Is Buying a Condo a Good Investment in Massachusetts

Whether or not buying a condo is a good investment or a good idea depends on your personal circumstances and your preferences in a home. There are several factors to consider. 

Should I Buy a Condo in Massachusetts?

Condominiums – often called condos – can be a good option for people who want to own their own home but do not want the responsibility of maintaining a house and yard. Buying a condo can be a good investment in Massachusetts, but you must get good advice and ask many questions before making a purchase.

Condos are often located in more urban areas and may offer amenities like swimming pools, fitness centers, and security. On the other hand, condos with luxury amenities, especially Boston condos, might be more expensive and require costly monthly homeowner association fees (see below). 

Condominiums may have strict rules governing what residents can and can’t do. It’s crucial to understand any restrictions and weigh the pros and cons carefully before making a decision.

Should First-time Homebuyers Purchase a Condo?

A condominium may be a good option for a first-time homebuyer because condos are often more affordable than single-family homes. Some relatively inexpensive condominiums are located in desirable areas that may otherwise be out of reach for a first-time homebuyer. 

While the price of a condo might be more affordable in your desired location, it may be subject to additional costly fees, such as monthly condo fees and special assessments (see below). It’s important for first-time homebuyers to carefully consider the total cost of home ownership.

What are Some Restrictions Condominium Associations Might Have I Should Consider?

Condominium associations can have a wide range of rules and regulations, varying depending on the association and the condo’s location. Some common restrictions that condo associations may have include rules governing the appearance of the property (such as restrictions on paint colors or types of window treatments), rules governing the use of common areas (such as rules about noise levels or the times when amenities like swimming pools can be used), and rules governing the leasing or renting of units. With the popularity of short-term rentals, many condominium associations require a minimum length for leases, usually six months or a year.

Related: Make Smarter Real Estate Decisions. Subscribe to Real Boston.

It’s important to carefully review the rules and regulations of any condominium association you’re considering and ensure you’re comfortable with them before buying a unit. Although unit owners may choose to change rules, other condo owners might disagree with you and not want to revise or eliminate an existing regulation. 

What are Condo Fees?

Condo fees, also known as homeowner association (HOA) fees, are regular payments that condominium owners make to the association that manages the property. These fees cover the costs of maintaining common areas (elevators, hallways, etc.) and amenities, such as swimming pools, fitness centers, laundry rooms, and security systems. Condo fees may also be used to pay for utilities, insurance, and other expenses related to the operation of the condominium complex. It’s important to know what fees cover. 

Condo fees are typically paid monthly, and the amount can vary depending on the size of the unit and the services and amenities included. It’s important to factor these fees into your budget when considering the cost of purchasing a condominium. Also, be aware that condo fees will increase over time as the cost to maintain the condominium complex increases.

Do Condominium Associations Allow Pets?

Whether or not a condominium association allows pets typically depends on the rules and regulations of the specific association. Some condominium associations may allow residents to keep pets, while others may restrict or prohibit owning pets. Some associations might let you own a cat but not a dog, or the HOA might limit dogs to less than a certain weight. The number of pets likely will be limited.

It’s important to carefully review the rules and regulations of any condominium association you’re considering to ensure you’re aware of any pet-related restrictions before buying a unit. If you’re a pet owner who wants to buy a condominium, consider looking for a property that specifically allows pets or has few restrictions on pet ownership.

What are Special Assessments?

Special assessments are additional fees that the association that manages the property may charge to owners of condominium units. These fees are typically used to pay for unexpected expenses or significant repairs not covered by the association’s regular budget. For example, a special assessment might be levied to pay for a new roof or repave a parking lot. Special assessments can be a significant expense for condominium owners, and they’re typically paid in addition to regular monthly condo fees. 

Sometimes special assessments are paid in one lump sum, and others are added to the monthly condo fee for several months. It’s important to carefully review the budget and financial policies of any condominium association you’re considering so you’re aware of any potential special assessments you may be required to pay.

Will the Value of a Condominium Rise With the Market?

Condominium prices have risen 43 percent since 2017 in Massachusetts. The median condo price in 2022 was $501,000. In 2017, the median price of a condominium was $350,000. The median price of a single-family house was $575,000 in 2022, 53 percent more than in 2017.

Of course, all real estate is local, so any type of home in different cities and towns may increase or decrease in price more dramatically than statewide movements in value. Prospective home buyers should work with a real estate buyer agent who will provide market reports for specific cities and towns and analyze fair market value based on the home’s condition and location.