance, such as broken windows, leaks, or disrepair of common areas. This may be a sign that the property is not being well-maintained, which could lead to problems down the line.
Proximity to undesirable elements: Consider the location of the property and any potential problems that could be nearby, such as airports, highways, or high-crime areas.
What are the pros?
Lower down payment: FHA-approved condos often require a lower down payment, making it easier for some people to become homeowners.
Flexible credit requirements: FHA loans have more relaxed credit requirements, making it easier for people with lower credit scores to qualify for a loan.
Lower mortgage insurance premiums: FHA loans may have lower mortgage insurance premiums compared to conventional loans, which may result in lower monthly payments.
What are the cons?
Limited condo choices: Only certain condos are approved for FHA financing, which may limit your options when looking for a home.
Stricter appraisal standards: FHA appraisals are stricter and may be more expensive than conventional appraisals.
Fees and mortgage insurance: While the mortgage insurance premiums for FHA loans may be lower, there are still upfront and annual mortgage insurance fees that must be paid.
Decide if a condo is right for you
In conclusion, when it comes down to it, the decision to live in a condominium depends on your preference. It’s important to do your homework when searching for an FHA-approved condo, and be aware of potential red flags that could reveal if it would be a good or bad investment.
By being proactive, you can ensure that you find a property that meets your needs and will be a place to enjoy for years to come.