Ep 154: Condos vs. Single-Family Home – Which Should You Buy?
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A lot of people want to buy a house instead of a condo because they have always thought that condos depreciate. But did you know that condos are now selling faster than single-family homes?
In this episode, David Sidoni is dropping some truth bombs and crushing the confusion around buying a condo vs. a house. The housing market is getting turned upside-down and things are happening in a way that we've never seen before. And whether you’re looking to buy a condo or a single-family house, remember, the goal is to stop renting as soon as possible. Hopefully, this episode will help you in making your plans for 2023.
Here are some power takeaways from today’s conversation:
- Townhomes vs. condos: what’s the difference
- The pros and cons of owning a condo vs. a house
- Why an HOA (homeowners association) is a necessary evil
- Why condos are now selling faster than single-family homes
- Why consider buying a condo right now
[02:31] Condo vs. Townhome vs. House
Legally, there’s no such thing as a townhome, and everything is a condo. But some communities try to get fancy and make themselves stand out by referring to themselves as townhomes. A condo is an individual residential unit within a multi-unit building. Houses, on the other hand, are usually standalone structures separated from the neighboring residences by private property.
[08:04] The Pros and Cons of a Condo
Living in a condo community is a great way to specialize. Condos are more affordable (even with the HOA added to your PITI). This means you can make the purchase sooner since you don't have to save up for the more expensive single-family home. This also means you're going to stop renting sooner, which is the goal, to begin with. Condos also offer more choices due to the low inventory depending on your area. They take up less space than traditional houses, and they’re closer to the more hip, cool urban areas. Condo living affords you a wonderful minimalist life and you may have a common area for your pet friends to hang out with.
On the contrary, condos appreciate lower (which isn’t actually the case right now) and they have a low-maintenance HOA lifestyle. Parking is also usually an issue and some condos may have some pet restrictions.
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[17:41] Why Condos are Now Selling Faster Than Single-Family Homes
Right now, condos are more appealing and selling faster, and higher than homes. Because of the rising mortgage interest rates in the single-family homes that had shot up in pricing in the summer of 2022, condos became the next best thing.
Hence, the myth that condos don't appreciate enough and that they're not good investments has been debunked. We don't know how long this correction is actually going to go. David recommends buying for more than a five or seven-year hold.
[23:06] Why You Should Consider Buying a Condo
Condos are an inexpensive first step toward your forever home as they can help you stop paying your rising rents sooner rather than later. You can save up with a nice fixed payment while you're living there in your brand-new condo and they do appreciate just fine.
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