What You Need to Know About Renting a Condo

Are you in the market for a condo rental, but not sure where to begin?

Don’t worry; the Luxury Living Team has made it easy by breaking down everything you need to know before signing the lease and renting a condo.

How Much Does a Condo Cost Per Month?

Chicago offers a wide variety of condo options for potential renters with different preferences and different budgets.

While the cost of a condo in the Windy City may vary drastically depending on factors such as location, build, and amenities, currently the average price for a rental in Chicago is $1,878. A one bedroom runs around $1,701 on average per month, while you can find two-bedrooms close to $2,135.

Among all of the Chicago neighborhoods, River North and River West remain the most expensive spots to rent.

While buying a condo may be the smartest long-term investment, there are more costs associated with purchasing a condo vs. renting.

When you purchase a condo, there are up-front costs that renters never have to worry about, such as a downpayment, bank and title fees, and closing costs. Condo owners are also responsible for maintenance and repair expenses that may arise.

Renters, on the other hand, are solely responsible for the first and last month’s rent up-front and occasionally an additional security deposit, depending on the rental agreement.

To ensure you find a condo in your price range, it is helpful to narrow down a neighborhood that falls into your budget. Finding an experienced leasing agent can also streamline the process and be sure to find you the perfect fit.

Should You Rent or Buy a Condo?

Are you still wrestling with the decision whether to rent or buy a condo?

The truth is there is no black and white answer, and it depends entirely on each buyer’s current financial state and long-term goals.

If you want to avoid higher out-of-pocket costs and want more freedom to pick up and go, then renting a condo may be your wisest choice.

However, if you are ready to make a long-term investment and build equity, consider purchasing a condo.

Homeowners also often take advantage of tax breaks that renters don’t get. The interest that you pay on the purchase of a condo is deductible on your federal income tax, with some limitations.

Additionally, owning a condo provides the ability to customize your unit. Since it is your property, you get to make the majority of design and renovation choices, as long as they follow HOA guidelines.

While owning a condo comes with perks, keep in mind that it also comes with the extra responsibility of maintaining the space. Renters, on the other hand, don’t have to deal with managing repairs or renovations directly. Those issues are reported to and addressed by the landlord.

How to: Rent a Condo

So you decided it’s time to rent a condo. Here’s a list of some common steps to prepare for:

  1. View properties: Before committing to a condo, make sure you inspect multiple options to find the best fit for you. It is crucial that you see the listings for yourself to ensure they meet your needs and expectations before signing the lease.
  2. Rental Application: Filling out an application is a standard procedure so that the landlord can determine your credibility as a potential renter. The application often asks for basic personal information, employment and income information, personal references, and background information. You may also have to submit an application fee and security deposit. If the application is denied, the security deposit will be returned to you within a specific time frame.
  3. The Lease: If your background check clears and the landlord approves your application then the next step is signing the lease or rental agreement to make the arrangements official. If you are sharing your condo with roommates, each tenant will need to co-sign the lease.  Often the leaser will also need to return the lease to the landlord with the first and last month’s rent.
  4. Utilities: The terms of the lease specify which utilities you are responsible for and which are covered by the landlord. For the utilities that fall under your responsibility, it is important to find an independent provider to set up these extra services, such as cable and electricity.
  5. Paying Rent: Once you’ve signed the lease, the space is yours, as long as you keep up with your monthly rent. Depending on the landlord’s preference you may submit payments online, through an app, or by check.

How to Get Condo Board Approval for Renters

As a condo owner, there is often the possibility of renting out your property. However, before a potential renter can move in, they must first receive approval from the condo homeowner association (HOA).

If you are interested in renting out your condo, it is critical first to examine your HOA’s governing documents.

If you discover that your board prohibits rentals is there any way around these restrictions? The answer is possibly. You can attend an HOA meeting and take the propose the idea to your board.

While the approval process may vary from condo to condo, many associations often require that prospective tenants submit pages and pages of paperwork, undergo background and credit checks, and pay application fees.

All of these requirements are in place so that the board knows who will be living in their shared building and to ensure the tenants have a reputable past. Also, many associations regulate the number of rentals within a single building.

There is a perception that renters may not take care of their units to the same standard as owners. So having a strict rental policy in place is a smart preventative measure to avoid negligent renters.

How Does Co-op Rental Work?

With a growing interest in cooperatives (co-ops), you may also want to consider looking into these types of rentals. However, be aware that renting or subletting a co-op is often a complex process with strict guidelines.

