What You Should Know Before Deciding to Buy A Condo

Condos can be an excellent choice for the right buyers. Here are a few things that should be considered before purchasing a condo.

One of the major attractions of condos is the low maintenance. The community area is maintained by an association funded by the dues that homeowners pay into.

Buyers should explore the development and make sure they like the look and feel of the complex and the surrounding community.

There are codes, conditions and restrictions (CC&R’s) that buyers will have to abide by once they purchase. These regulations help ensure that the community maintains its general appearance and any necessary repairs are made. Buyers should review the CC&R’s before making an offer to purchase.

Review the association’s budget. Consider that buying into a development is almost like going into business with the neighbors in the complex. It’s important to make sure that the association is running properly and has enough reserve for necessary expenses and maintenance. The budget and the CC&R’s will give you an idea about how stable the association is and if increases in the homeowners’ association dues are likely each year.

Find out how many owners in the development are delinquent on their dues. A condo complex that has a high level of delinquencies can cause problems for buyers when it comes time to get a loan or sell the condo. Some loans are not approved if the delinquency rates are higher than 15%.

Review the minutes from the association’s last board meetings. They will reveal the day-to-day issues that occur each month and give an indication of how the development is run. The minutes will also reveal owners’ complaints and if the development is engaged in any lawsuits.

Ultimately, buyers need to ensure that when they purchase a condo they’re not buying into any legal battles the association is in the middle of and that they will be able to live in their condo the way they want. Study the CC&R’s and do due diligence before buying.

? All information deemed reliable but not guaranteed. For tax, investment or ownership advice we suggest you contact an attorney or certified public accountant.