Are you conflicted between buying a condo or renting an apartment? Choosing one over the other presents a very different type of lifestyle and it may be difficult to even know what the difference is between a condo and an apartment. So, which is better for your living situation? Let’s take a look at the differences to help you figure out which works better for you: a condo or an apartment?
What is a condo? A condo, also known as a condominium, is a private residence purchased by an individual homeowner or family in a building or community with several units. Although condos are usually part of a larger building, detached condos also exist. They can vary in size or style and often share walls with adjoining units. Residents own and can maintain the interior of their condo unit, which means you can do what you want with any home improvements that may be needed! Keep in mind, you can either rent or own a condo, so home improvements can only be done if you’re the sole owner.
What is an apartment? An apartment is a rental property that is normally owned by a property management company, located in a residential building, complex, or community. In an apartment building or complex, all units are similar, the owner is the same, and all the occupants follow the same protocols and rules for renting the units. When living in an apartment, keep in mind that you can only rent and you won’t be able to do any home improvements whenever you want, like you can with owning a condo.
Build Equity? Home equity is the portion of the home that a person truly owns. It can increase over time if the property value increases or the mortgage loan balance is paid down. Home Equity is often a homeowner’s most valuable asset. It can be used later in life, so it’s important to understand how it work. So how can you build equity in a condo?
When you buy a condo, you could potentially build equity overtime. If the condo you’re purchasing is a starter home, you may be able to build equity that can be used as a down payment on your next home. With a condo, a down payment may be required whereas with an apartment, no down payment is required and your upfront costs to rent are usually lower than buying. A condo could be an affordable way to get out of renting and begin building equity.
Rules for a condo and an apartment? The rules for each are different and determined by the owner. For an apartment, the property management company implements the rules and those same rules apply to all the units. The property management company also chooses when the interior of the units gets remodeled. The rules for a condo are set by the Home Owners Association (HOA) and this applies to the outside areas of the units, however, the interior of your condo can be remodeled when you would like if you’re the owner. The rules set by the HOA includes fees which help pay for the upkeep of common areas and building exteriors.
Costs and maintenance: Is a condo more costly than an apartment? A condo may not cost you more than renting an apartment. If a condo and an apartment are in the same part of town, with similar square footage, chances are their monthly costs may be around the same. The upfront costs to purchase may be higher than a rental situation, but any repairs needed in an apartment will not be the tenant’s responsibility. With a condo, you’re liable for the maintenance of the unit verses having a property management company in charge of any maintenance. With an HOA, it will cover the areas such as the shared amenities and the building itself, but they do not fix a leaky sink. If you are renting an apartment, the complex offers maintenance and you are not responsible for the repairs.
Do you like keeping up with the latest design trends or having an updated kitchen or bathroom? A condo may be the right choice for you, so you can decorate the way you want. Do you not want to worry about home improvements or any repairs? Consider an apartment rather than owning a condo.
Knowing your preferences and your needs can help you find the right option and accomplish your dream of being a homeowner.