The main difference between condos and co-ops is the type of ownership.  Companies, rather than individuals, own cooperatives. This means that rather than acquiring the title to the physical unit, the buyer purchases shares of the company. A shareholder of the company is then entitled to a proprietary lease, giving him or her the right to occupy a specific unit.

Cooperatives still have a board, similar to a condo. It is up to the co-op board to determine whether tenants/shareholders are permitted to rent out their units. If the policy does allow for rentals, potential tenants must go through this board before approval to rent a unit.

While the co-op rental process resembles that of a condo unit, it tends to be more difficult. On top of the list of requirements that applicants must present the board, potential renters have to go through an extensive application and interview process. A lengthy in-person interview is almost always required for co-op rentals for the board to get a clear idea of the individual potentially joining their community.

Despite co-op rentals being limited, you can still find an assortment of options in the city. Cooperative Communities of Chicago is a great place to start and learn a bit more about cooperative living in the Windy City. Then when you are ready to find a rental of your own, working with an experienced broker or leasing agent will help streamline the process.

Contact the Luxury Living team today to help you find the perfect condo or co-op rental!

Finding a New Home: Why Buy a Condo?

If you are not ready to commit to a single-family house in the suburbs, but looking to build equity in an urban city instead, consider investing in a condominium.

We are here to share all the perks of owning your own property and help answer the question, ‘why buy a condo?’

Why Buying a Condo is Better Than Renting an Apartment

Owning a condo opens up opportunities that you can’t find with an apartment rental. Not only does the purchase provide a long-term investment, but condo owners also have more freedom and control, as well as a greater sense of community.

When a buyer purchases a condo, they automatically become a member of the homeowner association. This membership offers a great chance for residents to interact with other community members to strengthen relations and discuss community matters.

Homeowner associations also promote self-governance. This means that owners have the final say in the rules and regulations that community members must abide by, unlike apartment residents who have no say in the property expectations.

Overall, most condo residents also have a high level of control over their property. While rules and regulations vary from condo to condo, most provide owners with a large amount freedom over their interior unit. This also means the ability for owners to customize their space. Unlike apartment residents, those living in a condo can manage interior renovations and pick what appliances they want.

Benefits of a Long-Term Investment

Rather than writing a monthly check to your landlord, and having no equity to show for your payments,  consider putting your money towards an investment.

While you may initially spend less renting an apartment, there are plenty of long-term financial benefits that come with owning a condo.

Appreciation and tax benefits are two major incentives to a condo purchase. As a home appreciates, it accrues faster than a stock might because you get the appreciation on the entire home’s value, not just the gain your down payment cash invested. Also, homeowners are allowed to deduct mortgage interest and property taxes when they file tax returns each year.

Additionally, owning a house ensure more financial consistency. If you obtain a fixed-rate mortgage, your mortgage is guaranteed to remain the same, while rent costs around you may be on the rise.

How to Find the Right Condo for You

When searching for the dream condo, it is critical to find a home that fits all of the essential criteria.

This may involve an extensive search, especially with the abundance of options Chicago has to offer. However, finding an experienced broker can streamline the process. A broker can offer valuable knowledge of the area and compile options that provide everything you are looking for in a condo.

Instead of asking yourself ‘why buy a condo’ it is now time to determine ‘what condo should I buy?’

Treat Yourself to These Luxury Condo Amenities

With an increased demand for luxury amenities, Chicago has stepped up its game.

Throughout the city, you can be sure to find an impressive array of luxury condo amenities that will easily incentivize any prospective homeowner.

Unique Luxury Amenities You’ll Find in Chicago

The Windy City is the ideal spot to find your dream condominium boasting a wide selection of luxury condo amenities.

Many condominiums have incorporated amenities that provide technology and connectivity and holistic wellness yo keep up with growing trends.

Research confirms that buyers in the market for a new condo are seeking technological features. Therefore luxury condominiums are quick to impress with amenities including robotic platforms and electric vehicle charging stations, as well as smart-home technology in units that allow homeowners to control lighting, temperature, and electronics from a smartphone or device even while they are away from home.

While community gyms are not rare in condominiums, luxury Chicago condominiums have taken fitness centers to the next level. Many condos have added state-of-the-art technology in their gyms, along with additional space for yoga, meditation, and massage centers.

Additionally, you can find condos complete with sky lounges, wine storage and tasting rooms, outdoor pool terraces, theater rooms, children’s playrooms, and demonstration kitchens. The list goes on.

