The experience of buying a condo for the first time is similar to buying your first house. If you're looking for your first home and you aren't ready to buy a detached house, start with a condo. There is less hassle, and you can even qualify for financing faster.
Ready to get started? Here are nine tips to help you buy your first condo.
1. Get Pre-Approved For Financing
Getting a preapproval is the first step. You should speak to lenders even before you start looking for a condo. That way, you will know what kind of loan you qualify for and how much so that you can start looking for a condo within that price.
Sometimes, you may even find that you do not qualify for a loan. Compare rates and payment conditions from different housing loan providers.
2. Stick To A Budget
Make a comprehensive budget and stick to it. Every home, even a condo, comes with maintenance requirements. Don't forget cosmetic changes you may want to make, like painting. Every month, there will be HOA fees to pay. You should factor them in the calculations, too.
Other things like paying your insurance premiums, car financing, and utility bills still have to be taken care of. This is why you should come up with a budget and be determined to stick by it. After you find a condo that you genuinely love, you might be tempted to make a big offer so that you get it, but emotions should never drive a condo-buying process. Numbers should drive it.
3. Get Help From A Real Estate Agent
A real estate agent will cost you money, but you will consider it money well spent. After all, they will give you great advice and help you get you the property that you want much faster. For example, if there are newer condominiums in the area, the older ones might lack many customers so they would sell at a considerably lower price. Follow the advice of your real estate agent (but listen to your heart, too).
4. Wait For A Buyer’s Market
Market trends change from seller’s market to buyer’s market. In the buyer’s market, it means the supply of condos is higher than the demand. Therefore, you have an advantage. Use your position to bargain!
5. Pay Attention To Location
You know what they say: location, location, location. And there are many reasons why location is so important. One of the reasons is that in the future, you will want to sell the condo and move. If that will be the case, you will want the condo to fetch you the best price possible, and location will help.
Resale value is not the only consideration. There are other things to look out for such as proximity to the road, grocery stores, hospitals, and other amenities.
6. Attend the Open House
After your real estate agent has helped you narrow down your choices, it is time to go and view the houses. You need to know when the open house for each property is scheduled. When you go there, pay close attention to every room in the home and take notes of the main strengths and weaknesses of the condo. After you have viewed all the condos you were interested in, you can sit down and compare notes.
7. Know The HOA Fees
One of the reasons many people fear buying condos is the Homeowners' Association (HOA) fees. HOA fees vary from one condo complex to another, and depends on how many services and amenities are offered. If the grass is cut for you, exterior repaired for you, you enjoy the recreation facilities such as the swimming pool…it is only fair that you pay. The payment for these facilities is in the form of HOA fees. Be aware, because some of the condo neighborhoods can have high fees.
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8. Make An Offer
After you are convinced that you have found an excellent condo, make an offer! Of course, your offer will be guided by the listed sale price. You should usually start lower than the asking price, but it should also be a reasonable offer. Do not make your offer too low or the seller will think you are not a serious buyer. At the same time, you do not want to buy the condo at too high a price. You must find a balance. Your real estate agent will help guide you.
At this juncture, you can bring up any cons that you noted about the condo. For example, if you noticed a need for repairs, you can use that to bring down the price.
9. Consider The Counter Offer Carefully
Once you have made an offer, the seller will make you a counteroffer. Consider it seriously to see if the seller might budge. If the counteroffer is close to the offer that you had made, the seller is willing to concede some ground. Even if the counteroffer shows that the seller is not willing to compromise, you can go ahead and ask them whether they will give way in the processing and closing fees. If they are willing, you can go ahead and close the sale.
It is always a good idea to know the ins and outs of anything you are spending a lot of money on. Buying a condo for the first time is a big deal, and you should be extra careful and well-prepared. I hope the tips mentioned above will make your first time buying a condo easier.