Buying A Condo: 10 Things You Must Know Before You Buy
Ten Things You Must Ask Before Buying your Luxury Condo
Searching for your luxury condo in is exciting. But, you may also have some questions or concerns about condo living. This section will answer your questions and help you conduct your condo search with confidence and knowledge. If there’s something on your mind that you don’t find here, please feel free to email or call me.
1.) How can I be sure I’m getting the best price for the condo I want?
When you find a unit that you are interested in, I will provide comprehensive market information about other units in the same building that have sold recently. You will also have access to market activity reports about the entire area with detailed information about the various neighborhoods.
2.) What’s the difference between a foreclosure and a short sale? How can I buy one?
- Foreclosure: (or bank owned), is one that has been taken over and put up for sale by the mortgage holder. To make an offer, you must submit proof of funds, deposit, and completely filled out contract in order to get a response. The process is very rigid and corporate, but great discounts are available and this can be purchased immediately with quick closing.
- A short sale is when the owner of a property offers it for sale at less than the value of the mortgage. To buy a short sale, you have to make an offer, and then the mortgage holder has to approve the discount. This process typically takes 3-6 months.
- As a member of the Prestige Buyer Program you’ll have the opportunity to see these properties before they are available to the general public.
3.) How can I learn if a condo association is financially stable?
You are smart to be concerned about the financial workings of the different condo associations. Neither the seller nor the association will release any Association Documents to you until you are under contract with a deposit. We have long term relationships with building managers, and when you join our Prestige Buyer Program, we can obtain for you the financial documents of the buildings you are interested in after offer. The main factors that determine stability of an association are:
- How many owners are more than 30 days delinquent on their fees? A stable building is normally less than 15%.
- How much is in reserve? A building with high reserves means it can absorb non-paying owners and cover future maintenance items. But it can also mean that the monthly fees are higher. If there are no reserves, then usually maintenance fees are lower, but owners get assessed extra payments if there is a shortage or unexpected maintenance is needed.
- How many units are rented? A stable building is usually less than 50% rentals. The higher amount of rentals, the riskier it is that there will be defaults.
4.) Are there any buildings that permit pets?
Be careful of buildings that do not allow pets or have weight and size restrictions. We will do the preliminary searching to make sure that all the condos we look at can accommodate Spot or Rover. Typical scenarios are:
- Newer buildings have no weight limits or a limit of 55lbs and maximum 2 dogs.
- Most new and some older buildings have a limit of 20lbs and 1 dog maximum.
- Most older buildings do not allow pets.
5.) We have two cars. Is there a building that will give us reserved parking for both?
Most newer condos come with 2 assigned parking spaces if you are purchasing larger units. In most other cases, you only get one assigned parking space. Your second car can usually be valet parked, or you can purchase or rent a second space from another owner. We will make sure that every unit we show you has that option available.
6.) Why are condo association fees so high?
Monthly condo fees vary from approximately $200 for entry level studios to over $1000 for larger units in luxury buildings. At first glance you might think that this is high, but you have to keep in mind that generally your fees include external maintenance and landscaping; upkeep for pools, gyms, spas, entryways, tennis courts, garage, common areas, roof, trash, water, cable tv; insurance (hazard, wind, flood),
and a reserve fund for future painting, paving, and more. If you own a single family home and add up all these separately, often you will find that it actually costs less per month to own a condo. It will be our pleasure to provide a detailed breakdown of your fees and what they cover when we find the right place for you.
7.) I’d like to rent out my unit. Do I need special permission?
You can be among the many condo owners who rent their units out part-time or full time throughout the year. Each condo association has its own regulations about the rental process. Some do not allow rentals but most do. Restrictions vary from minimum lease terms of 1,3,6,12 months, or a maximum of 1,2,3,4,or 12 lease per year. I will investigate the rules for each building you are interested in so that you can work the situation to your best advantage.
8.) I live out-of-state. Do I have to travel to to start my condo search?
You can carry out the entire condo buying process without having to travel here. As a member of the Prestige Buyers Club you will receive exclusive walk through video tours of the units you are interested in and we will work with you or your representative to oversee every aspect of your condo purchase transaction. This service is available to you whether you live across the state, across the country or anywhere in the world. For the ultimate stress-free experience, you can choose any of our Concierge property management services. We can open your corporation and bank account, handle bill payment, attend the in-person condo interview and post closing orientation on your behalf, turn on your utilities, coordinate your upgrades and furniture, arrange housekeeping, and even rent or manage the unit. .
9.) How much are the property taxes?
Property Taxes are approximately 2% to 2.5% of the county assessor’s opinion of the market value of your property. The taxes are due at the end of every year. . For all tax information you ask us and we will provide you the links.
10.) How much does it cost to buy a Condo?
To make an offer, you normally need at least a $1000 deposit which can be held by your attorney, or one of our title company’s escrow accounts. Once you have an agreed upon contract with the seller, then your timelines start:
- Your home inspection is due within 5-7 days. Typical upfront non-refundable cost is $250 to $750 based on size of the unit.
- If you are financing, the loan application must be made within 3-5 days. Typical upfront non-refundable cost is $350 to $750 which covers the cost of the formal appraisal required by the bank. The financing process typically takes 30-45 days to complete.
- The condo application must be made within 3-5 days. Typical cost is $100 to $200. You normally have to submit proof of income, tax returns, bank statements, and reference letters. After the association performs a background check and credit report, they will contact you to conduct an in-person face to face interview and will give you an original sealed approval notice for you to take to the closing company. The process typically takes 25-30 days to complete.
- At settlement you will incur closing costs for the whole transactions. If you are paying cash, your costs will normally be less than 1% of the price and this includes your title insurance. If you are financing, then it could range from 1- 3% to depending on the type of loan you are obtaining. Your lender will give you an estimate of these costs within 3 days of your loan application.
We Have identified 94 things that can go wrong during your home buying process, as your EXPERT Advisors, we will manage all 94 of these things that can go wrong using our 79 point Homebuyer checklist………
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Samples of allowed searches:
3 beds, 2 baths
4 rooms, 2 baths, New Jersey
5 bedrooms, 4 bathrooms, 07010
1500 square feet, Hoboken
2500 sqft, 4 rooms, 3 bath, Jersey City