Photo by Agustin Lara on Unsplash
Michaela Phillips, Synergy One Lending
If you’re interested in purchasing property, there are several reasons to consider opting for a condo unit rather than a single-family home. While condos can be an excellent choice for many households, it’s important to note that government-sponsored enterprises Fannie Mae and Freddie Mac have recently added an addendum requirement for an extra layer of protection. If you’re thinking about becoming a condo owner, I discuss the advantages here, as well as the reasoning behind the new addendum.
The benefits of purchasing a condo
With a nationwide shortage of detached single-family homes, it can be challenging to find the perfect property. If you’re ready to proceed in your search, a condominium unit may be an option to consider. Condos offer a host of advantages, including:
• Luxury amenities
• Minimal upkeep
• Better security
• Proximity to city life
What you need to know about the addendum
If the perks of condo ownership have piqued your interest, there are some details about Fannie and Freddie’s new addendum that you should know. Prior to closing on your unit, your lender must obtain a condominium project questionnaire with information provided by a representative of the Homeowner’s Association. The questionnaire seeks answers regarding the building’s structural soundness and safety, and can be viewed here.
Although the official reasoning for this new documentation hasn’t been specified, it’s likely to protect the enterprises from instances like the Champlain Towers collapse in Surfside, Florida. In June 2021, the 40-year-old condo community collapsed, causing 98 deaths and $1 billion in property damage. The cause is still under investigation, but a 2018 report suggests that the building was subjected to years of water leaks and corrosive effects from salty air. With this tragedy still fresh in the minds of many, it’s no surprise that the enterprises need to ensure that condos are well-maintained before purchasing mortgages.
With traditional homes in high demand and short supply, condominiums may be the preferable option for those seeking high-end amenities and minimal maintenance.
By Michaela Phillips. Michaela is the Senior Lender for Synergy One Lending in Boulder. She enjoys teaching her clients the pros and cons of being a Real Estate Investor.
Contact Michaela at 303.579.5517, e-mail [email protected] or visit michaelaphillips.com. NMLS: 312874.
