The True Cost of Condo Ownership: What Buyers Need to Know
Buying a condo can be an attractive alternative to a single-family home, especially in competitive markets. Lower maintenance, access to amenities, and a more affordable entry price can make condos seem like a great deal. But before you sign on the dotted line, it’s important to understand the hidden costs that come with condo ownership.
Beyond the Purchase Price: The Real Costs of a Condo
When buyers look at condos, they often focus on the sticker price—but that’s only part of the equation. Monthly expenses, special assessments, and association management can all have a significant impact on your long-term costs.
HOA Fees: The Recurring Cost You Can’t Ignore
Homeowners Association (HOA) fees are a mandatory part of condo living. These fees cover things like building maintenance, landscaping, amenities (like pools and gyms), and even utilities in some cases.
💰 Typical HOA fees range from $400 to over $1,000 per month, depending on location and amenities.
While a well-managed HOA can ensure a beautiful, well-maintained property, high fees can eat into your budget. And unlike a fixed-rate mortgage, HOA fees can and do increase over time.
Special Assessments: The Unexpected Bill That Can Hit Hard
HOA fees don’t always cover big-ticket repairs, like replacing a roof or upgrading an elevator. When there isn’t enough money in the HOA’s reserve fund, special assessments are levied on condo owners to cover the costs.
🚨 These assessments can range from $5,000 to over $20,000 per unit—sometimes even higher.
In poorly managed buildings, special assessments can happen frequently due to lack of planning or ongoing maintenance issues.
Poorly Managed HOAs: A Hidden Dealbreaker
Not all HOAs are created equal. In fact, 22% of condo sales are impacted by poorly managed associations, leading to issues such as:
Deferred maintenance that lowers property values
Financial mismanagement resulting in sudden fee hikes
Conflict among homeowners, making it harder to sell in the future
Before buying a condo, always review the HOA’s financials, check for pending lawsuits, and ask about recent assessments. A well-run HOA can protect your investment—while a bad one can turn your dream condo into a financial headache.
Is a Condo Still a Good Investment?
For many buyers, condos are still a smart choice—but only if you go in with eyes wide open. If you’re considering condo ownership, make sure you:
✔ Understand the HOA fees and what they cover
✔ Check the HOA’s financial reserves to avoid frequent special assessments
✔ Review recent meeting notes to spot potential red flags
✔ Consider resale value—poorly managed condos can be harder to sell
With the right research, a condo can still be a great home and investment. But don’t let hidden costs take you by surprise!
🏡 Thinking about buying a condo? I can help you navigate the market and find the best deals. Contact me at lisa@lisamlum.com for expert advice! 📩