How to Find the Amenities You Want

The first step to ensuring that the condo you chose offers all of the amenities your heart desires is research. Look into the different amenities on the market and compile a list of your mandatories and desired condo features.

While putting together a list of your must-haves, make sure to also look into the average costs of specific amenities. While these extra features may not be included in the listing price of the condo, they often increase the annual or monthly HOA fees.

From there, connect with an experienced broker to help narrow down options that fit your criteria. Brokers can help streamline the process and ensure that you find the ideal condo.

Why You Won’t Find These Amenities in an Apartment

The list of impressive amenities is unique to condominiums. While apartments may feature more basic amenities, such as a fitness center and community pool, it is less common for these properties to offer luxury features.

Top-notch amenities are often unique to condos because, unlike apartments, condominiums can fund additional amenities through HOA fees that each unit owner is obligated to pay.

Furthermore, since purchasing a condo is an investment, high-end and exclusive amenities can help to raise property values and incentivize potential buyers.

With all of the luxury condo amenities that Chicago has to offer, start your search for the perfect condominium today!

Everything You Need to Know About Condo Living

There are plenty of perks to owning your own condo. Along with opening up the opportunity for a wise investment, purchasing a condominium also provides the opportunities for close-knit communities and incredible freedom.

See for yourself why condo living is so hard to beat.

What Condo Communities are Like

When you purchase a condo, you are investing not only in an individual unit but also a terrific community.

Condo homeowner associations, in particular, provide residents with a phenomenal opportunity to get to know the neighbors. Every unit owner is an automatic member of this association and therefore is invited to attend regular meetings to discuss community matters and get to know one another.

Community amenities also open the door for residents to cross paths. Many condos feature common spaces, such as fitness centers, pools, and resident lounges, which are open to any unit-owner or renter.

What you Have Control Over in a Condo

Overall, residents have a high level of control over their condo if they are the owners of their unit.

As long as unit owners abide by the rules set in place by their homeowner association, owners tend to have a fair amount of control over their interior unit. This involves the ability for owners to customize their space and manage renovation projects.

The HOA is then responsible for managing the exterior and common elements of the unit, such as hallways and lobbies.

How Condos Provide More Freedom Than Apartments

Apartment residents lease their units from a company or person, which significantly restricts the freedom one has when it comes to what they are allowed to do within their home.

Apartment companies tend to implement stricter regulations, leaving residents with a lot less opportunity for personalization within their units. The company has the final say in most of the renovation and design decisions and often tend to feature more uniform apartment units.

Apartment companies also realize that renters may be less inclined to take care of their units because it is not legally their property. Most buildings will enforce fines or penalties if rules are broken or ignored to encourage residents to maintain their leased units.

Condos, on the other hand, are independently owned, giving unit-owners much more independence. The only rules that condo owners are required to follow are those set in place by the homeowners association through the codes, covenants, and restrictions (CC&Rs), which can be found in the governing documents.

While some of these rules pertain to the interior units, they tend to be less restrictive than those set in place by apartment buildings. Also, since the members of condo HOA’s are the residents themselves, the rules are agreed up and set in place to protect the curb appeal of the community and maintain property value.

Condo living opens the door to great community and freedom! Start your hunt today and become an owner of your own condominium.

What’s the Difference Between Apartment and Condo Amenities?

In both apartments and condominiums, amenities help to enhance the property value and community appeal.

While both housing options feature their own unique amenities, the list of condo amenities tends to out-shine that of apartment buildings.

Common Apartment and Condo Amenities

First, let’s break down the main difference between apartments and condos. While a condominium is a collection of units owned individually, apartments feature units within a single building that are owned by one person or company and rented out to individuals.

While there the list of amenities among different apartments and condos, there are standard amenities, both in individual units and communities, that are worth noting.

Washers and dryers remain the most common amenities found within individual residential units, for both condos and apartments. It is also typical for units to boast high-end appliances and hardwood floors. Research studies also reveal that a large percentage of residents are willing to pay a premium for granite countertops and balconies within their unit.

Regarding community amenities, condos and apartments frequently offer a fitness center, pool, and clubhouses. Common spaces for socializing and outdoor space are also common to find in both communities and have been proven to add value to many residents.

What You’ll See in Condos That You Won’t See in Apartments

Many house hunters find themselves drawn to condominiums because of the impressive amenities offered.

