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Home arrow Real Estate News arrow General News arrow What to be aware of when buying a condo
What to be aware of when buying a condo Print E-mail
Tuesday, 19 September 2006

Ownership of condominium units is a popular move by buyers in the US.  It seemed that condo developments are a win-win situation for everybody.  For builders, they can represent a strong return on investment. 

Condominiums come in all shapes and flavors. The newest breed is found in the urban areas. This is partly due to the trend towards urban renewal and redevelopment that is found in many portions of this country.

The types of developments have different names in different states. Unit owners are responsible for and own the interior of the living spaces, often to the finished walls.

The association is responsible for the areas beyond the finished walls, typically the structures themselves, the plumbing, the common sewer lines, etc.

In addition, there are common elements that are controlled by the association. Typically, this might include pathways, recreation facilities, swimming pools, tennis courts, and anything else that is for the benefit of the association.

A limited common area might be a part of the lawn that's fenced off for the use of a particular unit owner.

These are general observations. Before you purchase you must read the master deed, the bylaws and every other governing document to find out what you will own and what you will not own.

Condominium projects, with little exception, look wonderful when first built. After they are occupied by property owners, control shifts from the builder to the individual unit owners. At that time, the unit owners run the condominium association and begin full control and responsibility for the common elements.

The success of the condominium association is directly related to the caliber of the association. If the association board of directors is functioning properly and has good legal counsel and other professionals, then the entire community may be an exciting, desirable place to call home.

On the other hand, if the association is falling apart, if nobody wants to volunteer, if it's not governed by capable, caring people, if it doesn't retain quality professionals, or it isn't properly collecting the monthly assessments from the unit owners, then the community probably won't be a desirable place to live. And people are probably not going to continue to live there.

Above and beyond the normal kinds of things that you need to do, you absolutely must look at the condominium records and documents. Take a look at the minutes. Is this a properly run, stable organization? Are there constant resignations; does it appear that little ever gets accomplished?

There is no getting around the fact that due diligence in the case of a condominium purchase requires an examination of the Association records and legal documents. Examine them and ask questions before purchasing. I suggest having an attorney help you understand the association and its workings. This is an inexpensive service, and may prove down the road to be a very worth while investment.


Edwina Baniqued

 
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