In many urban centers a condo can be more affordable than a single family home, however, in the Kansas City, MO/Kansas City, KS area that is not the case. Dollars per square foot are a lot more reasonable in the Kansas City Metro Area than other major cities such as Chicago, Denver, Boston, or Portland. Condos and single family homes are about the same price here so it is the lifestyle that is the draw more so than pure dollars and cents. Fortunately, due to the recent passing of the Housing Opportunity Through Modernization Act the affordability factor comes more into play. Condos were not (usually) previously covered by government backed loans, like the FHA loan which is a plus for those with not great credit nor the funds for a standard 10-20% down payment, with this new legislation you can now get an FHA loan for a condo where you can put down as little as 3.5%.
Condo’s can me more appealing than a single family home to those that are not interested in maintaining a home’s exterior or it’s lawn. No painting, weeding, or mowing required! However, you do have to pay HOA fees in addition to your mortgage for that convenience. However, your HOA fees also cover amenities. Condos come with not only doormen but also fitness centers, storage units, pools, and roof decks just to name a few. These common areas can also be a great way to connect with your neighbors and make new friends. Condo’s also tend to be in more urban parts of town which is appealing to those who enjoy living in more convenient neighborhoods close to public transit, shopping, dining, nitelife, and cultural events all within walking distance as apposed to a sprawling subdivision a 30 minute drive away from downtown. However, like a single family home you still get to write-off your mortgage interest, any points on your mortgage, property taxes, and private mortgage insurance.
Some downsides to condo ownership are that you don’t own the land which appreciates faster than your home so condos appreciate at a slower rate than single family homes. You have to pay the HOA fees even if you don’t use the offered amenities and they are not tax deductible. In addition, you may have to pay assessments as well. Here is an explanation of assessment fees from US News, “Every month, a portion of your condo fees goes into the development’s reserves. That’s where the condo association gets the money to fund occasional projects, such as repainting the building’s exterior. If an expense can’t be delayed – let’s say a pipe burst and there isn’t enough in the reserve to cover repairs – condo owners could be asked to pay an assessment, which can range from a minor pittance to thousands of dollars.”Lastly they can be noisier as you must share at least one common wall with your neighbor, if you’re seeking a large lawn and peace and quiet then condo life is probably not a good choice for you, but if you like the hustle bustle of a lock-and-leave lifestyle it just may be the perfect fit.