Since condos are designed to attract owners rather than temporary tenants, there is more of an incentive to feature more attractive amenities in both the community and individual units. These upgrades add value to the property and ensure a more promising investment.

On the list of luxury condo amenities, you are likely to find valet-service, coffee shops, concierge, spas, impressive rooftops, and more. Individual units may also boast high-end appliances, incredible spaces, and the latest tech-savvy features. While these amenities are tempting for any buyer, it is critical to keep in mind that these features always increase the costs owners and renters end up spending.

To fund these extra amenities, condo owners are obligated to pay monthly dues that go straight to the homeowners association. Therefore, it is essential to figure out exactly how much these luxurious amenities will run a condo owner’s HOA fees before moving forward with a purchase.

How to Find Condos With the Amenities You Want

If you have a good idea of the amenities that you are looking for, then you may be ready to begin the search for the perfect condo.

With so many condo options in Chicago, it is highly likely that you can find a condo that offers all of your desired amenities and more.

Filter through the array of options in Downtown Chicago to narrow down your ideal property with the perfect condo amenities. You can also find an experienced broker today to help make the selection process less intimidating!

Are Condos Cheaper Than Apartments?

If you are looking into whether condos are cheaper than apartments, the answer may not be as simple as yes or no.

To determine which property makes the most sense for you, let’s examine the financial differences between owning a condo and renting an apartment.

Is a Condo or Apartment a Better Financial Choice?

If you are considering purchasing your own condo, expect to pay much higher up-front costs than if you choose to rent an apartment. However, don’t let these expenses scare you away.

When first renting an apartment, residents are often required to cover the first month’s rent along with a security deposit. Purchasing a condo, on the other hand, generally requires a sizeable downpayment. It may also require additional expenses, such as closing costs or lawyer fees.

On top of these up-front costs, condos also require monthly or annual homeowner association (HOA) dues. While HOA membership may increase owners’ out-of-pocket expenses, HOA helps to maintain the community and improve the value of the properties.

Weighing Costs Over the Long Run

When examining the costs of renting an apartment versus owning a condo over the long run, it is evident that a condo purchase is a wiser financial move.

While monthly rental costs are subject to increase over time, a fixed mortgage rate will ensure that your mortgage stays the same over time, regardless of fluctuation in the housing market.

Also, once you pay off your condo, the monthly mortgage costs halt, and the property is officially yours. However, regardless of how long you live in an apartment, those monthly rental costs are perpetual.

Appreciation and tax benefits are two additional incentives to a condo purchase. As a home appreciates, it accrues faster than a stock might because you get the appreciation on the entire home’s value, not just the gain your down payment cash invested. Also, homeowners are allowed to deduct mortgage interest and property taxes when they file tax returns each year.

Which is the Better Investment

If you have the credit or money-up-front to purchase a condo, then you have an opportunity to make a better investment than renting an apartment.

Unlike apartment rental payments, condo mortgage payments and initial costs are going towards a personal investment. So in the long-run, condo owners will have accumulated equity to show for the expenses.

As an apartment renter, when you write that monthly check to your landlord, you are paying for temporary occupancy without any ownership. While renting may make sense for someone who cannot afford to buy or in need of a temporary place to live, it’s not the wisest move for the long-run.

While it may be difficult to answer whether condos are cheaper than apartments, it is clear that condos are a better financial move for those seeking a long-term investment. If you are ready to take the financial plunge and find the perfect condo then contact an experienced broker today!

What is a Condo?

What is a condo? For starters, a condo is not the same thing as an apartment.

While condos and apartments share similarities, both are unique and suitable for different types of homebuyers.

Overview of Condos

The fundamental difference between condos and apartments comes down to ownership.

First, a condominium, or condo, is a collection of units that are each owned individually. This is similar to homeownership; however, the unit owners live in a shared building as opposed to on their own plot of land. Condo owners may decide to reside in their units or lease them out, making them the landlords of their property.

Condominiums are managed by homeowners associations (HOA). Each unit owner is a member of HOA and is required to pay monthly fees which enable upkeep and services provided to the community. These services may include external maintenance, garbage removal, and the upkeep of amenities, such as a pool or gym.

Homeowners Associations are also responsible for establishing the rules and regulations that residents must abide by through governing documents. These documents are formally known as the Covenants, Codes, and Restrictions (CC&Rs). Before moving forward with a purchase, it is critical that prospective buyers thoroughly examine these CC&Rs to have clear expectations of resident guidelines.

