What you know (or don't know) when it comes to purchasing a condominium in Emerald Isle, NC can make your buying experience a dream or a nightmare. Most buyers know where they want to be (location), how many bedrooms/ baths, and how much they are willing to spend. Often overlooked are the small fees that when added up could be a deal breaker or at a minimum an eye opener. Being prepared (finances in order), ready (know your numbers), and confident (waiting for the right property) can make the difference in getting a signed deal or being a day late. Besides mortgage and taxes what other costs are associated with owning a condominium in Emerald Isle, NC? Here’s the Big 3 for Emerald Isle, NC.
1) HO-6 insurance Policy The correct name for and HO-6 policy is "Betterments and Improvements." This policy covers your personal items and any improvements that have been made since the original build out. If you'll be financing a purchase, the lender will want proof of insurance prior to loan approval. In addition to covering the items above, you can purchase riders (additional items covered). I highly recommend discussing this with a LOCAL insurance agent for the full range of products. For planning purposes, I have seen most policies fall between $400.00-$750.00 per year.
Side note… master insurance policy & flood insurance are almost always part of the condo fee. No need to budget.
2) Utilities (electric/ gas/ cable) Several factors come into play when trying to get a baseline of cost for utilities. The following numbers are based on a 2-bedroom condo that has a central hvac system and purchases an average cable / Wi-Fi package. For budgeting purposes, you can expect the: electric will run $235.00 monthly on average and cable package will run $125.00 monthly on average. Again, there can be major fluctuations depending on packages and temperature comfort levels.
Side note… some buildings include cable and Wi-Fi in the condo fee. Confirm with Agent
3) Condo Fees One of the major expenses associated with owning a condominium in Emerald Isle, NC or in other towns on Bogue Banks is the condo or HOA fees. Condo fees vary from building to building and even within the same building. HOAs collect monthly fees to underwrite a variety of costs, including insurance, maintenance, repairs, operating common areas, waste pick-up, snow removal, and reserves.
The last item is especially important, because major components can wear out over time or be damaged, say by hurricanes. The HOA naturally wants funds on hand to make repairs as needed. Unfortunately, if condominium reserve funds are insufficient (due to poor management or just bad luck), an HOA can extract a “special assessment” from you. That’s a cute term meaning you are about to get a very big bill. How big? There’s no world record holder, but special assessments of more than $100,000 have been reported for condo owners of the Grand Villas in Indian Beach, NC.
What happens if you don’t pay or can’t pay? The debt becomes a lien on the property, and potentially the HOA can force you into foreclosure. To make matters more interesting, monthly HOA fees are not set in stone. They can go up – and in some cases they can go up a lot. Because costs are constantly on the rise due to inflation, most HOA’s annual budgets require annual increases.
Side note… your agent will be able to provide you with of list of items included in the HOA fee.
When you are ready to buy a condominium for retirement or a second home, please call or text me at 919-308-2292 or send me an email to: DRaczkowski@fathomrealty.com. I look forward to answering all of your questions.
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