3 Surprising Costs of Owning a Condo
Purchasing a condo could be a good option for many homeowners especially in towns like Ocean City Maryland. A condo can come with less maintenance and work or it could come with a better view and a nice list of amenities. And often a condo comes at a lesser price than a comparable single-family home.
When considering to purchase a condo it is a good idea to understand all of the surprise costs that could pop up as expenses associated with condo ownership. Here are some of the most unexpected costs that condo buyers face.
High Condo Association Fees
It is very rare to find a condo that does not have a condo association fee attached. The condo association or board is in charge of managing and or looking after all of the care and maintenance for the common areas within the condo community. The way that this upkeep is paid for is through association fees paid by every condo owner living in the community.
These common areas can include the lobby, courtyards and patios, amenities like swimming pools and elevators, and landscaping. In some communities, it can even include utilities as well as garbage pick-up.
It is always within a condo buyers’ best interest to make sure they are well aware of the complete cost of all condo association fees. In some cases, condo fees can be several hundred dollars extra monthly on top of your monthly mortgage. Failure to pay association fees could end up with a lien placed on your house and could even end in the association foreclosing on your property to retain back-owed dues.
In addition to checking out the price of your condo fees, you want to make sure that the financial status of the condo association is healthy. Every condo association should have a good amount of reserve funds in order to make major repairs or cover the cost of any emergency expenses.
In some condo communities, there is a mismanagement of funds and these reserve areas can run dry. If the association is in need of replenishing a reserve or if they are in need of more money than regular dues and reserves provide, a levy of a special assessment can take place. This can mean a large expense that was not planned for on the part of condo owners.
It is a good idea to have your own emergency fund set aside when living within a condo to cover any unexpected enormous expenses that might pop up for the community that goes beyond the reserve.
Extra insurance required
If a condo community is within a flood or storm-prone area the association provides insurance to the common areas of the building but does not cover anything within your personal condo unit walls.
It is always a smart idea to invest in condo insurance to protect the personal belongings within your condo and anything inside your condo unit walls that might need repair as the insurance you pay with your condo dues will not cover this. Not having the correct insurance could mean a large out-of-pocket cost to a condo owner.
It Is a very smart idea to get condo insurance quotes from a few different companies for the particular condo you are interested in before submitting an offer on a condo. You want to make sure that this is an added cost that you can afford in addition to your monthly mortgage and your condo association dues.
For more information on purchasing a condo in Ocean City Maryland or other surrounding areas including West Ocean City real estate, please contact us anytime.
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