Condominiums offer good return on investment

Is condominium living right for you? According to the National Association of Home Builders (NAHB), condos are fast becoming a popular choice for home buyers nationwide. Condominiums represented slightly more than a quarter of all multifamily development started last year, and the rate is likely to increase. Condo sales are also on the rise, up 9.5 percent in 2003 over the previous year.

Why the increase in popularity? Many homebuyers find that condos offer different advantages than a traditional single-family home. For example, you may want to consider purchasing a condo if you are nearing retirement, frequently vacation in a specific area or own a home that is larger than you need after your grown children have moved out. Condominiums also provide an attractive option for younger buyers who are considering purchasing their first home.

If you belong to one of the following groups, you may find that condominium living is a good bet:

Baby Boomers

Baby boomers anticipating retirement frequently purchase condominiums or townhomes, often in areas boasting warmer weather, cultural attractions and easy access to good medical facilities. Consider the fact that as you age, activities like mowing the lawn and cleaning the gutters may lose their charm. If you invest in a condominium, many everyday maintenance activities are no longer necessary, and the few that are generally are covered by your monthly condo fee.

Vacationers

Historically, the market for condominiums in scenic or vacation locations has been strong, thanks to consistently high resale values. Keeping a second home tidy and undisturbed in the off-season can be a chore; however, when you purchase a condo, most of the unit’s upkeep is covered by your monthly condo fee, whether you are in residence or not.

Empty NestersRather than vacations or retirement, many empty nesters are thinking about enjoying their freedom now that the kids are out of the house. Older couples — especially those who once lived in urban areas — are returning to the cities, leaving behind the larger house, yard maintenance and the lengthy commute to downtown offices. If you fall into this category, you may want to opt for a smaller, easier-to-manage condominium home that’s not only close to your job, but also to shopping, fine dining and entertainment.

First-Time Homebuyers

During the most recent period of unusually low mortgage interest rates, relatively young first-time home buyers are finding that buying a home is both more attractive and more feasible. If your income doesn’t quite stretch to the cost of a single-family “starter” home, look at a condo as the first step toward a more substantial residence. Many of today’s condos are easily accessible via mass transit, in neighborhoods where young professionals congregate.

While a condo can be a solid first step toward a larger home purchase down the road, it is also a good stand-alone investment. According to the National Association of REALTORS?, condominiums are increasing in value at twice the rate of single-family homes. Although single-family homes in some areas are continuing to appreciate more quickly than multifamily homes, in most regions condos are keeping pace or forging ahead.

Additionally, multifamily developments built to be sold as condominiums often feature lavish amenities and services that add value to your purchase, especially in communities hoping to attract empty nesters interested in trading a large home for a smaller, more luxurious living space.