Do you notice more condos are on the market? As a potential home buyer, you should understand the condos for sale trend.
According to the National Association of Realtors, condo sales trended upward with an increase from 608,000 to 619,000 from 2015 to 2017.
The reasoning behind this increase has a lot to do with the current state of the housing market.
Housing inventory is shrinking but condos for sale are popping up all across the US.
Continue reading to learn more about why condo sales are increasing and what this means for the housing market.
Condos for Sale = Affordable Housing?
One reason condos sales are booming is due to the demand for affordable housing. In some areas of the US, the cost to purchase a home is too much for potential buyers to handle.
Home values are increasing at a historically fast rate. This is compounded by the fact there is a shortage of low to middle priced homes and rising mortgage rates.
This is why some people are turning to condos. Condos typically cost less than traditional single-family homes, making them a great alternative for people on a smaller budget who wish to no longer rent.
Owning vs. Renting
In many cases, it’s more advantageous to own rather than rent. Over time, the value of the property usually appreciates and the equity in the property also increases as the owner pays down the mortgage loan.
However, renting does have some of its own advantages. Renters don’t have to worry about maintenance costs, taxes, assessments, or other unpredictable financial obligations.
In a sense, condos have a little of the best of both worlds. Many condo communities offer apartment-like amenities such as trash pick up, snow removal, and includes maintenance and repairs to the outside of the building.
Ownership also gives people the freedom to renovate and style their homes however they may like. Additionally, there aren’t any rent increases, only a monthly mortgage payment that stays the same.
A Sweet Spot for Investors
Homeowners are not the only group looking at condos. Many developers and investors are also realizing the demand for condominiums and are buying up run down developments, fixing them up, and then placing these condos for sale.
Many of these communities can be found in cities like Las Vegas, Washington D.C., and Manhattan. As cities continue to grow, space will diminish, and prices along with demand will continue to rise. Condos will be a solution for those in these markets.
Other small-time investors are also buying up condos to use as rental properties. Some often seek out foreclosures or short sales in hopes of finding a good deal.
Rental properties can be especially profitable near tourist destinations during the high seasons, offsetting the cost and potentially bringing in side income.
Wrapping Up
Condo sales are increasing for a reason. Buyers see condos as more budget-friendly, appreciate the amenities they include, and recognize the investment potential they have.
Those in the market looking to buy should consider looking at condos for sale in their area.
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