3 Questions to Ask Yourself Before Buying a Condo

Buying a condo can be a great way to get on the property ladder -- especially if you don't want all of the maintenance and expense associated with buying a house or if you live in an area where condos are cheaper or more plentiful.

But condo living isn't for everyone. Before you jump into getting a mortgage to purchase one, there are a few key questions you need to ask yourself to ensure this type of property is right for you.

1. Are you OK with having neighbors close to you?

Condo owners tend to live in closer proximity to their neighbors than people who own either a townhouse or a single family home. In fact, the experience of living in a condo building can be more similar to the experience of living in an apartment. You are likely to have neighbors both above and below you, and your building may have many units depending on the type of condo you select.

Having a lot of neighbors close to you can have pros and cons. You may make friends with those around you, your kids may have tons of other young people to play with, and there may be plenty of people around to socialize with. On the other hand, you may not like the people around you, or you may be bothered by the noise and the absence of privacy.

You'll have to think about your personality and preferences when you decide if a condo building is a place where you would feel comfortable living.

2. Do you know the condo association rules, and can you live by them?

Condos have associations, and there are almost always rules and regulations you are going to have to follow and that the association is going to enforce. You may not be allowed to do a short-term lease in your condo, for example. You may be limited in the number and type of pets you can have, and may even have restrictions on changes you can make to the condo you own.

You need to be OK with living by whatever requirements the association imposes, as you're not likely to be able to change them, and there can be penalties for violations.

3. Are you OK with paying all the fees you could owe as a condo owner?

When you own a condo, you will typically incur monthly maintenance fees. These costs are intended to help pay for shared amenities and the upkeep of common spaces. But they may not be the end of the expenses that you could be responsible for.

In some cases, if a condo building must complete a big project -- such as replacing the roof -- you will get hit with special assessments. This is an especially big risk if you buy in a condo building that doesn't have a large reserve fund (or that doesn't have a reserve fund at all).

These added fees can be very expensive, so you'll need to understand when and how your building could charge them, how likely it is you'll owe based on the size of your building's reserve fund, and whether you have the room in your budget to cover them.

By asking yourself these three questions and taking these issues into account, you can make certain you won't regret your condo purchase.