Both, an Apartment and a Condominium or Condo are Housing options that are available to an individual or a family. One chooses between the two basis the affordability and requirement of the individual.
An apartment building is typically a single containing multiple dwelling units. Such buildings are completely owned by a sole owner or more commonly a corporation. The individual units within such a building called apartments are leased to different individual occupants. Basis the size and layout of the individual houses within the apartment there are various classes and definitions of an apartment building. An apartment could be a Classic Six/Seven/Eight apartment, depending upon the number of rooms, bathrooms contained within the apartment. Typically a Classic 6 Apartment would contain a living room, a separate dining area, two bedrooms, two bathrooms, and a smaller â€œmaid’s roomâ€ located off the kitchen. Other popular types of apartments are the Convertible apartment, Corporate Apartment, Duplex Apartment, Garden Apartment, Penthouse Apartment, Railroad Apartment, Triplex(similar to duplex, containing three floors).
On the other hand, a Condo is a housing unit that is owned by an individual and the common areas in the building are owned in undivided fractional interest, equally among all owners of units within the building. Such units are run and maintained by an association comprising of the owners of the Condos. There are two major types of Condos: Leasehold and Freehold. A leasehold is one where the land bank is owned by a trust or some institution which is unable to sell off the land, hence giving it out on lease ensures some income to the owners. In these cases the owner typically leases out the property to the declarant for a period which is usually quiet long and spans over a couple of decades. The declarant does not have the right to sell off the piece of the property, but can transfer the lease to another potential declarant. The purchasers of individual units actually only hold lease to the units owned by them. Freehold Condos on the other hand mean that the owner or developer owns the land on which the individual units are built. Since the declarant is the actual owner of the land, the ownership can be transferred to the purchasers of the condominium. Freehold condominiums can further be subdivided into further four categories: Standard condominium, Phased Condominium, Common elements Condominium and Vacant Land Condominiums.
A condo could come in multiple styles including a duplex (two entrance doors and two stories), Garden type, High rise, Low rise etc.
On comparing the two, a Condo and an Apartment, one finds that the major differences lie in the following factors:
- Affordability & Ownership: While both could be rented, a condo is normally owned but an apartment is commonly rented. Usually the payments around a condo involve mortgage payments on the loan taken for purchasing the property by an individual, the payout around an apartment is in the form of monthly rents paid to the landlord. Thus an apartment is much more affordable as compared to a Condo. However, on the flip side, the mortgages do not increase over time, while the rent can increase with the passage of time.
- Maintenance: The maintenance of an apartment is completely taken care of by the owner. The Condo owners have to take care of some part of the maintenance by themselves, such as fixing leaky roofs, faulty plumbing etc. However, the tenants in an apartment cannot make any changes to the structure or the look of the apartment without the prior permission of the landlord while a condo owner can.
Thus we can see that while in the short term an apartment is easy to rent and live, as the years pass by, investing in a condo seems more sensible and profitable granting the owner much more authority over his own home.