Condos vs. Apartments

While condo units are independently owned, apartment units are all owned by one person or company and located in a single building. The owner of the building often hires a property manager, who is responsible for much of the unit maintenance and management. This means that they will take care of leasing out units, purchasing large appliances, and ensuring the units are up to code.

Apartment tenants pay a monthly rent, without accumulating any equity during their residence. On the contrary, condo owners set themselves up with an investment. The monthly mortgage that they owe on the house obtains ownership over their property and the potential to sell later and profit on their unit.

Many house hunters find themselves drawn to condominiums because of the impressive amenities offered. In general, condos offer a more extensive list of amenities than apartment buildings. Many luxury condos boast valet-service, coffee shops, concierge, spas, and even more. While these services are tempting, keep in mind that they will increase the costs owners and renters end up spending.

Condo Communities

While it is possible to find a sense of community living in both apartments and condos, condo communities tend to promote greater opportunities for neighbors to get connected.

First, condo residents tend to stay put longer than those living in apartments. The lower turnover rate in condo units helps strengthen neighborhood relations.

Additionally, each condo owner’s HOA membership further promotes community. Residents have an easy opportunity to come together to get to know one another and discuss community visions, goals, and guidelines.

Now that you can answer ‘what is a condo?’, you may be better able to answer whether this is the right investment for you. If you are ready to find the perfect condominium, find an experienced broker to help with the process today.

Condo vs. Apartment: Which is Right for You?

Chicago is a Great Place to Live, Work, and Play

Buying a condo or townhome in Chicago not only gives you access to extensive professional opportunities, exciting nightlife, and a legendary food scene, but it also makes you part of a historic (and ever-growing) community.

From the bars and boutiques of Old Town to the hustle and bustle of The Loop, wherever you decide to call home in Chicago is sure to combine the best of home, office, and entertainment.

So how can you go about buying a condo in Chicago? Sure, it can be a complex process just like buying a single family home, but as with any home purchase, the result is worth it. Let’s review the steps needed to buy a condo in Chicago.

Get Pre-Approved for Financing

You might be tempted to contact an agent right away, but getting pre-approved by a lender can actually save you a lot of time and hassle upfront.

If you’ve already done some research, you might think getting pre-approved is a hassle. However, gathering information early allows your lender to determine the loan amount you qualify for. And once you’re pre-approved, you’ll have a letter that you can use in negotiation with a seller to show that you’re ready and able to purchase the condo.

Here’s a quick overview of the documents you’ll need:

  1. Photo ID and Social Security card
  2. W-2s for the past two years
  3. Tax returns for the past two years
  4. Bank/asset statements for the most recent two months
  5. Pay stubs for the past 30 days

While additional documents may be required, particularly for self-employed borrowers or if you’ve had any recent credit events, getting this information ready for your lender will save a lot of time.

Make Sure the Condo is Approved

Getting a mortgage for a condo requires that the condo be on an approved list, such as for FHA and VA loans, or for the condo to undergo a review by the lender, such as for conventional loans.

For FHA and VA loans, you can get a head start to determine whether your condo is eligible for that loan type. Search FHA approved condos here, and VA approved condos here.

Condo lists for conventional mortgages aren’t extensive, but that doesn’t mean you can’t buy a condo with a conventional mortgage. Your lender needs to conduct a limited review, which involves sending the condo association some paperwork to fill out. The lender will review it, and if everything looks good, you’ll be all set.

Proceed with Final Steps

Once you’re pre-approved and have signed a purchase contract, you’ll return it to the lender and complete the loan approval process. The lender will verify the information in your application and submit the loan to an underwriter for final review.

If the underwriter requires additional information or explanations, you’ll be informed and should do your best to address these requests (called “conditions”) as quickly as possible so that your loan can proceed. Once conditions are cleared, your loan will be approved, and you’ll have the clear to close.

An escrow account will be set up to transfer funds between you and the seller. Your lender will also set up an escrow account for the distribution of fees like taxes and insurance. Condo association dues likely won’t be paid through an escrow account.

When the time comes to close on your condo, you’ll attend a meeting along with your agent, attorney, title agent, and any seller-side representatives. Be prepared for a long meeting. If you have any questions, let your agent and attorney know. They’re there to help you.

You’ll review your final Closing Disclosure and verify that everything looks accurate. You’ll sign a lot of paperwork and pay closing costs. When the loan funds, you’ll receive your keys to your new Chicago condo.

Ready to find your dream home? Contact our preferred lender today.

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