When looking to buy a property that’s a part of a larger building, you might often see the term “co-op property.” While co-ops are similar to condos in some regards, there are a few distinct differences between the two.
You Can’t Technically Own a Co-op
“Co-op” is short for cooperative, which basically brings the concept of teamwork to homeownership. When you buy a co-op, you aren’t technically buying the property itself. Instead, you purchase shares in the corporation that owns the property and the bigger the co-op home, the more shares that you own.
The number of shares that you own doesn’t mean that you have more deciding power over other co-op owners in the building. However, the number of shares that you do own will affect the maintenance fees, your taxes, and some other financial aspects. Each co-op owner typically has roughly the same influence on the maintenance and direction that the company takes and the residents will vote on every decision that affects the property.
Additionally, some residents can have a seat on the board and will work to carry out the group’s decisions.
Where Are Co-ops?
You can find co-op properties largely on the east coast of the U.S. in the big cities like New York and Washington, DC. There aren’t many in Maryland or Virginia. According to a New York Times report, 75% of Manhattan’s housing is comprised of co-op properties, many of which carry the Trump name or other prominent brands.
Advantages of Co-ops
If you want to live at a specific address overlooking a landmark in New York City or Philadelphia for instance, you won’t have much choice in the type of housing you’ll have. Typically, properties in these areas are almost entirely co-ops. Also, living in a co-op property means that most of your neighbors are friendly and will pay their bills on time because of the strict application process which goes far in ensuring the building is properly maintained.
Co-ops are usually more “bang for your buck” than condos in that you receive more space for less money since many people are scared off by the ownership structure.
As a rule of thumb, many experts will recommend that you put down 20% or more when buying a new home. The reason they cite is that this huge sum paid before the mortgage will show lenders that you are a trustworthy borrower serious about paying off the home yielding a lower interest rate.
Is 20% still the tried-and-true standard or is it possible to buy a home with a smaller down payment? Here are the pros and cons of each option.
The Pros of Putting Down 20%
When you put down 20%, you’re more likely to secure a loan from reputable lenders with a lower interest rate. By putting down 20%, the lender then knows that in the worst-case scenario, they only need to recoup 80% of the home’s value should the borrower fail to pay the loan back. Since you’ve paid more up front, your monthly mortgage payment will be smaller.
Why Less Can Sometimes Be More
Usually, the minimum that you must put down to secure a 30-year mortgage is 3.5%. This is quite a bit less than 20% and will save you some money up front before the mortgage starts. By putting down less initially, you will be able to move into your new home sooner than later without having to spend months or years trying to scrape together the funds for a traditional 20% down payment.
You don’t need to shell out the big bucks to secure a mortgage loan, however, the more you put down up front, the less you’ll have to pay over time. Consider both of the options carefully, and do your research and crunch the numbers before signing any paperwork.
If you’d like to talk about selling your house in Virginia, Maryland, or Washington DC so you can buy another one, head over to our Contact page.
When it comes time to purchase a house in Maryland, Virginia, Washington DC, or Baltimore, buyers have a lot of options. Some of the most commonly compared housing options comes down to condominiums versus single-family houses right now.
Aside from location, housing type is one of the most important decisions for an individual or family to make. It’s important to sit back and really consider the unique pros and cons that accompany condos and single family homes today, as they could make or break your living experience. By focusing on lifestyle and cost, you can better determine which is right for you.
PROS: In recent years, there has been a huge upswing in condo purchases over homes due to a resurgence in urban living. Condos are most typically located in urban areas, with walkability to shops, restaurants, and other places of interest and entertainment. Condos come with resort-like amenities, including pools and fitness centers, cleaning services, and 24-7 support. Especially with people living busier lives today, condos offer a convenient solution to a low-maintenance lifestyle.
CONS: As you could guess, this kind of convenience plus luxury amenities does not come at a cheap cost. One major drawback to the condo life is association fees, collected outside the monthly mortgage payment and put towards building maintenance and amenities. These fees can be expensive, and they can increase at any time when extra money is needed. Additionally, condos mean you’re sharing a building with other homeowners, presenting a potential for noise and other disturbance complaints.
Single Family Home
PROS: The best advantage of buying a single-family home is that you have total control over the property. It is all yours. You can remodel, make changes, and do whatever your heart desires without the consent of others. Homes also allow for extra indoor and outdoor space, providing you with much more wiggle room than a condo. Accommodating for families and pets, your home can expand with your family, equipped with closets, attics, basements, and garages. Lastly, homes offer you more privacy, placing outdoor space between you and your neighbors.
