8 months ago
Justin Becker ·
Comments Off on Buying a Condo vs. Renting an Apartment: Which is Better?
The debate on condo vs. apartment is one that has always divided opinions among people. If you are looking for a new home, should you buy a condo or rent an apartment?
While some may think that buying a condo is better suited for their needs, others choose to rent a house as their preferred choice of living arrangement. Choosing between owning a condo and renting an apartment can be complex and stressful. Many lifestyle and financial considerations need to be addressed so that you make an informed decision.
Let’s take a look at the comparison between buying a condo vs. renting an apartment. What makes each option unique, and more importantly, which one is better?
What is a Condo?
A condominium, popularly known as a “condo,” is a private residence within a larger building or complex. When you become a condo owner, you take up the ownership of the unit, along with the right to use common areas. Together, with other condo owners, you’ll share swimming pools, garages, elevators, common hallways and gyms, to name a few. In simpler terms, you do not fully own the amenities within the building.
To own a condo means you can call the shots on who will rent your unit. You’re the landlord, and interaction with the renters will be directly handled by you. With a condo, you’ll build equity in your home. Equity is the difference between what you owe on your mortgage and what your home is currently worth. Investing in a condo means working towards building equity, especially if the property is located in a prime location.
You’ll find high-rise condo buildings in the city, offering a great living experience. The term “high-rise” refers to a building that vertically rises seven or more stories. So, condo buildings can be as high as you can imagine, and the higher you go the better the view experience.
What is an Apartment?
An apartment is a rented unit that is part of one, or more, residential buildings that is usually owned and/or managed by the property management company. In an apartment, renters have common areas to share like a swimming pool, gym, and covered parking.
Usually, units are defined by rental agreements between an owner and tenant, with a flexible lease that can range from a few months to one year. All tenants are subject to the same guidelines within the building or complex, which are established by the owner or management company.
What’s the Difference Between a Condo and an Apartment
The difference between a condo and an apartment stems from ownership. While an apartment is owned and managed by a property management company, a condo, on the other hand, is privately owned by an individual who manages it, or it lies under the umbrella of the condo community’s homeowner association HOA, which gets help from property management companies to run it.
When you rent a condo, you typically engage the owner directly, unlike in an apartment where you deal with a property manager who works for the corporation. Often, it is easier to contact the landlord directly in the case of renting a condo, however, for an apartment, you may not necessarily have as much contact with the landlord.
Condos are often managed by the owners, and renting one can be chaotic if the landlord is unreachable, especially when you need urgent assistance. If you are thinking of renting a condo, consider the availability of the landlord.
Let’s take a look at how condos and apartments compare from other points of view.
The Aspect of Cost: Buying a Condo vs. Renting Apartment
You may be thinking a condo will cost you more than an apartment. Well, to some extent you are right. Condos will typically require a downpayment to partly offset the purchase price. The downpayment can be anywhere between 3.5% to 20% of the price of the property. On the other hand, renting will cost less upfront, with requirements being one month’s rent and a security deposit.
If you lack a chunk of money to offer upfront, then you’ll probably have to rent, which is typically less costly than buying a condo. That said, depending on the location of the property, the monthly costs of a condo and an apartment could be similar.
Cost Associated with Buying a Condo
Condo owners are required to pay monthly fees to HOA. The HOA fees represent the largest expense of the condo lifestyle. The HOA fees are used to facilitate the maintenance, and other expenses such as parking, insurance, and a contingency fund. The downside of paying this fee is that you never get it back, nor does it build equity.
Unlike apartments, owning a condo comes with paying property taxes. This means condo owners incur extra costs, in the name of taxes, annually. You also have to keep in mind that condo closing costs can be up to several thousands of dollars.
Depending on your budget, you can pay a downpayment and offset the rest with a monthly mortgage payment.
Cost Associated with Renting an Apartment
Apart from paying monthly rent, as a tenant, you also could be paying for utilities separately, such as gas, electricity, and internet, to external providers every month.
With that said, in apartments, you don’t have to worry about closing costs. As soon as you pay a security deposit, and one month’s rent, you’re good to go.
Whether you rent an apartment or own a condo, maintenance is always a must. An issue is always going to show up that needs immediate attention before the damage is out of control. So how does maintenance vary in both condos and apartments?
Maintenance in Condos
If you are a condo owner, it’s your responsibility to fix any damages within. If you choose to let in a tenant, you may agree on what cost either of you will take, as far as maintenance is concerned. However, HOA often covers any maintenance of the community, such as the shared amenities and the building itself.
