For some homebuyers, condos are an attractive option. According to the U.S. Census Bureau’s Annual Housing Survey, there are approximately 7.4 million condo units nationwide. That translates to about one in 16 homes is a condo.
Condo Advantages
Compared to a “traditional” home, condos can be appealing for a variety of reasons.
There are less maintenance responsibilities. Things like mowing the lawn, shoveling snow, repairing exterior elements and other items are handled by the property management company.
Condos also offer a variety of amenities that might include – fitness centers, pools, clubhouses, shared outdoor spaces, a concierge and more.
For young people looking to become first-time homebuyers, those who travel frequently, empty nesters who want to downsize and many others, condos are a great option.
“Owning a condo offers many advantages,” says Tom McCormick, board chair for the Greater Milwaukee Association of REALTORS® (GMAR) and broker/owner of EXIT Elite Realty. “However, to help avoid surprises and ensure a smooth ownership experience, buyers should be informed about the unique issues related to condo ownership and work with a REALTOR® to navigate the condo-buying process.”
Homeowners Association (HOA) Rules and Fees
A Homeowners Association (HOA) governs every condo with specific duties falling to the condo board, which oversees the management and operation of the condo community. Their duties typically include enforcing the HOA’s rules and regulations, managing the association’s finances, budgeting for routine maintenance and capital improvements and ensuring that common areas are properly maintained.
“HOA rules can cover everything from the color of the front door to pet ownership and rental restrictions,” says McCormick. “Regulations, while intended to maintain harmony and property values, may feel too restrictive so prospective condo owners should thoroughly review the HOA bylaws before purchasing.”
Monthly HOA fees may also increase over time, and unexpected special assessments for major repairs or improvements can be costly.
“Before purchasing a condo, buyers should conduct a thorough review of the HOA’s financial health,” he adds. “Looking through past and current budgets, improvement plans and fee increases sheds light on the property’s financial strength.”
REALTORS® can help buyers review the HOA bylaws and financial statements and highlight any restrictive regulations or potential red flags, such as rising fees and special assessments. They also help buyers ask the right questions about the association’s governance, financial stability and dispute resolution processes.
In addition, REALTORS® can help connect buyers with current residents or board members to gain firsthand insights into the community’s dynamics and common issues.
By leveraging their experience and resources, REALTORS® ensure that buyers are fully informed about what to expect, empowering them to make confident decisions and avoid unpleasant surprises after the purchase.
Limited Control Over Property Decisions
Unlike owning a single-family home, condo owners share decision-making authority with the HOA and other residents. This can mean limited control over property management, exterior appearances and maintenance schedules.
For example, if the building needs significant repairs, an owner may have little say in how or when those are addressed but will still share the costs. Disagreements among residents, or with the HOA, can sometimes lead to legal disputes or prolonged delays in necessary improvements.
According to Chris Corley, broker/owner of Corley Real Estate, a REALTOR® can explain how HOA rules and policies may restrict renovations, exterior changes and other personal preferences.
“Buyers should know in advance what decisions are subject to board approval,” says Corley. “They can also review the bylaws with buyers to highlight specific areas where owner autonomy is limited.”
Resale Value and Marketability Challenges
Condos can sometimes be harder to sell than single-family homes, especially if the complex has high turnover, significant maintenance issues or restrictive HOA policies. Changes in the local market, such as an oversupply of condos, can also depress resale values.
However, in the Greater Milwaukee area, condos are in short supply so well-maintained and appropriately priced units typically go quickly. Most of the condos are located in the city of Milwaukee, especially downtown, the Third Ward, along the lakefront and on the East side. Shorewood, Brookfield and Waukesha also have concentrations of condos.
“In the downtown area, the beauty and tranquility of Lake Michigan is a major draw for buyers and condos with a water view literally sell themselves,” says Corley.
The REALTOR® Advantage
A REALTOR® is a member of the National Association of REALTORS®, is committed to a Code of Ethics and has the expertise to find the right home for everyone. Look for the “R” to determine if your agent is a REALTOR®.
Locally, the Greater Milwaukee Association of REALTORS® is a 5,500-member strong professional organization dedicated to providing information, services and products to help REALTOR® help their clients buy and sell real estate. Visit gmar.com for more information.