I am in the process of selling my single family home and have made an offer on a condo. Could you please tell me the pluses/minuses of owning a condo. Are you glad you own a condo? Wish you didn't? What would you change? I'm afraid of assessments that might be on top of the HOA. The HOA is affordable, but if you add on assessments, that might be a deal breaker. Any advice would be appreciated.
Condo Owners
- Thread starter momtotwo
- Start date
Lynne M
DIS Veteran
- Joined
- Nov 4, 2001
Buying a condo was the right thing for me; I have no interest in doing yard work or any of the upkeep/maintenance work you need to do with a house. I'm very content to have other people take care of that for me.
There are good condo communities and not so good ones. I'd recommend doing a LOT of research before you commit to anything. I live in a community that's been in existence for 40 years, the board and building management do a phenomenal job of managing costs and keeping the building up. My condo fees have only gone up once in 6 years, and I think that was something like $25/month. Some assessments are the result of poor management (not enough money in the reserve fund, etc), and some are unavoidable. For instance, we had a horrendously bad winter a few years ago with very frequent snowstorms, and we blew through the snow removal budget. That resulted in a $180 one-time assessment. That's the only one we've had in six years.
As part of the purchase process, I received an enormous binder with the building's financial documents and financial history, insurance documents, all of the building rules and past charges to rules. It was written into the contract that I had 5 days to review all that, and could get out of the purchase without penalty if I saw anything I didn't like.
Be sure to find out if there are any outstanding lawsuits against the condo association. That actually held up my closing; the bank balked when they reviewed the suits. I'd already run them past my lawyer and he didn't find them concerning, but the bank had to do their own research.
And of course, talk to people who live in the community, if you can. I was lucky in that I lived in the apartment tower next to the condo building, so I knew a lot about the building, knew that it was well maintained and knew a lot of people who lived there.
If I think of anything else, I'll post again. Hope that helps!
There are good condo communities and not so good ones. I'd recommend doing a LOT of research before you commit to anything. I live in a community that's been in existence for 40 years, the board and building management do a phenomenal job of managing costs and keeping the building up. My condo fees have only gone up once in 6 years, and I think that was something like $25/month. Some assessments are the result of poor management (not enough money in the reserve fund, etc), and some are unavoidable. For instance, we had a horrendously bad winter a few years ago with very frequent snowstorms, and we blew through the snow removal budget. That resulted in a $180 one-time assessment. That's the only one we've had in six years.
As part of the purchase process, I received an enormous binder with the building's financial documents and financial history, insurance documents, all of the building rules and past charges to rules. It was written into the contract that I had 5 days to review all that, and could get out of the purchase without penalty if I saw anything I didn't like.
Be sure to find out if there are any outstanding lawsuits against the condo association. That actually held up my closing; the bank balked when they reviewed the suits. I'd already run them past my lawyer and he didn't find them concerning, but the bank had to do their own research.
And of course, talk to people who live in the community, if you can. I was lucky in that I lived in the apartment tower next to the condo building, so I knew a lot about the building, knew that it was well maintained and knew a lot of people who lived there.
If I think of anything else, I'll post again. Hope that helps!
The Mystery Machine
Sunrise at my house. :+)
- Joined
- Jan 4, 2001
Depends on the condo really.
Boardwalk Jedi
DIS Veteran
- Joined
- Dec 28, 2016
Yes. DH and I owned a condo when we were first married. It was not a high end condo; a very standard townhouse with no deck or garage. It was in a town that went nuts with condos in the late 80s/early 90s and now had a surplus. At the time, the original owners owed more than they could sell for so they either stayed or rented it out. The others sold as soon as they could break even or make a small profit. Needless to say, we got it for a steal.
What we liked:
No outdoor maintenance responsibilities...we weren't ready for that yet.
Ability to get out and take a walk around complex
Neighbors were normally helpful, came and went from work to wherever to home and did their own thing
Close to stores and restaurants (in our case). Most eateries delivered
Parking lots were plowed quite quickly
Halloween was an absolute blast handing out candy to so many kids
What we disliked:
The nosy, judgmental condo resident that stays home all day. Can be awful if you happen to live near or right next to her.
