Apartment vs. Condo: What’s the Difference – 2020 Guide
Differences between the house and an apartment are obvious, but many people can’t distinguish between condominiums and apartments. Although, when looked from the financial point of view there are few, in many other things there are major distinctions. Let’s take a look at each one.
An apartment is a residential unit located in the building or a building complex. It’s usually owned by big real estate companies that manage the units and a building as a whole. Seldomly units are rented by an individual. To move in you would need to sign a lease agreement that bounds you to pay rent for the next 12 months at least. Some apartments are furnished, while others come empty. Further, some units have utilities included in the price of the rent, and in others, you’ll have some additional cost of electricity and heating.
A condominium, or “condo”, is also a residential unit within the building complex. You can rent a condo from the owner or a real estate company that owns it, or you can buy it from the owner or the developer. Condominiums have additional expenses called HOA, which stand for Homeowner’s Association, which manages the building common areas like halls, garbage disposal, elevators, etc. It also enforces rules of the building regarding pets, noise level, and so on.
Ownership is the most distinctive difference between the two units. An apartment is owned by a large company or an individual, your landlord, that makes its profits from renting the residential units. A condominium is owned by a developer, a real estate corporation or an individual. A building complex made of condos is managed by HOA if owned by a company, or by your landlord who is the owner of the unit. Condominiums can be rented, while it’s illegal to double-rent the apartments. Condos can also be sold or bought, as where apartments are not in your possession thus, you are allowed to live in them as long as you pay the rent.
Condominium buildings are managed by HOA. This is a non-profit organization made out of volunteers. Every condo owner is automatically joining the HOA and has a saying in how the building is managed if he chooses so. Oftentimes, tenants are too busy to keep track of the building maintenance, so they usually agree to hire a company that will do it instead. There is a fee attached to it and, depending on the zip code, can go well into lower hundreds.
In apartments, the building is managed by the landlord or by a company that is the owner of the building. You would have no say in how the building is managed or changing the policies and rules.
Rent for an apartment and a mortgage for a condo come up to about the same. That’s not the issue here. However, there are additional costs when owning the condo, like HOA fees and utilities that can add up quickly. HOA is like a small government withing the building complex that, for a fee, manages all common areas and takes care of any problems that might arise in the building and its surroundings. When renting an apartment, utilities are often included, and there are no additional fees for the building maintenance. The owner of the unit or the whole building is responsible for any repairs and fees.
Obeying the rules
In ana apartment building rules and regulations are made by the owner or landlord. Breaking any rules will lead to hefty fines or even the eviction. In condominium buildings rules are set up by HOA, and for not obeying them you will be fined too, with the only difference that no one can kick you out of the unit since you’re the owner.
Apartment buildings are usually equipped with standard amenities. It often includes free parking, pool, gym, and parks around the complex. Amenities are the same for everyone and every tenant is free to use them as they’re pleased as long as he sticks to the rules. Condominium complexes are what you can find in an apartment building and more. Developers, in order to get higher profits, pay special attention to common areas. The condo building will look more luxurious from the inside and out, and units usually have some additional perks like granite countertops and high-end appliances. For some exclusive condominiums with luxury features like the ones mentioned, visit CondoWizard.
Apartments can be renovated as long as you don’t change the outer appearance of the building, while condo owners need to seek approval from the HOA board for any updates. HOA usually denies such requests.
Apartment tenants have no responsibility when it comes to repairing their units. Whatever the problem, the building owner has to take care of any fees. Some complexes have 24/7 services available so that tenants don’t have to wait for any emergency repairs. Condominium owners bear the responsibility and the cost of any and every repair that occurs. They are completely left to take care of everything inside their units. If you rent a condo from the owner, chances are, they are not going to reply to you in days or even weeks. Some building complexes tried to solve this issue by implementing software that immediately alerts the owners about the problems in their unit. Others are still counting on paper and pen, and that’s where most problems begin. It takes forever to communicate the problem to the owner, then for him to find the repair shop, then communicate back to you. Aligning everyone’s schedules is almost impossible, and the only ones who suffer are tenants.
When deciding on which place to call your home you must be aware of all the advantages and disadvantages. To be an owner of the building unit is certainly appealing, but it does come with a cost. Many, many costs. On the other hand, when living in an apartment you will only pay rent and not worry about anything, but you’ll not own anything. So, some folks see condo as an investment while others prefer the freedom of living in an apartment.