When you first think of purchasing a condo the word brings up visions of high-rise buildings in New York, San Francisco or Chicago. Nationwide, however, the idea couldn’t be more wrong. There are all types of condos, ranging from townhouses to small mid-rise buildings to converted old tenement building in up-and-coming urban areas. All these different types of condos offer a wide array of amenities that all add to the price of your dream condo. But how much do they add? How do you price out your must-haves from the dreams? A recent Wall Street Journal article described a study that looked at the number of special features, such as wood-burning fireplace or granite counters, listed in a home sale ad and the ultimate selling price. They discovered that each additional characteristic mentioned in an ad increased the sales price by just under 1%, but also made the property sell faster. Obviously, there are amenities that will increase the price significantly more, for example, having a balcony, or high floor with a view, but use that number as one reference point for the little add-on perks.
Now I’m going to try to tackle the question about value-added amenities by pricing out some condos in Georgia where I will be hunting for my dream condo. The choices are endless. You can go upscale and modern with all the amenities your heart desires, you can go basic with a few nice perks, you can purchase a detached condo with a full yard, and you can even land a historic condo with a lot of charm. Living in the South, my personal dream is the historic condo, but when I really sit down and imagine the condo that would fulfill all my fantasies, it also boasts of a full fitness center, hardwood floors, private parking, and at least a 1,000 square feet in a prime location that’s far enough away from Atlanta to avoid rush hour traffic, but close enough to the city to make sure great entertainment isn’t a hours-long trek.
A girl can dream, but unfortunately each and every item on this list comes at a price. Let’s look at how much more I might have to pay for my dream condo amenities:
Fitness Center — These days, fitness centers are considered a pretty basic amenity when it comes to purchasing a condo rather than a luxury addition to your new home. And, according to this article from The Real Deal, they don’t really add much value to the condo itself, so you’re looking at about a 5% price raise. Therefore, if you are purchasing a $100,000, you can expect to pay about $5,000 for that full-service fitness center before your association dues (for gym upkeep and staff) are factored in. In Georgia, gym memberships will usually cost you around $55 dollars per month for full access. Based on that rate, you would pay approximately $660 per year to use your local fitness center, which mean that for $5,000 you could buy a gym membership for almost 7.5 years. Depending on the quality of the gym in your condo, it could be cheaper to just hit up the local gym. However, it could be significantly more cost-friendly – and more convenient – to purchase a condo with a gym, if it adds much less to your monthly association dues than an outside gym fee. My advice is to compare the quality of the condo’s gym and the gym up the street that you might ultimately use and look at what you get. If you aren’t the type to use the gym actively, it might be your best bet to skip the condo with a fitness center since it doesn’t add very much to the resale value, and put your money into other amenities.
Hardwood Floors — Installing hardwood in your new condo post-purchase is an expensive and time consuming and messy project, even if you choose to DIY. When it comes to the cost, expect to pay anywhere from $2 – $14 a square foot for the materials and anywhere from $3 – $10 per square foot for installation. That said, hardwood floors usually raise the value of an average unit by 15%. (In a high-priced luxury condo hardwood floors are expected as a standard feature.) Here, it’s important to do a side-by-side comparison of a unit without hardwood + the cost of adding new flooring versus a condo with the hardwood included. Also compare the estimated 15% value increase to the cost of adding floor to a similarly sized condo. These two cost comparisons should really help you narrow down which is a more budget-friendly option for you. (Note: Make sure to review your condo association rules, new flooring might be a no-go.)
1,000 sq. ft. & Prime Location — Here, pricing gets tricky. The cost of this size might be a lot pricier if you want a luxury condo or want to live right in the heart of Atlanta. In the state’s capital, there is a good mix between updated factory-style lofts and modern construction when it comes to owning a condo. The problem with Atlanta, as with all major metro areas, is that you sacrifice space and a good price for the perks of living in the city. There is always something to do and the nightlife is perfect for city lovers. However, depending on what is important to you, you could end up getting less bang for your buck. Usually, you’ll pay about $100,000 – $300,000 for 1,000 square foot condo in Atlanta, but that all depends on what location and amenities you choose. Outside the perimeter, it’s a whole different deal. Here, you’ll find suburban type communities of subdivisions. You can find plenty of condos as well, but they have less of a city feel and more of a family, 2 kids and a big yard look. The suburbs outside the city are popular places to live, but the prices vary tremendously depending on the neighborhood. Unless you scout out condos in one of the most sought-after areas, you should expect to pay about $100,000 or less for a 1,000 square foot space. That said, that prime Atlanta location could cost you almost triple the price!
The takeaway here to keep your amenities dreams in perspective when you are on the hunt for your dream condo — each little extra might seem like a great value, but combined they could really hike up the overall price of your new place without adding much to your condo’s market value!