Privacy was great in winter, diminished in the summer. I'm not going to lie, there were nights I even turned down the TV if I heard a juicy argument in someone else's unit. I know I sound like the nosy neighbor I just complained about, but it was different...I didn't criticize the flowers other people grew or call the property management company about it.
HOA fees ran about $100 a month back then
If you aren't involved in HOA, decisions about siding, roofing, etc. will be up to others...that didn't bother us that much.
Halloween could be darn expensive since there are so many kids living there and being dropped off
As I stated before, when we lived there so did a lot of people renting cheaply...so there were some unsavory people that came and went. A few years after we moved out, most of the condoplex was occupied by owners and it just made a difference. That sounds snobby, sorry.
I would drive by and see how many units are in the complex and if a lot of kids are just hanging out and see how you like that. Is the entire complex too big? Can people sit on their decks in relative privacy? Does it just seem quieter? We have condoplex in our town where a lot of my kids' friends live that I think is a great place. Not all have garages, but all have decks/porches, fireplaces, full basements...and everyone we know just doesn't want the responsibility of taking care of a yard...I get it!!!!
Also, research the property management company to make sure they have a good reputation.
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tvguy
Question anything the facts don't support.
- Joined
- Dec 15, 2003
Interesting. I will be following this as DD is weighing her options on whether to buy a small starter home or a condo.
Seems cheaper to get a house, but you are assuming more risk if there are issues. Hopefully a good home inspector and a home warranty.
The HOA fees are many of these condo complexes seem alarmingly high for what services they are providing. We went with her to look at one condo, 30 years old, just under 1,600 square feet, 2 story, so 800 square feet of roof. No pool, no common area or facilities.. The HOA fees were $300....but had just been increase to $380 because at 30 years, they needed new roofs. Shouldn't a portion of the last 30 years HOA dues been put aside for new roofs? I mean, you know about how long a roof is expected to last, and 30 years is amazing life for wood shingles.
Seems cheaper to get a house, but you are assuming more risk if there are issues. Hopefully a good home inspector and a home warranty.
The HOA fees are many of these condo complexes seem alarmingly high for what services they are providing. We went with her to look at one condo, 30 years old, just under 1,600 square feet, 2 story, so 800 square feet of roof. No pool, no common area or facilities.. The HOA fees were $300....but had just been increase to $380 because at 30 years, they needed new roofs. Shouldn't a portion of the last 30 years HOA dues been put aside for new roofs? I mean, you know about how long a roof is expected to last, and 30 years is amazing life for wood shingles.
This horror story would be enough to stop me from ever considering one. These poor people. They all have liens on their property which are about 1/2 of the total value of the condo they own. No one in their right mind is going to buy a condo at Fair Market Value, and then agree to take on the lien which increases it 50%. They are unsellable at the moment. Can't be refinanced. It's just awful. The legal fees alone are daunting to try to get it worked out.
http://www.marinij.com/general-news/20180317/novato-condo-complex-owners-trapped-in-legal-battle
Or this charming assessment: $145,000 PER unit. Ack. And double ack.
http://www.marinij.com/article/NO/20180116/NEWS/180119835
Note that people who had bought in recently knew the siding needed upgrading, but were surprised at the size of the assessment. Can you imagine paying THAT on top of your HOA dues and mortgage?
Also, in most housing markets, in a downturn, condos get hit first, and are the slowest to recover.
I live in an HOA development, but ours is all single family homes (single level living, mostly seniors and empty nesters live here because of that), and NO commonly owned property (well, unless you count the tiny piece of land on which the monument with the name of the development on it), so no worries about special assessments, etc for repairs. That's the extent to which I would be comfortable.
http://www.marinij.com/general-news/20180317/novato-condo-complex-owners-trapped-in-legal-battle
Or this charming assessment: $145,000 PER unit. Ack. And double ack.
http://www.marinij.com/article/NO/20180116/NEWS/180119835
Note that people who had bought in recently knew the siding needed upgrading, but were surprised at the size of the assessment. Can you imagine paying THAT on top of your HOA dues and mortgage?
Also, in most housing markets, in a downturn, condos get hit first, and are the slowest to recover.
I live in an HOA development, but ours is all single family homes (single level living, mostly seniors and empty nesters live here because of that), and NO commonly owned property (well, unless you count the tiny piece of land on which the monument with the name of the development on it), so no worries about special assessments, etc for repairs. That's the extent to which I would be comfortable.
