NEW YORK (CNN/Money) -
Okay, real estate mavens, which property typically has a higher value: the old-fashioned single family home or a condo? The answer may surprise you.
In the fourth quarter, the median existing condominium price was $174,000, 14.9 percent higher than a year ago. By comparison, the typical single-family home cost $171,600 in the fourth quarter. This is the first time the typical condo cost more than a detached house, according to the National Association of Realtors.
What's more, prices are climbing faster for condos than for homes. What's going on?
One possible reason is that more luxurious units are being included in the mix that are on par with single-family homes. And the momentum doesn't appear to be slowing.
Are you in the market for a condo? Here are today's five tips...
1. Understand what you're buying.
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 CNNfn's Gerri Willis shares five tips on what you need to know when buying a condominium.
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If you're buying a house, it's pretty clear that you are getting title -- free and clear -- to the home and its yard, right? Well, with a condo things are a little more complicated. A condo buyer's property line is the interior walls of their unit -- that is everything inside your apartment.
But that's not all. You also own -- in conjunction with all the other condo residents -- the land your building sits on and the building itself. So that means that when the roof on your building gives out, you, along with your neighbors, will have to share the cost of repairs.
2. Scrutinize the building's budget.
Naturally, when considering a condo to buy you'll want to do the same due diligence that you'd do buying a house -- you'll hire an inspector and rigorously check both the unit and the building itself.
Just as important, though, will be a thorough examination of the condo's current operating budget. Make sure that it adequately covers basic costs like building maintenance, staff salaries, utilities, garbage collection and the like. There should also be an adequate reserve fund to cover predictable expenditures like painting.
According to "Home Buying for Dummies," an adequate reserve fund would be in the neighborhood of 3 to 5 percent of the condo's gross operating budget. (This can vary by where you live. Expensive real estate markets may face higher costs).
3. Know thy neighbor.
People usually buy condos because they are so much easier to take care of than detached homes, and the typical condo dweller falls into one of two camps -- either they are first time homebuyers or empty nesters looking to simplify their lifestyle.
You'll want to buy into a building where the owners have a similar situation as your own for two reasons. 1.) You'll have less privacy than in a home. 2.) You'll likely have some sort of involvement with the condo's homeowner's association which essentially governs the building.
Ask what percentage of joint ownership you'll have -- it'll determine how much you'll pay on special assessments for unexpected repairs and how many votes you'll have when big decisions are made. Look for red flags. Ask whether homeowners association dues have gone up frequently. Are new special assessments coming? Why weren't the projects anticipated?
4. Yes, you'll still need insurance.
Many condo owners think insurance is not necessary. But when purchasing a condo you'll actually have two policies.
The first is a form of insurance which falls between a traditional homeowners policy and renters policy and provides coverage for your personal possessions such as jewelry, furs or a home computer. It also covers any structural improvements made to your apartment as well as liability protection. According to the National Association of Insurance Commissioners, in 2000 (the last year numbers are available for) the average condo/co-op personal insurance policy was $230/year.
The condo board will also have a policy on the entire building which you'll help pay through monthly dues. The Insurance Information Institute says to adequately insure your apartment, it is important to know which structural parts of your home are covered by the condo association and which are not. Make sure to read the board's bylaws and/or talk to the condo association, insurance agency or an attorney. You may also want to consider insuring your unit with the same company that provides the building's insurance.
5. Don't forget the details.
Before you buy, you'll want to read all the condo documents -- including the master deed and the declaration of covenants, conditions and restrictions carefully. This is called a CC&R.
It's not likely you'll be able to change any of the rules they have in place, whether it's restrictions against having pets or a requirement that your window shades be a certain color. And, for goodness' sake, make sure you understand the situation with parking. Our "Home Buying for Dummies" expert, Ray Brown explains why.
"If you are told you have a parking space, don't just take the developer's word for it or the real estate agent's word for it. Go down and look at parking spaces because the way the parking spaces are dealt out may vary wildly."
He says he has seen a lot of developments that induce people to buy a condo by making parking first come, first serve. As a result you'll see some of the least expensive units with wonderful parking spaces and you'll see some very expensive units that were the last to sell in the project with really awful spots.
Gerri Willis is the personal finance editor for CNN Business News. Willis also is co-host of CNNfn's The FlipSide, weekdays from 11 a.m. to 12:30 p.m. (ET). E-mail comments to 5tips@cnnfn.com.
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