Many American millennials choose renting over buying, but with rental costs high, it may be time to reassess if it’s really worth delaying homeownership much longer.
“Rents have grown at roughly twice the pace of wages” since 2000, according to Zillow research. The same report notes home buyer benefits such as “mortgage interest rates near historic lows and home values that remain below their pre-recession peaks in most areas.”
And while you may doubt your ability to afford a house of your own, chances are if you’re making at least an entry-level salary and have decent credit, a condo isn’t outside your grasp. An affordability calculator can help you determine the condo price you can afford.
Committing to a place can be nerve-racking, but it doesn’t have to be. Here are five reasons why you may want to invest in a condo sooner rather than later.
You can probably still live in your favorite neighborhood
It tends to be more manageable to afford living in your city’s most popular neighborhoods if you buy a condo instead of a single-family home. In downtown areas or college neighborhoods, condos can be a nice alternative to high-priced single-family homes.
You’ll save money
Chances are you’re actually paying more in rent right now than you would pay for a mortgage and homeowners association (HOA) fees combined. Sure, your future condo will likely be a bit smaller than a single-family home, but your monthly payments will be smaller, too. (Less space to heat and cool means lower utility bills.)
And generally, you’ll pay less on maintenance and upkeep with owning a condo than if you purchased a house. Of course, you’ll want to factor HOA fees into your mortgage payments, but HOAs usually cover external repairs, some recreational amenities, and sometimes even water.
You’ll save time
With condo living, you’ll probably have access to grassy areas on the property to host a cookout and walk Fido — without having to spend your weekends mowing grass and trimming hedges.
And living on a community property means you won’t have to deal with shoveling snow, either. Another perk? Any external issues should be covered by your HOA, so you probably won’t have many weekend maintenance projects.
You’ll make new friends
While owning a house has its appeal, chances are the most affordable options are single-family homes in the suburbs — likely a bit of a drive from your favorite urban hangouts. But if you live near a university or in an urban area, your condo neighbors will likely include many young professionals, grad students, and young families.
The condo complex’s management team will probably throw community events periodically as well, so meeting new friends is almost a given.
You’ll have a solid future investment
If you intend to live in your condo for just a few years, check with the HOA to see if you’re allowed to rent out your place. Some HOAs don’t allow this, so you’ll want to get all the details before ever putting down an offer. If the HOA allows you to rent out your future condo, then once you grow out of your sweet little home you can rent it out and save that extra cash.
If you’re curious about your possible condo options, start browsing and check out a few this weekend. Renting may be convenient, but the advantages of having a condo of your own likely outweigh any benefits you gain as a renter.