Difference between Free holds and Condos
Most first time buyers especially the new immigrants don’t exactly know the difference between Freehold houses and Condominiums. Some of them have an impression that all high rise buildings are condos and all houses are freeholds. Some of them think that all high rise buildings as well as townhouses are condos and all semi-detached and detached houses are freehold.
But in actual practice even the semis and detached houses could be condos and even the townhouses could be freeholds and the high rise building could be apartment buildings and not Condos.
So the easy way to differentiate between condos and freehold properties are as follows:
The Condos always has a maintenance fee and the freeholds don’t have any maintenance fee.
Unlike freeholds the Condos could have some common elements like visitor’s parking, Children Park, security, gym, pool, exercise room etc which are owned collectively by all unit owners.
Advantages of Free hold properties:
There is no maintenance fee.
There is no management to control or regulate any activities like: restriction on installation of satellite dishes; restrictions on changing the color of your outside door; restrictions on installing a mailbox of your choice etc. And other than that almost no changes could be done outside the units without the permission of the management in condos as anything outside the house is usually part of the common elements.
You can have closed private fences in the freehold properties.
The free hold houses usually have wider roads and the visitors can park their cars along the roadside. Where as in condos there are assigned visitors parking and the cars cannot be parked along the roadside so especially on the weekend the visitors face lots of difficulties finding a parking.
The appreciation of freehold houses is usually much more than those of the condominiums. In condominiums the prices sometimes depreciate. As the condos starts to grow older and needs repairs/replacements in the common elements like roads, roofs, garage doors, Windows, underground parking or elevators etc, the reserve funds starts to decrease and that starts reflecting on the status certificates of the condominiums. Whenever a condo unit has to be sold, a copy of its status certificate has to be provided to the buyer at the expense of the seller. If the buyer finds out from his lawyer that the reserve funds are low then they either back out or try to negotiate the price further.
Sometimes the reserve funds go so low that a special assessment has to be levied to the unit heads by the management. That special assessment means that a fixed amount of money has to be paid by each unit head every month for a fixed period.
According to my experience that period never ends and always extended with a raised amount of money. If a condominium is going through that stage it gets very difficult to sell the units and the prices are further dropped.
Therefore in my opinion Condominiums could be a requirement but are not a very good investment. If you have already bought one try to get rid of it before it gets older and starts demanding any repairs. And if you are planning to buy one as it’s your requirement then buy a newer one and sell it before it gets to a stage where it starts demanding any repairs.
Advantages of Condos:
Security is one of the key benefit and most important element in condominiums. Lots of people buy condos for this reason.
One can easily lock his condo specially a condo apartment and travel with a piece of mind.
In most condos especially in condo apartments the utilities are included in the maintenance fee, so you don’t have to worry about the surprisingly high bills and can have a piece of mind.
The building insurance and water and waste- water bills are also included in the maintenance fee.
There are common elements to enjoy at a minimal shared cost like: Concierge service, gym, pool, sauna, library, theater, children parks etc.
You don’t have to shovel any snow or do any grass mowing.
Ideal for senior citizens who don’t really care about appreciation and want to have a hassle free luxurious life, where they can enjoy the benefits of the common elements and don’t have to do much in maintenance.
Ideal for executives working in busy downtown areas, as they can avoid lots of hassle and saves lots of time by living in a luxury condo near to their workplace
In most condo townhouses the entire exterior are covered in the maintenance fee like windows, garage door outside doors, roof and driveway etc.
About the Author:
Author of this article is, Laeeq Ahmad, a professional real estate adviser, has years of experience in real estate properties in Mississauga, helping the people to find them the dream home that fit their needs.
For more information on Free Holds and Condos in Mississauga visit: Laeeque.ca
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Laeeque Ahmad, thank you for this great article, we are family of four from Pakistan we are searching for a new home in Mississauga. I saw your website:www.laeeque.ca. I found out that you are located in Mississauga. Can you please contact me.