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The housing market is volatile, to say the least. Since the COVID-19 pandemic, demand and supply have shifted greatly, causing housing prices to shift unpredictably.

Inflation has also raised the average home prices. In November 2022, house prices were 8.6% higher than they had been the previous November.

Additionally, rising mortgage rates have hindered consumers' abilities to purchase real estate; in January 2023, the average APR for a 30-year fixed mortgage was 6.36%, nearly double the average a year prior (3.22%).

With all of these factors in mind, many consumers have wondered whether they will ever be able to afford a house. An alternative many have opted for is condo buying.

While condos aren't always cheaper than single-family houses — and homeowners' association (HOA) fees can increase monthly costs — they present a unique consideration for those wanting to buy real estate in an ever-changing, costly housing market. Condos are often smaller than single-family homes and come with slightly less privacy, but they offer many community and lifestyle benefits.

With any major purchase, insurance is an important protection to think about. Owning a condo leaves you responsible for interior repairs. Storms, theft, fires, and injuries in your condo can leave you with extensive costs that you may not be able to afford out of pocket.

Insurdinary strives to help condo owners find comprehensive, affordable insurance policies that protect their investments and provide peace of mind.

Condo insurance (also known as HO6 insurance) operates similarly to homeowners insurance. The insurer will reimburse you for the costs to repair damage that is outside your control, such as due to a natural disaster or another person's wrongdoing.

When you buy a condo, it will likely be under the authority of a homeowners association. In most cases, the HOA has a master insurance policy that covers the physical buildings in a condo community. This means that your HOA will likely be responsible for the exterior of your unit, including the roof, siding, driveway, and sidewalk.

If your condo community has common areas, the HOA will also be responsible for these. You will likely only be responsible for the interior of your unit — the HVAC system, plumbing, walls, flooring, fixtures, etc. (While this is the general structure of most condo sales, you'll want to check with your HOA to determine your exact liability).

While some HOAs require condo insurance and your mortgage lender may also require it, there’s a chance condo insurance won’t be mandatory for you. Still, purchasing condo insurance is an excellent idea, as it can protect you from major, unexpected repair costs.

Condo insurance plans come in many variations. Thankfully, this allows you to pick and choose the coverages you need and avoid paying for the ones you don’t.

When you build a condo insurance plan, you can opt for many different types of coverage. The more coverage you have, the better protected you are against potential damages. However, more coverage also tends to translate to higher premiums, which are the costs you pay each month to keep your insurance active.

While every insurance policy is slightly different, standard condo insurance provides coverage for damage from the following:

• Fire
• Smoke
• Wind
• Hail
• Explosions
• Lightning
• Burst pipes
• Theft
• Vandalism

Condo insurance usually doesn’t cover the following:

• Wear and tear
• Floods (you can purchase separate flood insurance if you live in a flood-prone area)
• Intentional damage
• Damage from animals
• Earthquakes