BUYING A CONDOMINIUM?
In the past 30 years, buying a condominium has become more
popular.
They make great affordable homes if downsizing. Before purchasing, there’s information a
homebuyer should know to ensure good homeowner experience.
How the Condo Association is Organized and Conducts its
Business
Owners have a share or interest and are obligated to pay
monthly dues. ‘Condominiums are governed
by the condo declaration, rules referred to as Covenants, Conditions and
Restrictions (CC&R’s) which the owner of the Condo must follow. Examples of the rules ma be restrictions on
pet ownership, remodeling projects or leasing of the Condo.
Before the sale of the Condo, the CC&R’s must be
disclosed. Associations will vary. Check the association records, budgets and
financial statements. Reviewing the
latest financial statements will determine the financial stability of the
association.
Find out the building is in good repair. Who handles repairs or maintenance before
they become a bigger problem? It’s a
good idea to have an inspection on the unit before purchasing.
Get a copy of the certificate of insurance (summary of
association’s policy). Buyers should
understand what the policy covers and what they are responsible for.
Who manages the association?
Some hire a management company. If the condo is professionally managed,
buyers can also check out the management company.
Assessments/Monthly Fees
Knowing the monthly assessment amount is an important part
of the condo purchase. The amount for
assessments is usually considered by the lender in the mortgage application
process.
Check the history of the assessments to see how many increases have been made in the past 10 years and how large they have been.
What is a Condo?
Condominiums are buildings in which individuals separately
own the air space and structures inside their unit as well as the surfaces of
floors, walls, and ceilings, but they joint own an interest in the common
areas that they share such as the elevators, hallways, dividing and outer
walls, swimming pool and parking lot.
Management Issues Worth Checking Into
Determine if the development has any pending legal actions.
Are there any disputes between owners, with developers or with the association? Check to see if the development has received any notices from the city or village for code violations.
Maintenance of these areas allocation of funds becomes the
responsibility of a condominium association, known as a unit owners
association.
Owners will be affected by board decisions, so active participation in meetings and discussions may be beneficial.
Find out the extent to which the condominium is owner-occupied.
If most owners rent the units out, they ma be less concerned about day-to-day issues than if it's largely or entirely owner occupied. If the renter population is over 10%, are there clear rental policies, in bylaws or as an amendment?
It may be difficult to obtain financing if there is too high of a percentage of renters vs owners.
Searching for a Condo
If searching for a condominium, or for further information, please reach out to me here.
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| Jacqueline Beardsley Charles Rutenberg Realty Naperville IL jackiebeardsley.com |