When considering whether to buy a new house, condo or townhome, there are many factors at play. What’s right for you will depend on many things, including your stage in life, budget, and lifestyle. Here are some of the biggest advantages to buying small, in particular.
Cost is a major benefit to buying a condominium or townhome, as they are smaller and are often less expensive to purchase than a full-sized house. There are ongoing financial advantages, too. With condos and townhomes, a homeowner’s association, or HOA, is financially responsible for repairs and upkeep.
Teris Pantazes is a licensed contractor and co-founder of the online homeowner and handyman community www.efynch.com. Pantazes says that to cover the costs of home repairs such as HVAC system maintenance, roof work, driveway sealing and emergency repairs, an owner of a full-size house may need to set aside as much as 25 percent of their mortgage payment each month.
Depending on your mortgage payment amount, this may be comparable to the monthly HOA fees, which average between $200 - $400 per month. However, the HOA payment covers a lot more than just potential maintenance and upkeep. In general, HOA fees may also cover city services, lawn care, pest control, and insurance.
With a condo or townhome, you’ll pay a monthly fee to the HOA so that when problems arise, the HOA takes care of the emergency. The simplicity and ease this maintenance model provides can be great for first-time buyers and retirees.
In addition to peace of mind when it comes to emergency repairs and ongoing maintenance, buying a condo or townhome alleviates the burden of yard work and landscaping. You also won’t have to worry about snow removal or cleaning the pool.
The purchase of a new townhome or a condo could mean access to extra amenities. Oftentimes these communities will have a swimming pool, spa, fitness center, covered parking, common areas, and gated security.
For many younger buyers, these features would be unattainable when buying a single-family home. Retired empty nesters may also love being able enjoy the maintenance-free pool with their grandchildren.
Security and Sense of Community
For any homebuyer, the added security associated with townhomes and condos is an attractive feature. Such properties are often located in safe, modern areas protected by a gated entry or security guard.
Another plus to purchasing a condo or townhome is a sense of community, especially if you're new to the area or living alone. It’s easy to meet neighbors through community events, in the gym or gathered around the pool.
More Freedom, Plus Equity
Kevin Deselms, a Realtor with RE/MAX Alliance in Golden, Colo. says owning a condo is very similar to renting an apartment, except that the owner has the freedom to modify their unit as much as they like, as long as it’s within the written standards set forth by the community.
Unlike renting, however, the buyer builds equity with their investment. Deselms says this equity comes in handy when it’s time to purchase a larger home in the future. Therefore, it makes a great stopgap solution for the first-time homebuyer who is still preparing for the added costs and responsibilities of a single-family home.
So while you might be dreaming of a house with a garden and a white picket fence, there are plenty of reasons to think and live smaller – at least for a little while.