Purchasing a condo means buying two things simultaneously: your individual unit and a fractional share of the common areas, amenities, and building systems. Monthly HOA fees in US condo buildings typically range from $200 to $600 for mid-market properties, but luxury high-rises in cities like Miami, Chicago, and New York City regularly charge $1,500 to $3,000 per month when the building includes doormen, pools, fitness centers, and concierge services. These fees directly affect your affordability calculation and must be included in the debt-to-income ratio your lender uses to qualify you.
How to evaluate HOA financial health
Request the last two years of HOA meeting minutes, the current operating budget, and the reserve fund study before making an offer. A reserve fund that is less than 70% funded is a warning sign that the association may levy a spécial assessment for major repairs such as roof replacement, elevator modernization, or parking structure work. Spécial assessments have reached six figures per unit in some aging urban buildings, so this due diligence is worth the effort.
FHA approval and financing considerations
Not all condo buildings are approved for FHA or VA financing. If the building has more than 50% investor-owned units, is involved in active litigation, or lacks adequate insurance coverage, it may fall outside FHA guidelines, limiting your buyer pool significantly when you eventually sell. Ask the listing agent for the building's FHA approval status before falling in love with a unit. Conventional financing through Fannie Mae has its own condo project approval requirements, including limits on how many units one entity can own, which affects investment-heavy buildings popular in resort markets.
