Apartment buildings and detached single-family home rental properties are the first things to come to mind when looking for a new space. But what about condo living?
In real estate, condos are very similar to standard apartments in that they’re individual units rented out to tenants by the owners of the property or condo owners.
What differentiates a condo vs. other types of rental units is that adjacent condos often have different unit owners. Some condos are actually lived in by the person who owns them.
A condo community comes with shared amenities, similar to an apartment building. It also includes homeowners association restrictions, condo association fees, exterior maintenance and private outdoor space. So what is a condo? Keep reading before reaching out to your real estate agent.
What is a condo?
So, what is a condo? A condo is a real estate property where an owner owns one unit in the building. The condo owners buy a condo in the building with a down payment and pay property taxes, monthly fees, HOA fees and the mortgage lender. All are similar to a single-family residence.
Condos are often popular choices for those who want the benefits of homeownership and community living without the hassle of maintaining a yard or general property upkeep like snow removal. If you don’t need much square footage, a condominium unit may be the right bet for you
Buying a condo is definitely a part of real estate investing as you get your own private residence with community amenities like swimming pools without large crowds and tennis courts and other common spaces.
Though a unit owner can own multiple condo units, it’s common for owners to own just one condo unit that they will either live in or lease out to apartment renters, depending on the condo association. They may rent the unit through a property management company, or the owner may do it themselves.
Condo owners may even rent their units for years and still choose to move in themselves later down the road into their living space. This is a stark departure from a standard apartment community or housing complex where all rental units share a singular owner.
Condos can be more high-end than standard apartments
Because condos are owned individually, owners may choose to outfit their private space with higher-end fixtures and features than other rental units. This is especially the case if the owner of the condo intends to occupy the unit themselves eventually.
This doesn’t make condos cheaper. Because of the added luxury often found in condos, they’re frequently more expensive than other rentals due to many condo fees. That isn’t the only reason condos may be pricier, however.
Most condos are individual pieces of real estate. Their owners are often subject to HOA fees generally passed along to the renter at the owners’ discretion.
Condo vs. apartment: What’s the difference?
In general, apartment buildings are rental properties owned by a landlord or property management company, while condos are owned by individual condo owners. You often have a lease in each scenario, but some key differences exist.
A condominium complex often has more benefits than apartments, such as access to shared amenities and the ability to upgrade the unit. Condos tend to come with responsibilities such as paying an HOA fee and adhering to rules and regulations set by the condo board. And you, as the renter, must also adhere to these rules that, are often more strict than standard apartment complexes.
Not every condominium association lets owners rent out their units, so confirm that you can before moving in and avoid eviction.
Are condo owners different than landlords?
A condo owner can be a landlord, but a landlord is not always the owner of the rental property. Landlords may own detached single-family homes and rent out the rental property to prospective tenants, or they can be a property management company that only manages. In that case, you are leasing the apartment and setting up your own utilities.
With a condo building, the condo owner covers the HOA fees, property taxes, condo fees and utilities since they are in their name, but these are tacked on into your monthly rent. They are essentially buying a condo and owning real estate.
Condo owners share the exterior costs with other condo owners in the complex by paying the homeowners association a monthly fee and covering maintenance costs.
As a benefit between condo vs. apartment, condo communities allow you to have a more personal relationship with the owner, mainly because they can keep turnover to a minimum. Because of this, there might be more flexibility in negotiating the monthly rent.
What is a condo fee?
Many condo associations consider external areas joint ownership when buying a condo in their complex. Most condo fees go to the condo board for maintenance costs like landscaping, lawn care, cleaning common spaces, funds for unexpected repairs, maintaining fitness centers and insurance.
The condo fees vary depending on various factors, such as the unit’s size, the building’s age, and the amenities the condominium offers. So keep this in mind when looking at your final monthly rent.
Renting at a condo community might be right for you
Renting a condo vs. an apartment might be a perfect fit if you’re looking for a living space with small square footage and trying out condo life in your own unit but want to wait to pay a down payment and closing costs.
If you’re looking to rent a high-end, well-cared-for apartment from a landlord you’ll likely be in direct contact with, a condo is the ideal type of rental for you. Otherwise, consider other types of rentals first, like a single-family home or standard apartment. Condo living is not for everyone.
Ready to find the condo of your dreams? Start your search here.
Source: rent.com