CONS: Homeownership is tough work, however. As part of the privacy and personal control perk, you are completely responsible for maintenance inside and outside the property, including upkeep of the yard and trees. You also need to factor in buying equipment and tools for the maintenance when purchasing a home, as well as the service costs for bringing in professionals to make repairs. Finally, utility bills with homes are much higher than condos, as you have to heat/cool and power up much more space than that of a condominium.
What’s Right For You?
If you’re single, looking for an urban setting and working long hours at work, a condo might seem appealing. However, if you’re newly married, looking to start a family and add personal touches to your living space, then consider the single-family home option.
Purchasing a house is one of the largest investments a person makes in his or her life. Most people don’t fully understand the home buying/selling process. Every house transaction involves a title company that handles the actual transfer of the house. Title companies vary in quality, price, and experience. You have the right to choose your own title company. Most people don’t take advantage of this right. Choosing the wrong title company could cost you more money and title issues down the road. Here are some factors you should consider when choosing a title company in Maryland, Virginia, or Washington DC:
Reputation and Experience
Undoubtedly, you would want your work to be handled by a reputable and trustworthy company, especially if you want to sell my house fast in Maryland or Washington DC. Thus, it is essential that you check the reputation and track record of the company you are considering. Check online reviews and ask a few realtors if they have experience with the company. Call the company and ask them questions about their process.
Choosing a title company near you is helpful if you need to discuss issues in person, drop off checks, etc. If you close at their office, having it near by will make your life easier.
House transactions are very expensive. The last thing you want to do is waste money on title fees when you are trying to sell my house fast in Maryland, Virginia, or Washington DC. Ask the company about their fees and force them to provide estimates. Check around with other companies and compare prices. You could end up saving thousands of dollars.
As always, at 8 Day Home Sale we buy houses in Maryland, Virginia, and Washington DC for cash. We have years of experience buying houses and working with title companies. If you sell your house to us, you can rest assured we will handle all title issues.
Real estate is believed to be among one of the top 3 long term investments in the United States, coming only second place to stocks and ranking better than gold. In some economies particularly those in Europe, real estate is ranked highest in stable returns for any investment.
But where does the value of real estate come from? Do you just buy a house haphazardly or are there strategies? When you think of real estate investing, most people make it sound easy. House flipping shows have glamorized real estate, portraying many falsehoods and leaving out pitfalls. In terms of primary residences, many people believe any house they buy will go up in value no matter what. Buying houses should be taken as seriously as all other forms of investing.
Here are some tips for buying a house in Maryland or Washington DC that will appreciate in value:
1. Check your location
Let’s say you see a nice property that is really affordable and is selling at a lower price than the usual market price, it wouldn’t be a wise decision to just go straight ahead and buy the property before doing your research. Go to the local board and look for the plan of the neighborhood. If there is going to be an industrial area or even a land dump close by, the value of that particular property will drastically decrease.
2. Unusually High Houses for Sale
Unless a neighborhood is in its initial development stages, you should be wary of acquiring a property if more than five other houses in the area are for sale. People might be running away from that neighborhood for some a reason. Zillow is a great resource for this.
What facilities are in the area where you want to purchase property? The three facilities which are a must and will have a positive impact on the overall value of your house are schools, medical centers and shopping malls. If an area does not have these three or any plans indicating that these will be there soon, then it’s not a wise idea for you to get a property in such an area.
4. Fixer uppers are the best
Houses that will require work are usually the best investment. You can buy a house and get a 203K loan for renovations. This will usually lead to $30,000+ in instant equity.
If you are looking to sell your house fast for cash in Maryland and move, you will need to decide whether you want to buy a new house build or a previously occupied house. Here are some pros and cons:
Arguably the best part of buying a new home is the fact you are starting with a clean slate. No one has put their personal stamp on the home, and it really is a blank canvas for you to paint and enjoy. The home will reflect your personality and taste in no time. If you are buying before it is finished, you also have the opportunity to customize everything.
With a new build there is no waiting around for anyone else to finish dealings (e.g. title and loan issues) with their property so proceedings can move a lot faster. This can be countered however by any building works that take longer than expected.
A con with new builds is resale value. Often times comps haven’t been established so resale value is somewhat unknown.
Most new build are now fitted with new products and finishings. New products especially appliances are safer, last longer, and are more energy efficient.
Most new build properties come with warranties for around 10 years. This is something unique to new builds and really does remove the potential headache that comes with the uncertainty of buying an older property.
The neighborhood is also something you can get more knowledge of in an older property. There is more information available about the standard of the surrounding area. Sometimes with new builds you are not sure on the reputation of the area for years. Schools in the area are often new so it can take time to find out how well they perform also.
The biggest con for new builds is price. New houses cost much more than older ones. Also, closing costs can be substantially higher.
Hopefully this information helps you make the best decision. If you need to sell your house fast for cash, let 8 Day Home Sale help.