Plenty of homebuyer hopefuls turn to condos as a way to get into the real estate market, and for good reason. Condos are usually more affordable than single-family homes, offer plenty of amenities, and come with far less maintenance than traditional housing options.

But if you’re planning to take out an FHA loan to make a condo purchase, you’re going to have to make sure that the condo you have your eye on is FHA approved. Only condos that have FHA approval will allow purchases to be made with an FHA loan. Otherwise, conventional mortgages will be required to complete a transaction.

The question is, what exactly are the requirements needed for condos to meet in order to be FHA approved?

Minimum Units

Condo developments must have a minimum of two units to be considered for FHA approval.

Sufficient Insurance

Condos should have an insurance policy in place that covers the actual structure and all common areas of the condo. Unit owners are responsible for getting their own insurance policy that covers the inside of their unit and the contents within it.

In order for a condo to gain approval from the FHA, it must have enough insurance to cover common issues and damage to the exterior of the building. Condos are also required to have liability insurance if any accidents occur on the property and result in legal action.

The FHA will look at the condo’s insurance policies to find out what type of coverage it has and if it’s considered adequate enough for the condo to have FHA approval.

Limited Commercial Activity

FHA approval is typically only granted to condos that are predominantly residential. Many condos have retail and office space in them, usually somewhere on the first or even second levels. According to the FHA, commercial use must be capped at no more than 25% of the entire floor space of the condo

Investor Restrictions

The FHA prefers that most of the units in a condo are owned by the actual occupants. According to the FHA, at least half of the units must be owner-occupied. Further, while rentals are permitted, no more than 10% of all the units can be owned by a single investor. And for condos with ten or fewer units, no single investor is allowed to own more than one unit within the project.

Condo Project Completion

All units and common areas in the condo – with the exception of landscaping and other minor things that are unfinished – must be complete before the FHA will approve the development. That’s why condos that are still in their development phase are not approved by the FHA. Builders must wait until the development is complete before applying for FHA approval.

Bylaw and Covenant Review

Before the FHA grants any condo project approval, it will go over the development’s bylaws and covenants to make sure there is nothing in them that may be in violation of the Fair Housing Act or impede the lender’s right to force a unit owner into foreclosure for defaulting on their mortgage.

Homeowners Association (HOA) Dues in Delinquency

No more than 15% of all the units in a development can have HOA dues that are more than 30 days overdue.

Financial Stability

The reserve fund and all other financial documents will be reviewed before FHA approval is granted. The condo must be able to prove that sufficient funds are available to cover the cost of maintaining and repairing (when necessary) any part of the condo, as well as adequate funds for insurance.

The Bottom Line

There are so many details that go into the FHA approval of condos, so it’s important that you get yourself some representation to help you determine if a condo is indeed approved by the FHA if this is the type of home loan that you intend to apply for. If the condo you’re looking at is not FHA approved, you’ll either need to consider applying for a conventional mortgage or look at other condos that are approved for FHA loans.

As for sellers, it’s important to keep the status of your condo development in mind when marketing and selling your home. If your condo is not approved by the FHA, you’ll need to market your home accordingly to attract buyers who are able to secure a conventional mortgage. Again, proper representation is helpful, so be sure to arm yourself with a seasoned real estate agent who is well-versed in navigating the purchase and sale of condos and the role that FHA approval plays in these transactions.

I absolutely love Asian food. This week took me to a new spot (well, new to me!): Jin Thai. Jin Thai is located at 5458 N Broadway, in the heart of Edgewater. I loved the space immediately. The dark wood furniture, industrial light fixtures, and brightly colored cushions simultaneously feel upscale and cozy. The restaurant is small, but has large, gorgeous windows, offering most tables a view outside. One look at the menu and my mouth was already watering. I knew I had to start with an order of Crab Rangoons: fried wontons stuffed with crab, celery, and cream cheese. These were fantastic! The breading was perfect, not too thick, and the creamy filling was piping hot. I loved the sweet and sour dipping sauce that came with them too. We also ordered the Angel Wings to share. I had never heard of anything like this! The order came with two giant fried chicken wings stuffed with glass noodles, cabbage, carrots, and chicken. These were marvelous! Noodles inside chicken wings seems weird, but trust me, it’s amazing. I absolutely love curry, so I already had my entree picked out. I chose the Green Curry: green curry in coconut milk with green beans, bamboo shoots, and eggplants; served over jasmine rice. I chose beef for my protein. The curry was super flavorful and wonderfully spicy. The portion was perfect, not too big, but not too small. My friend ordered the Kao Soy: curry bahmee noodles with chicken or tofu and coconut milk. We had heard this was Jin Thai’s signature dish. It is ramen noodles in a bowl of curry topped with crunchy fried noodles and cilantro. You can order the dish as spicy as you like it; my friend chose the “medium” spice level. She ordered hers with tofu as well. The curry sauce was hearty and tasty, the tofu was firm and there was a generous amount. All of the flavors blended so nicely together! It was the perfect dish for a chilly winter day in Chicago. I can’t wait to go back and try more things!