Unlike apartments where the management will organize the maintenance by sending someone to your unit, owning condos means you will have to handle the process, since you are technically the landlord.
Maintenance in Apartments
In most apartments, maintenance is offered free and available 24/7. Of course, the management doesn’t want to upset their tenants by being inefficient in essential services like maintenance. Most of the repairs are usually their responsibility, and all you have to do is submit a service request.
How Do Rules and Regulations on Both Condos and Apartments Compare, and Who Sets them?
Rules and regulations can be stressful, especially when it limits your lifestyle, right? Needless to say, you’ll have to follow them if you want to stay within the community, no matter if it is the condo or the apartment.
In the case of a Condo
In a condo, rules and regulations are likely to be set by the HOA. These regulations offer guidelines on residential living to evade chaos and unnecessary issues within the community. For example, you’ll be informed of the pet policy within the community.
It is always important to check out whether the community is pet-friendly before buying a condo. It is not a guarantee that they accept pets.
In the case of an Apartment
In most cases, the apartment’s management company is the one setting the residential guidelines to be followed by everyone. Mostly, apartments don’t fancy walls being interfered with. This means more restrictions on customization, unlike in the condos where there are fewer restrictions.
Why You Might Be Better Off Renting an Apartment
Renting an apartment gives you the flexibility you need, meaning you’ll have the capacity to move on short notice. The owner of a condo, on the other hand, has to sell the property, or rent it out, before moving. Leases always have an exit clause, giving the tenant room to terminate it as stipulated in the agreement.
More Convenient Location
Apartments often can be found in a prime location, like being a walking distance from social amenities. For instance, you will find an apartment for rent around major shopping malls and popular recreational amenities, just to mention a few.
Less Maintenance than Condos
Renting an apartment gives you the financial benefit of not incurring the maintenance cost. As discussed earlier, it’s the responsibility of the property management company to fix it.
Buying a Condo vs. Renting an Apartment
If owning a condo or renting an apartment isn’t your taste, maybe you might want to consider homes for sale. You’ll find many listings, ranging from single family to multi family homes, no matter what area you want to live, and real estate agents can be vital in helping you secure your next home. Buying a home gives you the opportunity of also building equity.
What to Consider When Choosing a Home for Sale
It’s important to be aware of the critical factors when buying your next real estate property. Let’s check out what those vital aspects are when buying a home.
Establish how much you are willing to pay for a home. Prices vary, and so do the quality and location of the house.
Do you qualify for a mortgage? Is your credit score good enough to attract a substantial mortgage for your home?
Choose a location that makes it easier for you to get access to social amenities.
To buy a condo or rent an apartment is your choice to make, but at least backing it with facts will help. Based on the discussion above on buying a condo vs. renting, we can ultimately conclude that renting an apartment is the better option.
Flexibility, financial benefits, and convenience are all part of what is important, as far as your living arrangement is concerned. Renting perfectly fits the description, and thus gets the nod any day.
Taking out an adjustable-rate mortgage can be costly, especially whenever the rate goes up. Renting will be more stress-free, as you will not have to worry about the mortgage payments.
1 year ago
Justin Becker ·
Comments Off on Should I Rent a Condo or Apartment?
For first–time renters, there’s a huge difference between renting apartments versus renting condos. The distinction can make or break your condo or apartment living experience.
The distinction between a townhouse and an apartment is easily discernible. When it comes to the apartment vs. condo contrast, however, the differences are almost imperceptible. In fact, you’re likely to confuse the two.
When selecting any type of rental property, it is ideal to have a personal recommendation based on budget, lifestyle, and convenience, among other factors. Understanding the type of property you want, on the other hand, will make the search process go more smoothly.
Should I Rent a Condo or Apartment?
Is it true that most condos are more expensive than apartments? In a nutshell, the average rent of condos and apartments is often comparable. The way you pay your bills is really the biggest difference between condos and apartments.
For example, when renting a condo, the rent often includes utilities, whereas when renting an apartment, the rent does not always have to include utilities.
With that said, a major highlight of condos and flats is that they are less expensive than renting a house or buying a house. Maintenance, among other factors, makes renting a home or house more expensive than condos and flats.
Before deciding between condo vs. apartment, it’s critical to understand what entails the two options, what they are, and how they will benefit you.
So, before going any further, let’s start with disecting what is a condo and an apartment?
What is a Condo?
A condo or condominium is a privately owned residential unit (private residence) within a building that has similar units rented out to tenants. Often, these units are owned by different individuals.
