Condos vs. Houses
The most important decision when starting down the path of real estate ownership is to decide which type of home will work best for you. There are several different types of homes: condominium, attached (townhouse), semi-detached, and detached (single family). Ownership regulations vary provincially, however physical housing types are generally consistent across the country.
There are many factors to take into consideration when deciding which type of home to buy:
Do you like being able to walk, bike, or take public transit everywhere, or do you own a car or prefer to drive? How much control do you want over your property, renovations, and landscaping? Do you value your privacy, or do you prefer having other people nearby all the time?
It is important to think long-term when making such a large purchase. This is where the lifestyle factors really tie in to the financial factors. If you planning on getting married or having children, you need to think about those things while shopping around. Can you make a condo work in a couple years if your family situation changes?
From an investment standpoint, a house—which comes with land—is often regarded as a desirable investment. There is typically a lot of value in buying a piece of property and land, especially in urban areas where land is at a premium since there’s a very good chance for appreciation.
On the other hand, a condominium can be a low maintenance investment option. In Toronto alone, 39% of condo buyers see their property as a long-term source of income by renting it out, and 37% see them as a source of rental income for now that they will move into later when they are ready to downsize, allowing them to enjoy the best of both worlds throughout their years.
If you live a busy life and would like to simplify your living arrangements by having virtually no yard work or snow removal, then a condo may be for you. If owning a house and all that goes with it seems intimidating, a condo is probably a good step as you can always move into a house when you and your lifestyle demand it.
Points to remember about condo/strata ownership:
You have the freedom to do what you wish inside (within the law and your condo agreement), but outside you normally need permission from the condo board for many changes and/or improvements
Monthly condo/strata fees that usually include water, sewage, exterior maintenance including snow removal and landscaping
Insurance – you only need insurance for your contents
Shared common spaces
You should familiarize yourself with the condo board
There may be restrictions put in place when the condo board was first setup or that have been voted on by everyone in the condo association
Possible pet restrictions
Possible age restrictions
Possibly required to get permission to rent
Is there enough money in the reserve fund to cover maintenance, improvements and other issues?
If you have a family and want a yard, and you really enjoy your space, privacy, and having absolute control over all the decisions that affect your home, a house probably is for you.
Points to remember about house ownership:
You have total control (within the law) of what you can do to your property
Find out what you as a home owner are responsible for
May have a private yard
Houses often come with land, and with land comes shoveling, mowing, and maintaining and repairing your property
Not required to ask permission to make interior cosmetic changes
No condo fees
You are responsible for all insurance costs – you’re buying a structure—so you need insurance for that whole structure
The price of a potential home plays an important role in the purchasing process. Make sure you run the numbers through a mortgage affordability calculator to determine which choice may better fit your budget.
How did you choose between condo and house? Let us know in the comments.
Pssst… this Sun Peaks townhome is the perfect compromise.