Jin Thai is open Mondays, Wednesdays, Thursdays, and Sundays from 11 am to 9:30 pm, closed on Tuesdays, and Fridays-Saturdays from 11 am to 10 pm. They are BYOB and charge a $2 corking fee. Reservations are accepted for 6 people or more. Find more information on their website.

RACHEL HOOVLER & DEAN’S TEAM CHICAGO

If moving is on the horizon for you sometime soon, then you’ve got plenty of decisions to make. And one of these important decisions is whether to sell or buy first.

Should you list your home first and look for a willing buyer before committing to another home? Or should you find something first to make sure you’ve got a place to go if you happen to sell faster than you initially thought?

Many homeowners are usually torn when it comes to making this decision, so the typical solution is to simply buy and list at the same time. The thing is, coordinating closing dates on both the sale of your current property and the move-in date of your new home can be a real challenge.

So, how can you make sure that buying and selling at the same time works out for the best? Consider following these tips.

Determine the Market You’re in

The temperature of the housing market in your area will determine how to proceed with your move. In fact, this is perhaps the most important factor to consider when timing your purchase and sale perfectly. The amount of time it takes to sell versus how much time it will take you to find the right home to buy will need to be considered when timing it correctly.

Is it a buyer’s market? If so, that means there are plenty of sellers out there and lots of inventory for buyers to choose from with fewer buyers to compete with. In this market, finding a home at a good price shouldn’t take long at all, though selling might take a little longer.

Is it a seller’s market? Then that means there are tons of buyers to compete with and not much inventory, which could take you longer to find the right property. But as a seller, you have a better chance of finding a buyer quickly and sealing a deal on your current home in a short time frame.

If you decide to list your current home and look for a new property at the same time, make sure you take the current market into consideration. Your listing strategy and house-hunting tactics should be tweaked accordingly to try and get the timing right.

Get Pre-Approved For a Mortgage

It’s always a good idea for buyers to get pre-approved for a home loan before they start house hunting. This will help them get an idea of how much they can afford in a home purchase. A pre-approval letter will also help get the ball rolling with mortgage approval so the mortgage can close faster after a deal is reached. This is important if you’ve sealed a deal on your current home and need to close faster.

A pre-approval is particularly important if you’re a buyer in a seller’s market, as you’ll be competing with many other buyers for fewer homes. In this case, you’ll want to do whatever you can to bring a purchase deal into fruition without any hiccups, and being pre-approved for a mortgage can help.

Have an Appraisal and Inspection Done on Your Current Home

Getting your home appraised before you list will help you determine the best listing price for your home. Inflated listing prices can end up causing listings to linger on the market for longer than necessary, causing them to go stale. An appraisal will provide you with some great insight into what your home is actually worth according to market conditions and will help you price accordingly.

Having your own home inspection done before buyers first make their way into your home to scope it out will help you identify any issues that may need some attention. Knowing about any potential defects with your home will give you the opportunity to fix them before your property is listed. You can be sure that such defects will be identified in a buyer’s home inspection, so uncovering them before an offer is agreed on can make the sale go much smoother.

Both an appraisal and a pre-listing home inspection can help you get your home ready for the market and price it accordingly, which can both prove to be extremely helpful in ensuring a seamless transaction.

Consider Including a Contingency to Sell Your Home First

If you find yourself in a buyer’s market, buying a new house shouldn’t be an issue. But selling might take a bit longer. In this case, you could find yourself with two mortgages to pay if you can’t sell your home after committing to buying a new one. In this case, you may want to consider including a contingency in your offer on a new home that states that you’ll only buy the home if you’re able to sell your existing property.

Just keep in mind that many sellers might not be too keen on such a contingency and may reject it.

Hire an Experienced Real Estate Agent

Your best bet when trying to time the purchase of a new home and the sale of your current property correctly is to hire a seasoned real estate agent who’s experienced with these situations. Trying to time these two transactions can be a complicated endeavor, so working with an experienced agent can prove to be extremely helpful.

An agent who is well-versed in these situations can help you come up with a sound strategy, negotiate appropriately, and price right to ensure that the timing of both transactions is as seamless as possible.

The Bottom Line

Lining up the closing dates on the sale of your current home and the purchase of a new one can be a real challenge. When you’re ready to make a move, make sure you go into this situation with a sound plan of action and a seasoned real estate agent in your corner.

Condo living is pretty popular among buyers who are looking for something more affordable than traditional freehold homes. Plus, there are a bunch of other perks to living in a condo beside their more affordable purchase prices, including their amenities, low maintenance, and 24-hour security.

But your mortgage isn’t the only monthly payment you’ll have to make when you own a condo. Unlike a traditional freehold house, condos also come with monthly condo fees that every owner in a complex must pay.

The amount that each owner is responsible for paying is based on a specific rate multiplied by the square footage of their respective unit. You could pay as little as $200 to as much as $1,000+ in condo fees every month, depending on where your condo is located, the type of building it is (ie. luxury condos usually charge higher fees), and the type and number of amenities offered.

The question is, what exactly do monthly condo fees cover?

