Wednesday, May 10, 2017

Are Condos Costly Or Not At All?

Some people are scared of buying a BGC condo for sale because they often think that buying and living in a condominium is a seriously expensive lifestyle. Is it, or is it all in our heads? The article will shed light on the most common misconceptions about the money involved in buying and maintain a condo. Notably, be reminded that a condo is not the building per se, but the type of ownership. When you buy a condo, you are actually paying for the unit in low-, mid- or high-rise building and the interest in common elements within the building.

Condominium presents itself as an easier way to access the housing market although, sometimes, it depends on the type of condo (luxury condos, for instance). First, DMCI condo ownership is not equal or close to home ownership. In the latter, you are free to change the interiors and its immediate exteriors. In the former, you need to consult the association or board first before making any physical changes.

Since the condo is a communal ownership, you need to pay a monthly association fee for the maintenance of common areas. The fee that unit owners or renters pay is collectively used in maintaining the building. Some of us think of the fees as an additional expense, but it is not. It is a monthly contribution for the building’s upkeep as well as the utilities and some amenities like cable and Wi-Fi. Imagine how much you have to pay if you have to pay for each monthly.

Be wary of condos that require high condo fees because these are indicative of poor financial management on the part of the association. Nonetheless, reasonable is a very subjective term; what’s reasonable for me may be absurd for you. Better ask the condo manager or association a breakdown of the fees, so you’d know what you are actually paying for.

Further, the monthly condo fee that you need to pay change yearly. This is because the board calculates the cost depending on the coming year’s projected cost. If there will be major repairs for the next year, expect higher monthly fees. Nevertheless, the additional amount must be justifiable and appropriate for what the condo building needs.

As a condo owner, you cannot and you should not escape the higher fees because of their impact in the future. If ever you decide to sell your unit, it would be difficult if the common areas are not well-maintained or if the floors and roofs are damaged all because the association has no funds to maintain these areas. This is because of unit owners who aren’t paying their monthly fees. The buyer will ask for a hefty discount which is often higher compared to the cost of the monthly fee and the cost of maintaining such areas. 

Some owners assume that condo fees cover everything. They don't. The entire building has to be maintained as well. So, condo associations schedule a regular assessment of the building to ensure and preserve its structural integrity. If in case, after the assessment, a major repair is required, the condo owners have to contribute for the repair. That is, if the association has no reserve fund for such.

Assessments are not an additional expense as well. These are conducted to ensure that the dwellers are safe and secure. You buy a condo because of convenience, security and amenities. If any of these is threatened, then the value of the building including your unit will decline. That’s how important assessments are.

Evidently, the misconceptions stem from unguided, misinformed expectations specifically about the responsibilities of the condo owners. Not to mention, several poorly managed condo associations eventually lead to more money issues. So, before jumping into buying a condo, make sure that you are 100% financially ready!

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