In a condo, the homeowner assumes the role of landlord and performs all of the same duties as the apartment landlord.
On the other hand, the owner does not own the entire building or the amenities; rather, they share the building’s amenities with the other owners. These amenities may include things like garages, elevators, pools, tennis courts, and gyms.
In flats, the management is the same, unlike condos. The main difference between a condo and an apartment is ownership. Generally, the owners (usually the landlord) manage condos, but flats are operated under the same management or landlord.
What is an Apartment?
An apartment is a unit within a residential building, which is owned by a property management company or single owner. All units are owned by one person and operated by a management company.
Unlike condos, flats have clear rules that are to be followed by all tenants. In case of any issue, every tenant reports to the same property manager, who often is in the office with employed leasing agents.
What’s the Difference Between Apartments and Condos?
Condos and flats have striking similarities that make distinguishing between them difficult. However, they do have significant differences that distinguish them.
Let’s take a look at what sets them apart.
Difference in Property Ownership
One of the most significant distinctions between a condo and an apartment is probably ownership.
Unlike an apartment building or apartment community, where the same person manages all units, the units in a condo community are owned and operated separately by different individuals.
When it comes to common areas, owners do not fully own them; instead, they share them with other condo owners. Condo owners frequently pay HOA (Homeowners Association) fees to cover the costs of maintaining the common areas.
So, if you’re looking at a condo, then the building unit’s ownership will tell you the difference.
It’s unlikely that a building homeowner will not hire a management company to run the building on their behalf in an apartment building. The reason for this is that apartment complexes have more responsibilities than condos.
In contrast to apartment communities, where the landlord is also responsible for the common areas, the owner will only look after the condo unit and not the common areas.
You may never meet the building property owner in an apartment complex, but you will frequently interact with the management company.
Rules when Renting Condo vs. Apartment
The rules are also a significant distinction between a condo and an apartment. Since the HOA (Homeowners Association) is in charge of the common areas, it usually establishes its own rules that tenants must follow.
Although the HOA has rules that tenants and condominium owners are expected to follow, the rules generally apply to the owner rather than the tenant.
There’s also the possibility that the owners each have rules that their individual tenants must follow. Before signing a lease agreement, always read it and familiarize yourself with the rules.
On the contrary, flats rules are set by the property management company and apply to all tenants equally.
Fees when Renting Condo vs. Apartment
You won’t have to pay monthly HOA fees when renting an apartment; you’ll only have to pay the monthly rent and utility bills.
In flats, you can usually control how much you pay for utilities, but in some cases, owners manage the utilities and charge tenants a flat rate at the end of each month.
The HOA fees for condo tenants that the owner passes through may also be included in the flat fee.
When signing a lease agreement, make sure you understand the amount you’re expected to pay every month.
In flats, the property manager can provide a month-to-month lease, which is often flexible, or a yearly lease.
Maintenance when Renting Condominiums
Maintenance is also another distinguishing factor between a condo and an apartment. When you have maintenance issues, typically the speed at which the problem is solved differs.
Another consideration is who is responsible for the maintenance cost. Unlike apartments, you or the owner would cover the maintenance cost in condos; however, this could be a surprise expense.
As a result, plan ahead of time for who will be responsible for maintenance in order to avoid any unnecessary conflicts.
In a condo, if you require repairs or have a problem, you may need to contact the owner to resolve the problem, which may be a difficult task. Since the owner is frequently not present, any emergency repair or maintenance can take time.
Also, if there’s a maintenance issue outside the unit, you may need to contact the HOA to take care of it, since it’s within their jurisdiction.
Bottom line is, reporting different cases to different people can be time-consuming.
Maintenance when Renting an Apartment
On the contrary, dealing with problems in flats will be a little more straightforward. In most cases, you would notify the property manager, and the problem will be quickly resolved.
Most property managers want their tenants to feel cared for, providing quick services and addressing any maintenance issues.
In addition, unlike condos, where you are likely to incur maintenance costs, most apartment maintenance, especially normal wear and tear, will be free.
That being said, living in an apartment provides a better living experience in terms of maintenance; it will often be smoother, and you will save money.
Which One Should You Rent: Condo vs. Apartment?
That question does not have a single answer. Condos and flats both have advantages and disadvantages. When personal preferences are combined, it will be easier to determine whether to rent a condo or an apartment.
Before deciding whether to rent a condo or an apartment, people frequently weigh their options. Condos, rather than flats, will suit you better if you prefer dealing with a single landlord.
