Buying a condominium can be an exciting experience. In some cases, it’s getting something for your money rather than forking over rent to a landlord. For others, it’s a sense of freedom. It could be as simple as moving out of the family home. And, of course, condominium purchases can be excellent investment opportunities.
Meanwhile, condo purchases are somewhat different than buying one or multiple family homes. Notably, the New Jersey Statutes have an entire section devoted to condominium law, which starts with naming the New Jersey Condominium Act.
If you’re thinking about buying a condo, it’s crucial that you at least understand some basic premises. What follows are some significant considerations.
One: Condominiums are Different than Cooperatives
Truth be told, you don’t hear about a whole lot of coops available for sale in Union County. However, they do exist. There’s at least one in Elizabeth, and another in Westfield. Therefore, you should understand the differences between condominiums and cooperatives.
The most important distinction is that a condominium involves the actual purchase of real property. When you invest in a coop, a corporation owns the building. You are essentially making an investment that equates to stock ownership.
Since a company owns a cooperative, it may be up to a board to determine if you can even buy into the premises. Sometimes, you may also find it more difficult to obtain financing for a coop.
In the meantime, buying a condo does not involve the same restrictions. You own the space from the outside walls in. Meanwhile, you have the benefit of sharing common areas, which almost always include monthly fees.
Two: Homeowners Association Fees and Condominiums
For the most part, buying a condominium means that you will need to pay homeowner association fees (HOA fees). This may be a deal breaker for you if you equate HOA fees with paying rent on property you know. However, you should think again.
First, there are benefits to homeowner associations. On the one hand, you won’t have to worry about shoveling out your driveway. Your landscaping costs are also included. As an added bonus, your heat and hot water may be included in your HOA assessment. (This is particularly true in the case of garden apartments converted to condos.)
In some cases, homeowner association agreements provide community access to indoor and/or outdoor recreational activities. You may enjoy the luxury of a swimming pool or basketball court. Depending on the number of amenities, HOA fees vary.
However, there’s another important consideration. If you own a private home and the roof leaks, the repairs or replacement are all on you. When it comes to a condominium, the association needs to come up with the cash. Of course, that may mean an increase in HOA fees.
Three: Restrictions on Condominium Ownership
Your HOA agreement may include some restrictions. For example, you could be limited as far as pet ownership. Can someone actually insist that you have only one animal in your home? Or, restrict you to a particular type of pet?
The truth is that the homeowners association may vote on all kinds of things and include them in the agreement. For example, you might be restricted to only one animal. Some HOA agreements even contain language about visitors bringing pets into your household for temporary stays.
You might be surprised. In some cases, the restrictions are seemingly intrusive. The fact that dark wall treatments match your décor won’t work if the condo association insists on neutral ones facing the outside windows. Obviously, checking your HOA agreement makes sense in advance of your purchase.
Thinking of Buying a Condo?
Making any type of real estate investment can be stressful. Have questions? Contact Lawrence M. Centanni for legal advice concerning the purchase of your condo. We look forward to providing you with assistance this exciting time!