Condos may be a good fit for first-time homebebuyers

BUYING your first home is an exciting life milestone, and is certainly one that doesn’t happen without research. Chances are your days have already been filled with a lot of reading about — and viewing — the places that could become your potential home.

While you’re looking, it’s important to highlight a new trend in property ownership, one that could influence your first-home purchase: the rise of a vibrant condo market. This is especially prominent in large cities, such as Las Vegas, ripe with new and exciting residential opportunities located far from the suburban sprawl.

Today’s condo market

Annual information published by the National Association of Realtors found that 82 percent of first-time homebuyers are still opting for detached single-family homes. That’s followed by townhouses, with condo sales making up just 3 percent of total first-time home purchases. Yet, condo purchases provide something valuable that detached single-family homes often cannot: They’re located in urban areas with ample access to commercial and recreational facilities, workplaces, public transportation, and more — not to mention the wealth of amenities that typically accompany them.

Historically, detached single-family homes have been the property type that appreciates the fastest — providing the most payback for buyers who eventually decide to sell and upgrade. This was driven by buyer demand. Nowadays, market trends suggest a shift, especially in the country’s 100 largest metropolitan areas. According to five-year data collected until February 2017, the median appreciation rate of condos rose by 38.4 percent, while the value of detached single-family homes climbed by just 27.9 percent.

The increasing market value of condos is an upward trend, and the sooner you can cash in on this appreciation, the better it will be for your wallet today, and in the future.

When it comes to interest in the condo market, Las Vegas real estate is continuing to see recovery following the Great Recession. Between 2015 and 2016, the condo market experienced a growth of 14.5 percent — a difference in nearly 100 condo sales. The luxury condo marketing is booming. With the Vegas market showing similar appreciation trends as those mentioned earlier, now is the time to consider buying.

Las Vegas condos cost less

While the value of condos is outpacing the growth of single-family homes, the prices are still lower — for now.

On its profile of Las Vegas properties, single-family homes clocked in at a median value of $241,000, while the cost of condos sat at a median of $123,000 for this year. That is a substantial difference of $13 per square foot. It is important to note that while the cost of condos is lower than that of detached homes, the down payment can be higher. When buying your first home, shopping around for the right mortgage is just as important as the property hunt.

A higher ease of living

The reasons to purchase a condo as your first home extend beyond benefits to your wallet. For one, first-time home ownership can be stressful, and it is exponentially less complicated to manage a condo than a single-family home. The National Association of Real Estate found that 74 percent of first-time home buyers had rented previously. Most rental environments offered the luxury of little responsibility — issues such as renovations, troubleshooting, and maintenance would be handled by a landlord or property manager. In the excitement of buying a detached home, some first-time buyers can forget that these previously managed issues become your sole responsibility.

Condos make for the perfect transition between the rental market and the huge responsibility that comes with owning a detached home. As a condo owner, you will never have to worry about landscaping a garden, repairing a window, or finding a security company.

While there are condo association fees that cover these responsibilities, many find that cost much lower than the time and effort it would take to figure out the logistics for themselves. Plus, most condos have physical fitness areas, swimming pools, and indoor parking.

When looking at condos on the market, be sure to learn the details of the homeowner’s association, or HOA. More than a third of all residential properties in the state are part of an HOA, and each has slightly different powers, regulations, and fees.

The Las Vegas condo market is in the perfect state of buyer balance: low purchase prices and high rates of appreciation.