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runwad
Dis Veteran
- Joined
- Jan 18, 2006
My mom lived in a condo at the end of her life and had a bad experience so it's soured the whole concept for me. Fee's kept going up and up and what she got for those fee's kept going down and down. I've said it before, when we're ready to downsize it would be cheaper to get a smaller house and pay a landscaper to cut the grass and someone to plow the snow the few times it actually needs done than pay close to $400 for a condo fee every month. No thanks. But good luck to you, like people have said do your due diligence.
Poohforyou
DIS Veteran
- Joined
- Mar 16, 2011
Our townhouse is classified as a condo where we live. We've been here 12 years and bought as new construction. It's our 2nd townhouse and we love it. We haven't had any assessments because our HOA is managed well and money is put aside for long term things like roofs. Our monthly maintenance has gone up a few dollars each year but nothing crazy.
We've been fortunate with good neighbors. The only downside is not having a fenced yard for our dog. It was great when dd was little because there were kids all over the place. It's a nice mix now of young families, empty nesters and retirees.
We've been fortunate with good neighbors. The only downside is not having a fenced yard for our dog. It was great when dd was little because there were kids all over the place. It's a nice mix now of young families, empty nesters and retirees.
Luv Bunnies
DIS Veteran
- Joined
- Sep 3, 2006
The first home we purchased was a condo. We lived there for three years. After that, we purchased a townhouse where we lived for five years. Next, we bought a 5-bedroom house that we have lived in for 20 years. We have been discussing downsizing back to a townhouse in a few more years.
Here's why a townhouse is appealing to us at this point: Neither of us enjoys yard work. We have a gardener who comes and mows for us. DH will occasionally trim or plant something, but it's not his thing. We do not enjoy home maintenance. We've done a few things ourselves, but we're not big do-it-yourself'ers. We don't want to deal with the roof, exterior paint, fences, driveway, etc. We enjoyed living in our townhouse when all of the outdoor tasks were taken care of for us. Also, we no longer need a 5-bedroom, 3-bath house. DS22 still lives with us and because he has Asperger's, he will likely be with us for the foreseeable future. DS19 is in college across the country. He will always have a room with us, but he's not here full-time anymore. Our current house takes a lot of upkeep. It's just more house than we need.
Here's what we didn't necessarily like about our last condo/townhouse experience: The association fee and assessments can be pricey. Our condo complex was poorly managed before we moved in. They found a building defect in the balconies and they all needed to be rebuilt. I don't recall why the builder wasn't responsible, but the management company announced a $3000 assessment per unit to fix it. We actually made our first payment of $1000 and it was returned to us. Someone figured out that the association had a certain kind of insurance that would cover the defects. We ended up not having to pay anything, but it was stressful and a big hassle to attend the meetings and budget the money. At our townhouse, the association management was kind of ridiculous. The previous owners of our unit removed the tree in the front yard before we bought the place. After moving in, we got a letter saying our unit was in violation by not having a tree out front. No one called or knocked on our door to discuss it. We just got this poorly written letter that barely made sense. I called and asked why the previous owners were allowed to transfer ownership of the unit with an outstanding violation. One of the contingencies on the sale was that the sellers had to be current on their association dues and free of violations. The person on the phone couldn't answer my question and said she would get back to me. No one ever called with an answer, but we got another similar letter. I asked the association president (a resident) what was going on. She laughed and said, "Oh, would you believe there was 1/2 an hour of discussion at the last meeting about your missing tree? The management company brought it up and said you weren't responding to their letters." I said, "Yes, I did respond." I told her about my phone call and my question and the fact that the tree was removed before we moved in. If they really wanted a tree at that point, they could plant one themselves. The president told me not to plant a tree. It wasn't our problem. In five years, we didn't have a tree and the stupid letters stopped.
We are in a unique situation in that we can sell our house, pay cash for a townhouse, and have money left over. We won't have to worry about paying a mortgage, so the association fee shouldn't be a burden. We will be looking for a very specific type of house (at least 3 bedrooms, attached garage in front, a driveway we can park in, laundry in the unit (not in the garage), a small backyard (not just balconies). We don't really care about a pool or clubhouse. We will look very carefully at the association report, rules, etc.
