A condominium is the ideal home for many people, but shared ownership means there are special points to consider.

People who want to make the switch from renting to owning often choose a condominium as their first “real home.” Other buyers purchase a condo as a part-time holiday retreat or are attracted by a lifestyle that has fewer responsibilities.

What’s a condo?

A condominium is not the same as an apartment, although condo developments may include apartment-style complexes, townhouses or converted multi-family dwellings. It is different from other multi-tenant buildings in that the developer has legally declared it to be a condominium and units in the building or complex are purchased rather than rented. In most states, this means that the development falls under specially designated laws and regulations applied to condominiums.

Shared spaces

A condo owner buys title to his or her individual unit, up to the walls, but not including them. There are also common areas of the development, such as hallways and stairwells, dividing and outer walls, pools, fitness centers, rooftop gardens and barbecue areas. These are under shared ownership and every unit owner holds an interest in these spaces. Every condo development has a unit-owners' association that manages the maintenance and repair of these shared areas. The association is elected by the condo owners and makes decisions in the interest of the community.

Fees and associations

The condo or homeowners association budgets and determines the fees for all units, usually based on the size of each unit, the number of units occupied and the projected expenses for maintenance and repair.

Condo costs

The rules

Condominiums are governed by a set of rules called Covenants, Conditions and Restrictions (CC&Rs), which are enforced by the condo association. Anyone who is thinking of purchasing a condo should carefully consider the rules, which vary from one development to another. The CC&Rs may impose restrictions on noise levels, renovation projects, pet ownership and renting.

A condominium can be a great purchase under the right circumstances, but potential buyers should be comfortable living within certain rules and restrictions and in close proximity to others.

Developers

Buyers may want to research other work a developer has done to learn if there have been problems with past projects. Find out if the developer is still in business and whether it is financially stable. Because developers do not generally retain a long-term interest in a building, their work is important. While a home inspection can turn up major structural flaws in the building, if the developer is no longer in business, the condo association may have little or no legal recourse if other major flaws are discovered in the property later on.

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