With Ontario’s Growth Plan essentially mandating intensification, get close to a downtown and you will visually see the tower cranes hard at work. There’s a noticeable prevalence of Condo Towers, Warehouse/building revitalization, and Townhouses with seemingly more being added monthly. This influx is leading to a very common question from many first time buyers, downsizers or investors:
“Do I buy a condo or a house?”
I find the choice automatically becomes a financial (and rightfully so) one when more often it should be a financial AND a lifestyle decision. Many people believe a condo (with its fees) is more expensive than a semi or detached home. But there are many oversights in this comparison and is quite frankly like comparing apples to oranges. Step back and truly compare apples to apples. Where else can a buyer (potentially with limited resources) have home ownership, modern high-end facilities, access to private park or common areas, generally have a prime view, use professionally decorated entertainment room etc, etc……and all of this usually in the best location in town!!??
With a house don’t forget to add in:
The real cost of a proper home maintenance program
The establishment of a home reserve fund for sudden unexpected and often significant repairs
The cost of labour – your labour to get things done around the house
These days, we are all very busy trying to make ends meet – some of us may not realize it but we are on the go, non-stop…and caring for a house takes time, money and effort.
Let’s make a fair comparison:
If you look at it from an investment perspective, there can be many other advantages too. Almost hands-off maintenance, with a home - either you do this yourself or hire a property manager. A condo Tenant will need to follow rules and regulations as set out in the Declaration. Further to this, some condo’s have a no pet policy which supersedes the Residential Tenancies Act. This I believe can be the single most important concern with some landlords – animals can quickly produce undue wear & tear, diminishing any realized profits. With the general community atmosphere you will have many other unit owners looking out for not only your investment but theirs as well.
As with anything you need to base your decision on comfort level and what makes sense for you. Investigate your options, gather all available information and make a knowledgeable decision. Most importantly, consult with a professional Realtor, get out in the marketplace and view all your options!
“Do I buy a condo or a house?”
I find the choice automatically becomes a financial (and rightfully so) one when more often it should be a financial AND a lifestyle decision. Many people believe a condo (with its fees) is more expensive than a semi or detached home. But there are many oversights in this comparison and is quite frankly like comparing apples to oranges. Step back and truly compare apples to apples. Where else can a buyer (potentially with limited resources) have home ownership, modern high-end facilities, access to private park or common areas, generally have a prime view, use professionally decorated entertainment room etc, etc……and all of this usually in the best location in town!!??
With a house don’t forget to add in:
The real cost of a proper home maintenance program
The establishment of a home reserve fund for sudden unexpected and often significant repairs
The cost of labour – your labour to get things done around the house
These days, we are all very busy trying to make ends meet – some of us may not realize it but we are on the go, non-stop…and caring for a house takes time, money and effort.
Let’s make a fair comparison:
- Home insurance - the common expense fee typically includes building and standard unit coverage. The condo owner only insures the upgrades, non-standard items and personal belongings.
- Heat & Water – most condo fees include water and/or heat (be sure to investigate this)
- Equipment - consider cost for the purchase and repair of lawnmowers, gardening equipment, snow blowers, lawn watering equipment and incidental tools
- Maintenance - don’t forget the bits and pieces e.g. exterior paint, driveway sealant, fertilizer, annual flowers, shrubs, sprays, light bulbs, and cleaning solvents – these things add up quickly
- Future reserves - allocate funds for maintenance of major items; roof, windows, garage floor, pool and landscaping. New condominiums set aside funds for this purpose that are reflected in the common expense payments
- Security Monitoring - add home monitoring cost comparable to security provided by the condo
- Garage – does a comparably priced home have a garage, better yet, does it have an underground secure garage?
- Labour Cost - don’t forget to charge for your time…even when it appears free. In a condo, you pay others but gain personal freedom (this where lifestyle really comes into play). Hard to put a price on, but certainly valuable!
- Professional Management - well-managed properties don’t happen by accident. Someone has to be paid so you don’t have to worry.
If you look at it from an investment perspective, there can be many other advantages too. Almost hands-off maintenance, with a home - either you do this yourself or hire a property manager. A condo Tenant will need to follow rules and regulations as set out in the Declaration. Further to this, some condo’s have a no pet policy which supersedes the Residential Tenancies Act. This I believe can be the single most important concern with some landlords – animals can quickly produce undue wear & tear, diminishing any realized profits. With the general community atmosphere you will have many other unit owners looking out for not only your investment but theirs as well.
As with anything you need to base your decision on comfort level and what makes sense for you. Investigate your options, gather all available information and make a knowledgeable decision. Most importantly, consult with a professional Realtor, get out in the marketplace and view all your options!
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