Here's why a townhouse is appealing to us at this point: Neither of us enjoys yard work. We have a gardener who comes and mows for us. DH will occasionally trim or plant something, but it's not his thing. We do not enjoy home maintenance. We've done a few things ourselves, but we're not big do-it-yourself'ers. We don't want to deal with the roof, exterior paint, fences, driveway, etc. We enjoyed living in our townhouse when all of the outdoor tasks were taken care of for us. Also, we no longer need a 5-bedroom, 3-bath house. DS22 still lives with us and because he has Asperger's, he will likely be with us for the foreseeable future. DS19 is in college across the country. He will always have a room with us, but he's not here full-time anymore. Our current house takes a lot of upkeep. It's just more house than we need.
Here's what we didn't necessarily like about our last condo/townhouse experience: The association fee and assessments can be pricey. Our condo complex was poorly managed before we moved in. They found a building defect in the balconies and they all needed to be rebuilt. I don't recall why the builder wasn't responsible, but the management company announced a $3000 assessment per unit to fix it. We actually made our first payment of $1000 and it was returned to us. Someone figured out that the association had a certain kind of insurance that would cover the defects. We ended up not having to pay anything, but it was stressful and a big hassle to attend the meetings and budget the money. At our townhouse, the association management was kind of ridiculous. The previous owners of our unit removed the tree in the front yard before we bought the place. After moving in, we got a letter saying our unit was in violation by not having a tree out front. No one called or knocked on our door to discuss it. We just got this poorly written letter that barely made sense. I called and asked why the previous owners were allowed to transfer ownership of the unit with an outstanding violation. One of the contingencies on the sale was that the sellers had to be current on their association dues and free of violations. The person on the phone couldn't answer my question and said she would get back to me. No one ever called with an answer, but we got another similar letter. I asked the association president (a resident) what was going on. She laughed and said, "Oh, would you believe there was 1/2 an hour of discussion at the last meeting about your missing tree? The management company brought it up and said you weren't responding to their letters." I said, "Yes, I did respond." I told her about my phone call and my question and the fact that the tree was removed before we moved in. If they really wanted a tree at that point, they could plant one themselves. The president told me not to plant a tree. It wasn't our problem. In five years, we didn't have a tree and the stupid letters stopped.
We are in a unique situation in that we can sell our house, pay cash for a townhouse, and have money left over. We won't have to worry about paying a mortgage, so the association fee shouldn't be a burden. We will be looking for a very specific type of house (at least 3 bedrooms, attached garage in front, a driveway we can park in, laundry in the unit (not in the garage), a small backyard (not just balconies). We don't really care about a pool or clubhouse. We will look very carefully at the association report, rules, etc.
kaytieeldr
DIS Veteran
- Joined
- Jun 11, 2005
Interesting and suspicious that both articles cite the same project management company...
agavegirl1
DIS Veteran
- Joined
- Feb 23, 2012
Condo or Townhouse can be a great option...
1. Only need insurance for the interior (like renter's insurance) The outer building is part of Association Fees.
2. No plowing snow or mowing lawns.
3. Lower heating/cooling costs...fewer exterior walls creates efficiency.
4. Can vacation as long as you want. Just stop the mail and everything looks normal.
5. Often located nearer your work.
Caveats...
1. More rentals than owners. This indicates a value issue.
2. No HOH Reserve fund and no HOH reserve plan. A plan should have been made and dues based on funding the reserve.
3. Check realtor.com or Zillow for recent sales and values.
4. Unwillingness to share financial information by the HOH.
We have a townhouse and are on the board of directors. Ours is well run. My sister-in-law ended up in a townhouse with black mold, no functional HOH and an unresponsive management. Due to her children's health, she defaulted and moved.
We also own a home on 1.5 acres to which we will retire in a few years. A lot of work we currently don't have time for. It's a struggle to get there to mow the lawn.
1. Only need insurance for the interior (like renter's insurance) The outer building is part of Association Fees.
2. No plowing snow or mowing lawns.
3. Lower heating/cooling costs...fewer exterior walls creates efficiency.
4. Can vacation as long as you want. Just stop the mail and everything looks normal.
5. Often located nearer your work.
Caveats...
