As many baby boomers approach the age of retirement, condominium living is an option they discuss for their next home purchase. Tired of shoveling walks, mowing lawns, and raking leaves, they start the search for a hassle-free home.
The condo option may include relocating to a retirement area that offers amenities retirees want: security, recreation, group activities, minimum upkeep and walking distance to shopping, dining, parks, church and entertainment.
Buying a condo presents some special problems that don't arise for single family home buyers though. In most condos, owners literally own nothing but air the space between the walls of their unit. Everything else-- the lawn pool, tennis courts, even the plumbing is jointly owned by all the residents.
The condo buyer must learn about any restrictions on the use of a unit, special assessments for extraordinary repairs, the financial soundness of the complex, parking provisions, environmental problems, planned repairs, and condo fees.
Ideally, condo buyers should buy in a development that has a high percentage of owner occupied units. Some lenders won't lend in a complex of mostly renters.
The condo owners association is generally elected to control and manage the overall affairs of the complex: maintenance of the common areas and exterior and trash pickup. Find out how often they have raised fees and how many owners are delinquent. A high number may mean dissatisfaction with condo management.
The financial statement will give buyers a general picture of the condo association s financial status, including how much is in accounts payable and account receivable, and the size of the reserve fund. Reviewing the minutes of the condo board meetings of the last year will reveal plans for major repairs or improvements and the special assessments needed.
Condo buyers should hire a knowledgeable attorney to review the Master Deed, the bylaws and budget, and inquire if there are any recent lawsuits or judgements against the association, whether any by-law amendments have been proposed, and whether any recent engineering studies show the projected dates for repairs of the building and its components.
Some general rules of thumb when considering a unit include:
- A poorly constructed development will mean more frequent and higher priced repairs and renovations so look for a well-built complex.
- Older projects generally have higher monthly condo fees than newer projects but beware; some dues projected on new construction condos may be unrealistic and will definitely go up.
- In the same manner that single family home shoppers should visit neighborhoods, condo buyers should visit complexes and talk to condo owners to get a sense of how they like living in the development and what the complexes are like.
- Are most of the units owned instead of rented? Owners tend to take better care of their units.
- What is the appearance of the complex? Is it well maintained or in need of sprucing up?
- Ask the owners about soundproofing and if noise has been a problem in the past?
- Is there a professional property manager caring for the complex?
- If the complex is new, what is the reputation of the developer?
