Things to consider when buying a condo

Condominiums have become a popular form of ownership, especially among first-time homebuyers. Not only do condominiums tend to be the most affordable option for homeownership in downtown Toronto, they also offer a low-maintenance lifestyle.

What is a condo anyway and what should be considered when buying one?

The term condominium actually refers to a type of property and not the style of construction as many people think. This type of ownership allows the owner to own a specific unit in a building, as well as own a portion of the common property, such as the lobby, hallways, gym, recreational facilities, etc.

Condominiums offer owners many advantages over a freehold property, such as affordability and a low-maintenance lifestyle. A monthly fee, known as a maintenance fee, is paid to the condominium corporation each month to cover construction costs such as grounds maintenance and sometimes utility bills for your unit. Each month a part of this maintenance fee is contributed to the condominium reserve fund. A reserve fund is set aside to pay for any major repairs that need to be addressed in the future, such as repairing the roof or pool.

Deciding to buy a condo, especially for a first time buyer, can be a stressful and unfamiliar process. Let’s take a look at what to consider when purchasing a condo unit.

1) Price – How much can you afford and what is included in the unit price? Are utilities extra? Does the unit come with a parking space or a locker? If so, do they have an additional cost?
2) Down Payment – ​​Consider how much you can afford to pay down. Any amount less than 20% of the purchase price must obtain mortgage insurance. The higher your down payment, the less interest you’ll pay over the life of your mortgage. 3) Location – Is the location convenient for your lifestyle? Is it close to your workplace, the gym, public transportation, shopping, the highway, etc.?
4) Suite and floor plan – Is the layout practical and will it be easy to arrange furniture? What part of the floor is it in? Next to a noisy garbage chute or in front of high-traffic elevators?
5) Common Areas and Building Amenities – Does the building have the amenities you are looking for, such as a fitness center, recreation room, guest suites, pool, etc.?
6) Future value – Is the building and location a good investment? Is the area booming?
7) Reserve Fund and Condominium Corporation – Your attorney will review the state certificate to see if there are any upcoming costs or increased scheduled maintenance fees.

Condominiums are a great alternative to freehold living if you’re looking for affordable and convenient living. When searching for your perfect condo, keep the above in mind. Happy condo hunting.