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The 6 Most Important Questions to Ask When Buying a Condo

Condominium living is becoming very popular.  We have an aging population that are giving up there single family homes to enjoy a more maintenance free living.  We have the younger generation getting married later and later, into their late 20's or 30's.  They are upwardly mobile with good stable jobs.  They want to own, but don't want the hassle of owning.  Condominium living can be a great choice for them an many others.

When you are buying a condo it is important you are buying a piece of the whole.  You usually just have control from inside stud to inside stud.  After that their are other people making decisions that govern the complex.

What are the rules and what's mine?

Ask to see the master deed, unit deed and the bylaws.  It will tell you what is yours and what is owned by the condominium.  Common areas are owned and enjoyed by all and is maintained by all (tennis courts, pools, etc...).  Exclusive common areas are enjoyed by one or few and is maintained by all (decks, parking spaces, etrc...) The unit deed will usually tell you if the parking spots are owned by you or are assigned.  In some areas owning a parking spot could be a difference in price of $30-40K.  Know what you own and are responsible for.  Windows and sliders can go either way, it can be the owner responsible for replacing or the association. I've seen many weird things in condo docs, I owned a condo where we were responsible for replacing the roof...... what a surprise that could be when that time came.

 

Whats going on? 

Ask to see the past year's minutes of the association meetings.  It tells you how things are running.  Whats the turnover rate? Are things getting done?  Are they just petty greivance sessions?  What is coming around the corner for repairs?

How well has it been managed?

Ask what special assessments have been levied in the past 5-10 years.  It lets you know how well money has been managed. Are they collecting enough condo fees to cover expenses.  There is nothing worse than going along thinking your condo fee covers all maintanence and then get wacked with a $3,000 special assesment to repave or replace roofs. etc...  Remember your condo fees pay for many things, you want your condo fees to reflect ongoing maintenance.

 

Who are my neighbors?

What' the ratio of renters to owner occupied?  That gives you an idea of the mentality of the owners.  If there is a high rate of investors owning units, they want to operate on a zero budget and want to spend as little many as possible.  Heck, they don't live there, what do they care.  Ask you Realtor to determine what the turn over rate is in a complex.  Some complexes have a high owner turnover because of price point.  Younger buyers buy, than sell in a few years to move on to bigger and better things.  These owners generally don't want to spend much money on maintanence.   If your going to be a long term owner that can be frustrating.

 

What am i walking into?

 Ask if there are currently any special assessment's or future assessment's.  Many times you can get the seller to pay any current assessments at closing.  You also want to know what might be coming up in the future for assessment's already voted for.  The minutes will also  let you know what future repairs and replacement's that are coming up but not voted on. 

                                                               

                                                                          How much money is kicking around?

Ask what is in the reserve fund and the current years budget.  Every association should want to build a reserve fund for emergencies and future repairs and replacements so owners don't have to constantly  dip into their pockets.  The budget will usually shows last years buget and the curret years proposed budget.  Are they meeting there financial responsibilities or are they running a deficit.  In this climate it is important to ask how many people are delinquent on there condo fees.  You can't cover the budget if no one is paying.

 

 

Condominium living can be very satisfying, but there not always what they seem at face value.  Get the fact's and make an informed decision!!

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