Four Must-Know Facts Before Buying a Denver Area Townhome or Condo

January 23, 2025

Thinking about buying a Denver area townhome or condo? Before you do, take a few moments and make sure you read this great real estate blog. Denver’s townhome/condo market is in a unique phase right now, and it’s important as a townhome/condo buyer that you understand exactly what is going on with the Denver townhome/condo market.

Below you’ll find four must-know facts about buying a Denver townhome/condo in today’s current market conditions. Know someone thinking about buying a townhome or condo? Don’t forget to be a great friend and share this article with them too!

1. Special Assessments Are Real & Common

Anytime a TK Homes agent works with a buyer looking to purchase a townhome or condo, we always make sure they understand that a special assessment is a possibility with an attached style home. However, in today’s high inflation market conditions, assessments are becoming far more common than previous years. In fact, I would go as far as saying it’s not a matter of if you’re going to have a special assessment, but a matter of when.
 

The other big thing to think about with special assessments in today’s market is the amount of the assessment. Historically we would see special assessments in the range of a few thousand dollars per unit. Today, it’s not uncommon to see special assessments in the amount of several thousand dollars, with assessments ranging from $20,000 to $25,000 being fairly common. In fact, just last year TK Homes sold a unit in the Arvada area that had a special assessment right around $42,000 per unit.

The good news is there are ways as a unit owner you can help protect yourself from these special assessments. There are riders and insurance add-ons you can add to your hazard insurance premiums that would cover such a special assessment if it were to come up.  So, make sure you talk to your insurance agent today and get coverage in place to help with any possible special assessment that might come up.


2. Not All Communities Are Equal

This fact is more of a general reminder that it’s important to research each community before deciding to buy into it. There are the things that most buyers always research, like if the community offers a pool, clubhouse, includes paid utilities like trash, recycling and water, and what the parking situation is for owners and guests. However, this research really needs to go much deeper than included amenities.

At TK Homes, we always encourage our buyers to contact the HOA before deciding to make an offer. They should be asking some pretty straight forward and generic questions, such as if there are any upcoming special assessments, any talk of increasing HOA dues, clarifying exactly what the HOA maintains, and what is the owner’s responsibility (example, exterior back decks/patios). To be honest, the questions you ask are not as important as how long the HOA takes to respond. How they respond to a potential owner is a good indication how you can expect to be treated once you’re an owner. If the complex never returns your call or email, then you know that this is a community where you might have to babysit the HOA a little more to get any issues that might arise addressed. Of course, the answers to these questions will also help when deciding if you want to buy a unit in the community.

When you’re talking to the HOA, treat it like an interview. Is this complex responding in a way that makes you want to be a part of the community? Do you get the sense that the HOA is taking care of the community and cares about it like you would as an owner? Before you buy, you have a choice of the community you live in, but once you own, the only way out is to sell and move out.

3. Appreciation Is Not Guaranteed
 

Denver’s real estate market has been softer for a few years now, really since mid 2022 when interest rates went up and remained high. Many detached single-family homes across Denver are nearing values close to Denver’s peak values in 2022. However, this cannot be said for townhomes or condos. With the rising HOA dues, the special assessments mentioned above, and slightly higher interest rates for these purchases, the townhome/condo market have been much slower to recover across Denver. In fact, when recently showing several townhomes/condos, I saw current list prices below the price home sellers purchased the property for several years back, including homes that sold before the peak values in 2022.

Knowing that the townhome/condo market is recovering at a slower rate than the detached home market in Denver means that, if you’re buying a townhome/condo today, you need to ensure you’re buying with the intention of keeping it for several years. The minimum amount of time I would encourage you to plan on keeping a townhome or condo you’re purchasing in 2025 is five years, but longer than that is even better. This time frame will hopefully allow for the townhome/condo market to correct and have enough positive appreciation to ensure you’re able to sell for a profit, versus selling at a loss.

4. You Have Options, Take Your Time

I know you may be thinking at this point, maybe buying a townhome or condo isn’t a good option right now. The truth is as long as you’re being smart about your purchase, doing your homework, and buying into a community you love, a townhome or condo can be a great option for you right now! A big reason this can be a good decision is the fact that you have time and options available to you that many buyers haven’t seen in the Denver area for several years. In fact, a recent stat shows that there are double the number of townhomes/condos for sale today as there were at this same time last year.

So, when you’re shopping, take the extra time, see the options available, ensure you’re buying into a great community, and the perfect floor plan for you. This process may involve viewing more homes than a typical buying journey. Also, it might take a few more days after you locate a unit you love to research and talk to the HOA before submitting an offer. If you take advantage of the extra time and options available to you, you can ensure you’ll purchase a great townhome/condo that you will love for years to come!
 

Townhomes and condos have always been a great option for many homebuyers in the Denver area, and that’s still true today. However, if you rush into a buying decision, with today’s rising cost of maintenance, insurance, and living, buying the wrong unit could turn out to be a nightmare versus a blessing. With these four must-know facts about Denver’s current townhome and condo market conditions, you’ll be sure to enjoy your townhome for years to come, and when it’s time to sell, you’ll see a positive return on your investment.

If you are thinking about buying a townhome or condo in 2025, contact a TK Homes agent today and let’s chat about your goals regarding your purchase. We are excited to help you navigate the complex decisions to ensure you’re buying into the right community and at the right price for long-term enjoyment and success!

~ Written by CEO/REALTOR® Trevor Kohlhepp