High-rise living is on the rise, but there’s more involved than you may think in choosing a condo that’s right for you
Call it the New West’s big sky land rush.
High rises are once more booming developments in Dallas. All those cranes you see Downtown are transforming the skyline with tenants again not with just office employees, but full-time 24/7 skyscraper condominium residents. And although most people tend to view condos as smaller sky arks without the yard work, buyers may not think about the very distinctive differences between owning a condo and owning a single-family home.
Most condo dwellers, perhaps unlike many of their single-standing-home breathren, tend to congregate at polar opposite ends of the experience spectrum: Either they’re first-time purchasers seeking affordability, or long-time homeowners looking to downsize to an easier, maintenance-free lifestyle.
In Dallas, condos are a wonderful lifestyle choice, but be sure of what you are buying and, more importantly, what you are buying into.
Uptown developer and designer Alex Remington epitomizes a new wave of young, cutting-edge talent in Dallas’ burgeoning contemporary living spaces market. "Properties enhancer" is probably a more fitting title for him, as Remington specializes in transforming dated condo residences of yesteryear into state-of-the-art, jaw-dropping showplaces of sophisticated modernism.
So is there truth to the old real estate clichÃ© of "location, location, location" with condos?
"It is the million-dollar question," Remington agrees. "Location is most important because it affects value the most. It dictates either a value increase or a stagnant value. A better location will always protect your investment; a borderline location won’t, especially if it’s a buyers’ market, like it is now, and real estate prices are going down."
He pauses. "In theory they’re going down," Remington clarifies. "Dallas hasn’t seen a lot of that yet."
As a rule of thumb, there are five questions you must first ask to get a better feel of whether condo living is the life for you.
First: Is the building professionally managed (as opposed to self-managed, as many of the smaller complexes must be for economic reasons)?
Second: Ask yourself if you foresee moving within the next five years or so. Despite our currently cooling real estate market, if you can afford to remain in your condo property for that long, it almost certainly will increase in value.
Third: Can you afford the monthly condo association fee (or assessment)? In condo living, your mortgage is just one part of the tab. Monthly association fees will vary greatly from building to building in Dallas, from as little as the low three-figures, to as high as the low four-figures.
Remington says good questions to ask are, "Just how healthy is the homeowners’ association budget, how well is the HOA board run and how healthy are the budgetary reserves?"
"I advise customers to ask for the last six months of HOA meeting minutes to see what the board is discussing," adds Keith Yonick with Prudential Texas Properties. Yonick, who sold numerous condos in the Uptown area last year, suggests investigating whether the developer has any older properties and comparing those HOA documents they might provide insight into where your potential unit will be in a few years.
Still, don’t allow HOA dues alone to scare you off. Remember, single-family dwellings have their own hidden costs, from gardeners to pool boys. So, if you travel frequently on your job and have neither the time nor inclination to handle yard work and routine repairs, condominium association dues were probably invented just for you.
Fourth: How much is in the "repair" fund? If your complex is less than 10 years old, the reserve fund should have 10 percent of the cost of replaceable items (roofs, pools, tennis courts, fitness center equipment, etc.). A building between 10 and 20 years old should have a repair fund at 25 to 30 percent, and at 20 years, the amount should be a minimum of 50 percent. (A building whose residents pay a seemingly too-good-to-be-true low monthly maintenance fee may be either a complex not kept up well or one living beyond its means.)
Finally: Is the condo you’re considering an investment choice or a lifestyle choice? Condominiums, over the long haul, do not appreciate in value nearly as much as single-family homes.
Either way, make sure you are allowed to remodel in the time and way you want before signing anything.
"Most remodeling has to be approved by the HOA and there are restrictions on use of the elevator and even work times for contractors," notes Yonick. "Some buildings require an approved vendor on the vendor list for the complex and insurance allotments."
That said, condos are usually much more convenient to shops, entertainment and other amenities; and again, all repair work is worry-free and upkeep is not your responsibility a phone call will have somebody there to fix your air conditioning in mere minutes, and the doorman can probably let in delivery people and other service personnel instead of you taking off work to be there when the cable guy finally shows up.
But what about those other questions everything you never thought to ask the before you moved in? There are some very real "outside the box" questions that one should never, for whatever reason, be ashamed to ask. Perhaps you either didn’t think of them at the time, or if you did, maybe you considered them trivial. Keep in mind however, when purchasing real estate, nothing is ever too embarrassing or insignificant to discuss in advance.
Start with the most basic questions: Does the condo afford the privacy I desire? Does your panoramic view offer a level of discretion comfortable to your lifestyle? If you prefer sunbathing on your southern-exposure deck in a spandex thong the size of a doily, are any of the neighbors going to be offended? (Worse are any of them voyeurs likely to take photos and post them on the Internet?)
The easiest way to make sure everything on the checklist is met: Don’t be shy with your agent. Bluntly ask, "How many of your homeowners have come back after six months and said, ‘You SOB, why did you sell me that condo?’"
The agent will do one of three things: laugh, blush or stammer.
If he stammers, go somewhere else.
This article appeared in the Dallas Voice Defining Homes print edition March 7, 2008
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