Condos are also individually owned units that can provide higher-quality amenities than apartment amenities, so if these are important to you, condo living will be a better choice. Apartment amenities are generally similar to those found in mobile home communities.
On the other hand, an apartment will be an excellent choice if you value saving money on maintenance and receiving prompt services.
Pros and Cons of Condominiums
It’s critical to know the benefits and drawbacks of a condo before purchasing one. Let’s take a closer look and see what we can find out.
Ownership with a Personal Touch
Because condos are individually owned and allow owners to add their personal touch, in terms of style, many owners invest in luxury amenities, like kitchen upgrades and interior design, to name a few. The ultimate goal is to have a luxurious unit that is in excellent condition and is appealing.
Upgrades and maintenance can often leave you with a fantastic condo to rent for some time.
You Can Negotiate Rent
In most apartments, rent is fixed, and the room as such, so you may not get the chance to negotiate the rent to a desirable rate.
With that said, in condos, the situation is different. Most condo owners are not interested in making a profit in the long run. Some of them simply want to cover the cost of mortgage taxes and other unit-related expenses.
As a result, you can negotiate rent and get a good deal while still enjoying the benefits of living in a condo.
Condos are often mistakenly thought to be more expensive than flats. When it comes to rental costs though, the truth is that apartments and condos are similar.
As a result, you can find a reasonably priced condo with better amenities than an apartment, while still paying a comparable rent.
In condos, you’ll have a more personal relationship with the owner, which may benefit you as a tenant.
Potentially Inexperienced Landlords
It may appear that managing a unit is simple, but it is not. If you end up in the hands of an inexperienced landlord, you’ll almost certainly run into issues. As a result, you may be forced to take things slowly and work out any problems as they arise.
For example, an individual condo owner (a new owner) may take some time to get used to responding to your maintenance issues, so you should plan accordingly before signing a lease agreement. It’s not always easy to get in touch with the owner.
In most apartment buildings, the property management company looks after the property and often responds to maintenance requests quicker and more efficiently.
You do not have to pay HOA fees if you live in an apartment, but if you live in a condo, you must specify who is responsible for HOA fees in your lease agreement.
Pros and Cons of Apartments
Apartments have numerous advantages and disadvantages. Let’s see what we can find out!
If you live in an apartment, for the most part you will not have to worry about maintenance.
Apartments tend to offer better services, that’s why the management company will handle it as soon as you request it. Furthermore, you may not incur any costs following the repair.
Apartments often strive to offer professional management to all the tenants. As such, you can expect things to run smoothly during your stay.
Often, the management team offers a communication channel and how to request services whenever you need them.
Easy Rent Payment
Most apartments offer an online portal for paying rent (monthly payments). Often, such options make rent payment easy and fast.
It’s typical for apartments to have shared amenities, such as a laundry room, gym center, outdoor pool, among others.
Size and Customization
Apartments limit the amount of personalization you can do with your space. Often, you’ll have no choice but to accept what is being offered.
Also, because apartments are typically smaller than condos, if you have a lot of belongings, consider renting a storage unit, reselling, or donating to charity.
If you enjoy having pets, you may find that your apartment has breed restrictions and a limit on the number of pets you can have. Be sure to know the pet policy before deciding to move-in.
Applying for Condo and Apartment Rentals
Whether you choose an apartment or a condo, you’ll need to fill out an apartment or condo rental application at some point. It’s usually some background information to help the landlord get to know the people renting the unit.
The rental application process for apartments may require you to go through the leasing office, but it is more of a personal process for condos.
The details required may include the following:
- Photo identification
- All of your contact information
- Your social security number for running a credit check
- Proof of employment
- Copies of your last couple of bank statements
- Copies of your most recent pay stubs
- Contact info of previous landlords
- Possibly some references
In general, if you want a better chance of getting the perfect apartment or condo, make sure all of your details are correct and avoid providing false information.
In addition, your credit score will help you. Most condo or apartment landlords require a credit score of at least 620. If you have a lower credit score, don’t worry; you can still get the apartment you want, but you may have to pay a large upfront payment to cover the extra months.
Also, you should improve your credit score, as this will help you get better apartments, along with better interest rates if you decide to take out a mortgage in the future.
Choosing between a condo and a rented apartment is often a difficult decision to make. Before deciding which path to take, weigh the advantages and disadvantages of each option and compare them to your personal preferences.
A real estate agent is the best person to contact if you need to find a condo or apartment quickly. Most real estate agents know how to navigate the market and will almost always get you a better deal.
With that said, there is a catch when it comes to hiring a real estate agent: you have to pay them for their services.