Congratulations. You’re ready to start thinking about your first home purchase! Depending on your budget, lifestyle, and appetite for responsibilities, you could be debating whether to buy a single-family home or a condo. Here are some considerations help you choose.
Space
How much space do you need now and over the next few years? A two-bedroom condo could work great today. But if you foresee growing your family, working from home, or having frequent guests, space could quickly get tight.
Consider how you, your family, and your career might have changing needs over the next three to five years when you determine how much square footage you need.
Homeowners Associations
Depending on the area you purchase in and the year of the build, your single-family home may come with homeowners association dues, just like the condo you’re considering. Find out what the dues cover and how often and how much they’re adjusted. Be sure you’re OK with a lack of control over annual increases.
Pets
Many cities have firm restrictions and permits for pets. Even if you own your condo, you may still have to follow strict HOA rules governing pets. Research the requirements ahead of time, determine if pets are limited or restricted, and decide how important these limits are to your home purchase choice.
Related: 4 Ways to Make Fido Happy in Your New Home
Maintenance
If you’re looking at a single-family home, consider who will take care of the yard, pool, roof, and more. How much home maintenance do you want to manage yourself or hire out to someone else? If you’re looking for minimal maintenance and time commitment, a condo or townhome may be a better option.
Related: 7 Home Hacks That Make Maintenance Easier
Location
If your style is city living and you want to walk to dining options and activities, a condo is likely your best option. Make sure you’re willing to sacrifice square footage for your preferred location.
Related: How to Choose a Neighborhood
Parking
If you’re looking for a private garage for your vehicles and want to avoid underground structures or parking on the street or in the open, a single-family home will better suit your needs.
Privacy
Do you like privacy and peace and quiet? Are you OK with hearing a neighbor through the walls or someone overhearing a spat between you and your spouse? Depending on the amount of privacy you want, a shared backyard fence may be better for you than a shared dining room wall.
Future Rental Plans for Your Home
If this is a home you anticipate turning into a rental property, figure out how much rent you could get at current rates. Be sure to calculate whether it’ll cover added-in costs like HOA dues, insurance, and maintenance.
Type of Mortgage
Planning to put less than 20% down on your new home? You might consider a Federal Housing Administration loan. The FHA is a government-backed agency that assists home buyers with mortgages and uses loan qualifiers lower than the ones independent mortgage outlets require.
Purchasing a condo unit with an FHA loan requires the FHA to approve both the lender and the condo community. You can determine if the property you’re looking at is FHA approved by searching on the HUD website.
Whether you opt for a single-family home or a condo, do your research and pick the home type that's compatible with your budget and lifestyle. The numbers matter with a purchase this big, but so does your comfort. Don’t settle for less than what you'll enjoy.
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