AS HOMEBUYERS’ NEEDS CHANGE, LOFTS
HAVE BEGUN TO ACQUIRE MORE CONDOMINIUM-LIKE CHARACTERISTICS – LIKE
ENCLOSED BEDROOMS AND MORE BATHROOMS – WHILE WITH THEIR
SLEEK MODERN FINISHES, THE NEWER CONDOMINIUMS ARE LOOKING MORE
LIKE LOFTS.
There is now so much crossover between the two categories
that it’s often hard to distinguish one from the other.
But distinctions do remain between these so-called “soft
lofts” and condos, and it is helpful for the homebuyer
to understand these differences when embarking on a search.
First, let’s look at what the two types have in common.
Legally, most lofts are, in fact, condominiums. In both, an
owner holds title to their own living space, and is co-owner
with the rest of the homeowners of all common areas (lobby,
garage, secure entry system, pool, exterior landscaping, etc.).
All condo and loft owners must abide by a set of rules and
regulations or CC&Rs (covenants, conditions and restrictions)
governing land use, and all developments have a Homeowners’ Association
(HOA) with an elected president and board.
The big differences between condos and traditional lofts are
questions of style and use. Lofts, with their soaring ceilings,
wide open spaces and modern finishes such as concrete, granite,
hardwood and stainless steel, offer a sense of authenticity
and originality to many buyers. The prototypical loft was a
conversion of a formerly industrial or historical building
in an urban/transitional area, and offered native architectural
elements such as massive structural concrete columns – though
nowadays many lofts are built from the ground up. Condos and
townhomes, on the other hand, are usually built new, and while
they may incorporate design elements of lofts, are closer in
spirit to single family homes: room divisions, at least 1 and
a half baths, often with wall-to-wall carpet and more traditionally
designed kitchens. Some condominiums have more amenities than
lofts – gyms, pools, more extensive landscaping, concierge
service in the higher end properties – and thus higher
HOA fees.
The most important distinction between lofts and condos is
that some lofts are zoned as “live/work” while
condos are strictly residential. Although what is permitted
varies from city to city, a live/work designation typically
allows the owner to run a business out of their home, have
paid employees, stock inventory and have “walk-in trade” or
customers. Owners of residential units may work out of their
homes, but are not allowed to have paid employees or the other
items mentioned above. The type of zoning affects your loan;
many funders in the secondary mortgage market will not fund
loans for live/work units, so it is important to work with
a mortgage broker or bank that knows this market and handles
these types of loans.
What is true about both condos and lofts is that, as a National
Association of Realtors study showed earlier this year, they
have been appreciating in value at twice the rate of single
family detached homes nationwide. So, loft or condo, it comes
down to what features are most important to you. Either way,
you’ll be making a sound real estate investment.
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Spring 2004 Table of Contents 
