Considerations When Deciding to Buy a Condo or Single Family Home in Canada

Those in the market to buy a dwelling in Canada for personal use or as an investment property often want to know whether a condo or a single family home is the smartest choice. While both can be comfortable and wise investments overall, here are a few things that potential buyers should consider beforehand.

Explore Current Pricing Fluctuations

Markets can rise, stay steady or suddenly fall. Many investors and homeowners may remember the period of 1990–1996 when home and condo prices in Toronto dropped annually before stabilizing. While real estate prices have primarily recovered, one must pay attention to the market conditions when buying a home or condo, as their valuations and markets typically differ.

A historical example of fluctuating home and condo market conditions can be seen in statistics from February 2017 citing that the year-over-year national average cost of a one-story home rose by 15 percent, two-story single family homes by 17.9 percent and condominium and townhouse prices increased by 16 percent. However, these rates will vary between localities and provinces.

Understand Local Home Markets

Let's take those February 2017 statistics and explore the local home market fluctuation values in a few Canadian territories and cities. At that time, prices were up 9.5 percent in Calgary, 6 percent in Greater Vancouver and 8.3 percent in Greater Toronto according year-over-year calculations. What potential and buyers need to understand is that these appreciations—just like depreciation—in home values rely heavily on economic and logistical factors.

For example, many real estate experts believe that Toronto and Vancouver rates soared due to limited space and a high level of desirability with buyers. However, the Calgary rate increases are likely due to their steady oil economy, but when oil prices fall a crash in local real estate is possible. Know the local markets for both single family homes and condos in Sagewood, or elsewhere, to prevent get caught up buying one in a market that could end up falling flat.

Condos Versus Homes Concerning Neighbourhood Conditions

Home buyers who plan on living amid their new residence as opposed to renting or leasing it should consider a few possible conditions including:

• Condos are sometimes bought and rented as investment properties, meaning that one could have new neighbours every few months or years.
• Condominium complexes are often connected units that may become noisy depending on the current residents in connected dwellings.
• Single family homes can also be rented, but individuals in such abodes are likely to stay longer than condo renters.

Ultimately, whether these are pros or cons depend upon the desire of the purchaser who may or may not mind new neighbours. While neighbours are a big consideration whenever one looks to buy a home, there are as well others.

HOA Considerations and Amenities

It's typical for condos and townhouses with full ownership options to have a dedicated condominium homeowners association (HOA). This group plans and implements budgeting, landscaping, amenities and arranges repairs within the common areas of the community. They also collect HOA fees that cover these costs in addition to allowing them to enforce strict covenants, restrictions and conditions as set forth in the community guidelines. There may also be occasional assessment fees to help the HOA make more costly repairs such as sewage and drains that effect the entire community.

However, HOA groups are also common in single family home communities, so buyers want to ensure they are aware of any fees, assessments and community regulations before investing. One of the most desirable aspects of HOAs whether in a home or condo is that these organizations typically also cover maintaining and repairs for amenities such as pools, spas, tennis courts, exercise rooms etc. within the community.

Trying to decide between a single family home or a condo to purchase? Contact a local real estate professional in Canada to learn more about making the perfect choice.