Condominiums have undergone a remarkable development, now that the laws permit individuals to own housing units in multiple-unit structures. Condo owners can deduct property taxes and interest just as individual home owners do. Generally, condos cost less for the same space, because a bunch of units cost less to build and the land cost is shared by more owners. Taxes tend to be less for a condo than for a similar space in an individual house. Whether units actually cost less depends on location as well as supply and demand, as for other segments of the housing market.
Often a condo will offer benefits not available in a single-family home. For example, a high-rise condo may look over other buildings to a lake, ocean shore, or mountains. A low-rise condo might occupy a choice waterfront site that no single family could afford.
Shared amenities such as a swimming pool, social hall, and tennis courts add value to basic living space that would not be a part of a single-family home. Thus, the cost of a condo could be equal to or exceed an individual house on its own lot. But the package is different. Comparing prices only, without noting the elements, becomes an "apples and oranges" comparison.
Numerous disadvantages may also accrue to condominium dwellers. Some people object to high-density housing, shared parking spaces, and common halls. Sometimes noise between walls or floors may be distracting or objectionable.
Another potential hazard for condo owners is the association for managing the common areas -- those parts of the condominium complex that are owned by everyone. Common areas include the front walk and entrance, elevators (if any), lawn and grounds, swimming pool, roof, and others.
Maintaining the structure is anotehr shared cost administered by the owners' association. When an owner association is run by and for the benefit of all the owners, the costs will likely be fair and reasonable. But if the association is controlled by the developer or builder with a profit built in, costs could be higher. This is a point worth investigating.
For an older person or couple, buying a condominium offers these potential benefits:
1. Owned living space can be less expensive, as noted earlier, if one selects a unit without expensive amenities. It can be a hedge against inflation.
2. Maintenance problems of the outside, roof, and grounds are avoided, as these are shared responsibilities managed by the owners' association. For retirees uninterested or unable to maintain their own house, this facet of housing can be important.
3. Condo complexes frequently provide for personal and antitheft security. This service can be particularly important when a resident may be traveling or away for days or weeks at a time.