Bigger isn’t always better in Austin, Texas, especially when it comes to condos. As the market continues to heat up, buyers are realizing that having a low-maintenance downtown property with less square footage relieves the hassles of traffic and some of the financial responsibilities of a single-family home.
“Owning a condo is a great option. A lot of what we talk about in Texas, which is a new urban condo market, is the fact that bigger isn’t best. People are realizing they don’t need giant square footages to get a great quality of life,” says Trey Phillips, Realtor and on-site sales specialist for Moreland Properties.
However, before you make an offer, you need to perform your due diligence to ensure it’s a sound investment. U.S. News spoke with some of Austin’s top real estate agents, as identified by real estate technology company Agent Explore (a U.S. News partner), about what buyers need to know before they sign on the dotted line.
Hire a specialist.
“Buyers need to hire a specialist, somebody who deals with condos and has certifications in it. You have to know what you’re doing when it comes to condos and know the right questions to ask,” says Betty Epperson, broker and owner of Epperson Realty Group.
[Read: 5 Things to Do Now Before Selling Your House in Austin This Spring.]
Because every homeowners association has different rules and responsibilities, like maintaining the building and common areas like a workout room or pool, you need a real estate agent working on your behalf. An agent who understands the idiosyncrasies of condos will know to ask for critical documents and information, such as the homeowners association meeting minutes and budget, insurance coverage the unit should have, condo resale certificates and disclosures about your fees.
Assess the amenities.
Spend time reviewing each building’s perks to determine if it’s a fit for your lifestyle. How easy is it to find a parking space, or are they assigned? What are the hours and rules for the fitness center and pool? Is there a dog walking area and are cleanup stations provided? How well-kept are the shared spaces?
Austin is on the verge of becoming a city where people work (and play) at all hours, so Phillips suggests considering a condo community with a 24-hour desk presence and club room. “Austin is a tech-driven city and people work from anywhere. Having a common space that a resident can work from in their building that’s vibrant but private enough to concentrate allows them to benefit from the communal aspect of a condo,” he says.
Check out the neighborhood.
By simply driving around the area, you can see what’s nearby and learn how long it takes to get to the places you frequent. Seeing the development at morning, noon, night and the weekends also sheds light on the neighborhood’s vibe.
[Read: 5 Things to Know About Selling a Home in Austin.]
Epperson recommends figuring out if your development is affected by outside noises like rallies, traffic or a school announcement system. Condos tend to be in more commercial areas, so it’s important to know what to expect ahead of time.
Thorough research can help separate the right building and area from the pack, and make you more confident you made the right choice.
Analyze the homeowners association meeting minutes and regulations.
Collecting the homeowners association meeting minutes allows you to see exactly how the community is run. “You need to know how healthy their budget is and the overall financial stability. Also, is a huge repair assessment coming up? What type of upkeep is happening? These can lead to big expenditures after you purchase a property,” Epperson says.
Reading the homeowners association regulation documents your agent provides is also critical. They will lay out the development’s rules concerning renting or pets, and make clear whether it has a fitness center, pool or other amenities. Raise any questions you have with your real estate agent and get them answered prior to closing.
Review the rental-to-owner-occupied ratio.
It’s critical to know how many units are rented versus unoccupied or owner-occupied — it can make a difference if you’re considering a loan. The easiest way to find out is by using the condominium questionnaires. They’re forms the homeowners association fills out for different lenders that help determine how readily it would qualify for a loan. Knowing the renter-to-owner ratio (which the association must report on its forms) can give you a sense of your own ability to get a loan or a competitive interest rate.
[Read: 100 Best Places to Live in the USA.]
“Any building that has more than half of its units occupied by tenants is not going to be considered warrantable by the government,” Phillips says. “On new construction, you need to look at the developer documentation for what the rental limits are.”
New construction versus old construction.
When you’re evaluating whether to buy a condo in a brand-new building, “you want to look at the backbone of the project, which is the developer and the financing,” Phillips says. Then, he says to look at the building’s immediate neighborhood, amenities and culture.
For existing developments, examine the building’s condition. Ask yourself if the homeowners association is doing a good job of maintaining the building.
Looking for a real estate agent in Austin? U.S. News’ Find an Agent tool can match you with the person who’s most qualified for the job.
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6 Things to Know About Buying a Condo in Austin originally appeared on usnews.com
