If you’re looking to buy real estate in Minneapolis, there are plenty of options available. The popularity of condominiums are on the rise throughout the state
As you probably already know, condos are large property complexes that are divided and sold in separate units. When compared to a single family home, owning a condo includes partial ownership in shared “common property”. This offers unique opportunities for those purchasing a condo in Minneapolis.
If you’re considering the condominium lifestyle, here’s a guide to help you learn more about this property type and what the ownership entails.
What Property Type is Right for You?
As you start the home shopping process, you may be curious about the different types of real estate and what they offer. Here are the most popular types of properties home shoppers are choosing in today’s market:
- Single-family homes can provide privacy and are completely customizable, but come with larger price tags, more maintenance requirements and more expenses in general.
- Apartments provide convenience in the location you want, but offer no equity opportunities (for renters), and limited privacy and customization possibilities.
- Condos normally take the form of a shared complex, popular in places with high property values. With condos, home ownership is possible for those consumers that can’t afford a single-family home in highly desired areas. If you want to own your own home but can’t yet afford a house, a condo is a great option for breaking into the market.
Why Choose a Condo?
There are plenty of reasons choosing a condo is better for you than a single-family home or an apartment – money, of course, being a main one. Historically, condo prices appreciate slower than houses, making them an affordable option for those shopping in markets where prices are rising. Condos also offer advantages over renting an apartment. Since you own your condo, you can benefit from tax deductions such as the interest on your mortgage.
However, while the price tag may be cheaper, it’s important to know that most condos and co-ops have monthly fees for upkeep of the common property. While these can be costly in some places and reasonable in others, you won’t have to worry about routine maintenance around your home and will always have a well-groomed, attractive neighborhood.
It’s not always about money, however. The condo lifestyle can be attractive to those many types of shoppers. For those looking for an affordable vacation home, condos present a unique opportunity to buy a little slice of paradise in top vacation spots. It’s also an attractive option for retirees who want to keep up an active social life, while not having to worry about the chores that accompany owning a house.
Condo vs. House
When you purchase a single-family house, you own an entire piece of land and all the structures that occupy it. The only restrictions on what you can do to your property are mainly decided by the city you live in. Additionally, you assume responsibility for everything from maintenance and upkeep to repair and replacement. You’re paying for gas, water, sewage and trash removal as well as insurance, mortgage and taxes. If your air conditioning goes out in the summer or your roof gets damaged in a storm, it’s on you to deal with the problem.
A condo, on the other hand, is a space in a building that you share with other residents, much like an apartment that you’d actually purchase. The top level units are the most sought after because there’s no noise coming from above. In a condominium, many of those costs that are associated with home ownership are shared and covered by the monthly association fees. Typically condo fees are the highest but cover a lot of complicated problems.
Searching for a Condo in Minneapolis
If you’re searching for a condo in Minneapolis, the process is very similar to shopping for a single-family home. Whether you know exactly what you’re looking for, or need some guidance, a real estate agent will be your best bet at finding a property you may not be able to find on your own.
If you want to take on the challenge yourself, visit real estate websites and MLS listings and scan their available condos for sale. If there’s a certain complex that you find attractive, they most likely have a sales office on-site. Stop in and speak with a property agent to learn more about the property and take a tour.
How to Buy a Condo in Minneapolis: Questions to Ask
Now that you’ve made a resounding decision to buy a condo in Minneapolis, here are key questions that you need to ask your real estate agent before signing on the dotted line.
How much are the monthly condo fees (HOA), how are funds used and what advantages do they provide?
Once you’ve settled on a target budget, you now know how much you can afford to pay for your new condo and the HOA fees that come along with it. Remember, when buying a condo, you’re paying for the mortgage, taxes and insurance, in addition to the association fees. Essentially, you’re paying for the benefit of having a well-kept neighborhood and hassle-free home.
These fees will keep the streets clear of snow, leaves and debris, cover lawn care, cable and other amenities, maintenance upkeep and damage repair. Make sure these expenses are laid out so you can stay with your budget.
Do most of the complex’s residents rent or own their condos?
This will give you a good gauge on the quality and value of the condo complex. In Minneapolis, if the renter population is over 10 percent, generally a rental policy exists and dictates the rules of renting property in the given complex. Many choose the condo lifestyle because they don’t want to live with renters, who tend to care less about their properties and have a higher turnover rate. If the complex you’re looking at has a high percentage of renters, you may be missing out on a better opportunity elsewhere.
What future projects are in store for the complex?
Improvements to the condos and the complex as a whole will only boost your property’s value. When you buy a condo in Minneapolis, you’re going to be limited as to what you can update or modify. A complex that is worth joining will have improvement projects in place to provide a better living experience and more value to the residents.
What rules does the condo association enforce?
With a single-family home, you’re free to do whatever you want (under the law, of course), whether it’s make noise, modify the landscape or build an addition. Condos are a bit different, in that buildings are normally connected with at least one other building. The association will have a set list of rules, that could include things like noise level, pet ownership, grill location and more.
What issues does the complex face?
Before buying your condo, you should request and read documents that apply to the association management of the complex. When you find a condo that seems right for you, ask to see the association’s meeting notes to understand issues or problems that the complex is currently facing. This will give you unparalleled insight into the way management runs the property and how they react to resident concerns.
How big is the condominium’s reserve fund?
The fees that you will be paying for the luxury of living in a condo typically go into a reserve fund as they’re paid. You can ask for a review of the reserve fund for the past five years upon request. As a standard, newer associations should have at least 10 percent of the cost to replace items such as pools, roofs and tennis courts. It’s not a great idea to choose a condo building that doesn’t have liquid cash for upkeep and replacement needs.
What are the Terms of my Condo Contract?
When you’re buying a condo, you shouldn’t only be concerned with the sales contract – you’ll also be signing an agreement that declares the way the condo complex operates and how it’s governed. You need to get a solid idea of whether the complex you’re considering is well run, the rules and regulations that you’ll have to live by, and if there are any issues that could hurt the value of your share of ownership. Get all of this information by asking the right questions and you’ll be satisfied with your purchase for years to come.
Best of Luck Buying Your Condo in Minneapolis!
Now that you know how to buy a condo in Minneapolis and what ownership in a common property entails, start your search today and find your dream home! As the popularity of condo living increases throughout the state of Minnesota, now is a great time to buy.
Make sure you weigh all the options that the condo lifestyle offers before joining an association. With luxurious amenities, low hassle, more affordable prices, a condo may be the perfect option for you.
If you want to buy a condo in Minneapolis, contact AD Hays Group today. We’re the leading provider of condo real estate services in the Twin Cities, serving clients of all types. We’ll listen to your desires and goals and help place you in your dream condo. Ready to get started? Get in touch today.