What is a condominium?
A condominium a.k.a condo is an apartment building where each unit or apartment is Individually owned, according to Cambridge Dictionary. However, all units share the same common area and amenities. Condominiums are owned and managed by homeowner associations also known as HOA for short. The associations take care of condos, enforce regulations, and in return, collect a monthly fee from owners of its units.
Owners of condos can use them as their own residency or rental properties. Many investors do not favor condos because they are small with no room for improvements. In addition, the HOA fee makes it difficult for condos to generate a positive cash flow.
>>MORE: Condo Rental Properties
Benefits of condos
Condominiums are usually small compared to regular homes such as single-family homes. This limitation of space makes condos difficult to live in. The following are some of the disadvantages of condos.
- Limited space
- HOA fee can be very expensive
- There is not enough privacy for its residency
- You can not increase the square footage of your condo
- They are very hard to sell
- They do not appreciate at a fast rate
Advantages of a condominium
Although condos are not the best properties for many people, they have some advantages. The following are some of the benefits of condominiums.
- They are cheap compared to other types of properties
- Owners do not do any maintenance outside of their own space: HOA fee covers maintenance, snow removal, mowing, amenities, etc.
- Condos are sure in many places because people live close to each other and sometimes they are gated
- Easy access and close to the city
- Great for first home buyers
