Should You Invest in Condos?757190
The American dream is to have two kids, a car and a house with a white picket fence. Condos don't have white picket fences. Condos have never made an inroad as a substitution for a house in fulfilling the American dream. Let me count the ways that condos are not a great investment.
Reason 1
The target market for a condo is either current college graduates that are single or elderly retirees that don't want to maintain a lawn. The size of these two demographics as a percentage of the population guarantees that there will never be a high demand for condos. A condo fits the needs of a extremely small piece of the American population. The new graduates that buy a condo usually want to trade-up to a house in a few years following getting raises in their jobs. Once they trade-up to a house they will by no means desire to own another condo.
Reason 2
Condos are nothing much more than a glorified apartment complex. Very few individuals want to invest 30 years of their lives living in an environment exactly where there is somebody living above, below, to the right and to the left of you. Neighbors who play music too loud or who cook with lots of spices make the allure of owning a condo extremely unappealing.
Purpose 3
Condos also have the negative of having a shared exercise room. If you want to work out you have to stroll to this physical exercise room and possibly wait till somebody finishes in order to use the gear. If you owned a house, you could walk to the next room and work out instantly. This is another drawback of owning a condo.
Reason 4
Condos have month-to-month association fees that you are required to spend. These charges cover the maintenance to the exterior of the building, the common locations and for maintenance. There is a board that oversees the condo association. This board can have the authority to dictate what colors you can possibly paint your unit or whether or not or not you can setup a Christmas tree or whether or not or not you can have a plant on your balcony. Many individuals find these restrictions coupled with the outrageous fee enough to discourage them from owning a condo.
Purpose 5
Condos have traditional skilled a much reduce price appreciation than houses. In market declines the price of condos reduce much more rapidly than houses. Nobody wants to invest six figures in a location to live only to find out the value of the property has not elevated five years later. Individuals would much rather invest in something that will appreciate and condos rarely fit this requirement.
