Condos have become a popular form of real estate ownership in Toronto especially among first time home buyers. Not only do condos tend to be the most affordable option for home ownership in central Toronto but they also offer a low maintenance lifestyle.
What is a Condo anyways and what should be considered when purchasing one?
The term condo actually refers to a type of home ownership and not the style of building as many people think. This type of ownership allows the owner to own a specific unit in a building as well as owning a share of the common property, such as the lobby, hallways, gym, recreational facility etc.
Condos offer home owners many advantages over a free hold property, such as affordability and a low maintenance lifestyle. A monthly fee, known as a maintenance fee is paid to the condo corporation each month to cover building costs such as ground maintenance and sometimes even your unit utility bills. Each month a portion of this maintenance fee is contributed to the condo’s reserve fund. A reserve fund is set aside to pay for any large repairs that may need addressing in the future, such as fixing the roof or pool.
Deciding to purchase a condo, especially for a first time buyer can be a stressful and unfamiliar process. Let’s take a look at what you should consider when purchasing a condo unit in Toronto.
1) Price – How much can you afford and what is included in the price of the condo unit? Are utilities extra? Does the condo unit come with a parking spot or a locker and if so is there an extra cost to them?
2) Down Payment – Consider how much you can afford to put down on the condo. Anything less than 20% of the purchase price must get mortgage insurance. The larger your down payment, the less interest you pay over the life of your mortgage.
3) Location – Is the condo located in a convenient are for your lifestyle? Is it near your place of employment, the gym, public transit, shops, highway etc?
4) Suite and Floor plan– Is the unit layout practical and will it be easy to arrange furniture? Where on the floor is it located? Next to a noisy garbage shoot or across from high traffic elevators?
5) Common Areas and Building amenities– Does the condo building have the amenities you are looking for such as a gym, a recreation room, guest suites, a pool etc?
6) Future value – Is the condo building and location a good investment? Is the area up and coming?
7) Reserve Fund and Condo Corporation – Your lawyer will review the status certificate to see if there is any upcoming cost or increase in maintenance fees scheduled.
Toronto condos are a great alternative to freehold living if you are looking for affordable and convenient living. When searching for your perfect Toronto condo, take the above into consideration. Happy condo hunting.
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