Security

Most condo buildings staff a 24-hour concierge who will serve as security, as well as a point of contact for things like visitors, mail, minor issues, and so forth. The concierge or security guard’s paycheck is typically covered by funds collected from monthly condo fees.

Maintenance of Common Areas

Every owner is responsible for maintaining their own individual units. But the maintenance, cleanliness, and repair of all other common areas of the building are paid for via condo fees. This includes the maintenance of things such as:

• Landscaping
• Parking garage and lot
• Elevators
• Hallways
• Fences
• Walls
• Gates
• Windows
• Rain gutters
• Heating and cooling systems
• Gas pipes
• Electrical systems

Maintenance of Amenities

In addition to the common areas and systems just mentioned, condo fees also cover the maintenance of the building’ amenities, which differ from one condo complex to another. That said, common amenities in condominiums may include:

• Game rooms
• Fitness rooms
• Saunas
• Swimming pools
• Party rooms
• Rooftop gardens
• Guest suites

Insurance

Not every condo complex includes insurance as part of what their condo fees cover but must do. The insurance policies that condos take out cover building exteriors and shared common areas. Sometimes they might extend to cover things like damage done by floods, fires, and earthquakes. Given this, unit owners are only responsible for taking out an insurance policy to cover the interior of their own units and their personal belongings.

Reserve Fund

A reserve fund is an emergency fund, so to speak, that is saved up to cover the cost of occasional and unexpected repairs. For instance, a new roof or a newly paved parking lot are not things that must be done every year. Instead, they occur on occasion, and the money in a reserve fund can then be applied to cover these costs.

Ideally, there will be enough money in the reserve fund to adequately cover these costs. If not, each unit owner will be forced to fork over a lot of money in order to make up the difference between what’s in the reserve fund and how much needs to be spent.

A condo board that is well-run will charge each owner a small amount every month to be put towards keeping the reserve fund well-padded. That way, when the money is needed, there will be no need for owners to have to pay much more than they’re already responsible for paying every month.

Utilities

The majority of condo fees cover the cost of certain utilities of the building, including (cold) water, garbage collection, and sewers. Some may go so far as to cover heat, electricity, and hot water, and some may cover everything. Every building is different, so you’d need to check with your specific condo to find out exactly what your fees cover.

The Bottom Line

There are plenty of things that you have at your disposal when you live in a condo. But such things aren’t free; instead, you’re paying for them through monthly condo fees. If you’re in the market to buy a condo, make sure to find out exactly how much the condo fees are and what they cover before you sign on the dotted line.

This week took me to a Chicago staple: Fahlstrom’s Fresh Fish Market. Fahlstrom’s is a unique experience from start to finish. On the right hand side of the restaurant is a fresh fish market, offering 16-18 varieties of fresh fish each day. Here you can also order party trays of smoked lox, sturgeon, rainbow trout, whitefish, and tiger shrimp. Fahlstrom’s “World’s Best Tuna Salad” and Smoked Trout Dip are also available for retail purchase here. You’ll also find Alaskan King Crab Legs, mussels, Delaware oysters, scallops, and lump crab meat for sale. Love crab cakes?? You can buy those individually as well! The retail section is well stocked with oils, sauces, and spices for cooking your newly purchased fresh seafood at home. As you look towards the back wall, you can’t help but notice rows and rows of brightly colored cereal boxes! This is The Cereal Wall; a section dedicated to childhood favorites that can be ordered straight from box to bowl. Your cereal is served in a chilled bowl with your favorite cereal (you can even mix and match!), cold milk, and fresh fruit. Fahlstrom’s menu is large and diverse, ranging from breakfast all day to traditional seafood entrees to po’ boys and much more. It made it so difficult to decide! We finally settled on a few entrees to share. I love crab cakes, so I knew we had to try the Mirabelle Crab Cake Sandwich: lumps of blue crab with a roasted red pepper sauce and lettuce on a toasted butter bun. This was delicious! The crab cake had a great crust, but the breading wasn’t too thick. I loved the red pepper sauce, it added depth to the simple sandwich. We also ordered the Pan Fried Shrimp Tacos: corn tortillas, cabbage, chopped radish and pineapple, goat cheese, cilantro, chipotle mayo, and avocado cream. These were very tasty! My main complaint is that they weren’t hot enough coming out of the kitchen. Fried shrimp just aren’t as good if they’re not piping hot! Finally, we tried the Pan-Fried Drake’s Shrimp Po’ Boy: Drake’s seasoned, pan-fried shrimp, lettuce, red onion, and tartar sauce, all on a toasted French loaf. The flavors of this were great, but again, it just wasn’t hot enough. It was a little disappointing to have our entrees be tasty, but know they had probably been sitting in the back before they came out. I will give Fahlstrom’s another chance though!

Fahlstrom’s is located at 1258 W Belmont Avenue. Hours are Mondays from 11 am to 9 pm, Tuesdays through Fridays from 11 am to 10 pm, Saturdays from 9 am to 10 pm, and Sundays from 9 am to 9 pm. For more information, check out their website.

RACHEL HOOVLER & DEAN’S TEAM CHICAGO