1. More rentals than owners. This indicates a value issue.
2. No HOH Reserve fund and no HOH reserve plan. A plan should have been made and dues based on funding the reserve.
3. Check realtor.com or Zillow for recent sales and values.
4. Unwillingness to share financial information by the HOH.
We have a townhouse and are on the board of directors. Ours is well run. My sister-in-law ended up in a townhouse with black mold, no functional HOH and an unresponsive management. Due to her children's health, she defaulted and moved.
We also own a home on 1.5 acres to which we will retire in a few years. A lot of work we currently don't have time for. It's a struggle to get there to mow the lawn.
antmaril
DIS Veteran
- Joined
- Apr 1, 2001
I have lived in a condo I bought from my mother-in-law (she went to a nursing home) four years ago. I really like condo living. I am widowed and it is nice not to worry about lawn maintenance and snow. My condo fees have gone up a little since I moved in, but nothing major. My heating bills are less than there were in my house and I don’t have any issues with my neighbors. My homeowners insurance is much less than it was in my home. This complex is mostly older people, but there are a few families.
I haven’t been assessed for anything yet, but I suppose it is possible. I have a friend who has lived in a large condo complex for over 40 years and has never had an assessment.
I am responsible for my decks (front and back). So, if they need new boards or refinishing, that will be on me. The condos also have skylights and if they need repair, that is also on me.
Condo living is probably not for everyone, but it works for me at this time in my life.
I haven’t been assessed for anything yet, but I suppose it is possible. I have a friend who has lived in a large condo complex for over 40 years and has never had an assessment.
I am responsible for my decks (front and back). So, if they need new boards or refinishing, that will be on me. The condos also have skylights and if they need repair, that is also on me.
Condo living is probably not for everyone, but it works for me at this time in my life.
nkereina
Last chance to lose your keys.
- Joined
- Feb 11, 2009
I have no experience with a condo, but one thing I've wondered is what happens when there is an issue with a shared wall? For instance, what if a toilet or bathtub runs over or there is a leak inside the wall causing damage to your unit? Or your unit causing damage to someone else's? I guess this is what insurance is for, but I'd be worried about contention with neighbors or ambiguity on who should pay to fix it, etc.
tvguy
Question anything the facts don't support.
- Joined
- Dec 15, 2003
Your post to me really highlights the need to read the individual rules a the condo complex you are looking at. The place I cited has small fenced in yards that the owners are responsible for maintaining. This one did have grass in the back (see photo). So you would have lawn to mow. My hat is off to the realtor, he made it clear to everyone who came to the open house that that HOA fees had just gone up, and that they did NOT include up keep of the yard within the fences around each unit. Another things I have seen that this one had, renting out your unit is prohibited.
a portion of the dues SHOULD be allocated towards logically known long term needs but unless a complex has a board that is looking at the numbers and planning for it w/dues calculations it's just like a private homeowner who doesn't think about setting aside a little money each month for these types of maintenance/repairs and then has the inevitable happen. no pool of money already in place means a big chunk of money at the time of need.
I think one of my concerns with an older complex would entail when it was built and if building codes for the area have significantly changed such that what would seem like a minor to moderate expense for repair/replacement would in fact entail costly additional work. this was an issue with an older home we purchased years ago in California-while everything passed a buyer's inspection we were cautioned and made aware of items that were getting near (or had passed) their normal 'life expectancy'. as is they were grandfathered under decades old building codes but replacements and major repairs entailed costly changes and upgrades due to newer codes.
can't you be assessed if the hoa has legal fees related to enforcing the rules on an individual homeowner or in the case of a legal action against the association or the hoa board that's not covered by the association's insurance? I would hope that built into dues would be an allocation to a legal fund but if not I could see a big assessment being levied.
I would check the rules and see if the additional stipulation that owner occupancy is required. I've known plenty of people that lived in 'no rental' communities that were non owners. they were either claimed by the owner to the board (if it was even questioned) to be a 'house-sitter' or a 'family member'.
I'm not a condo owner, but am a condo manager.
If the condo you're considering has a management company in place, you should be able to call the manager and request the current year's budget, the declaration, the bylaws, and the rules and regulations. You'll receive all of this stuff at settlement, but it's a LOT of information to get when you're already being inundated with paperwork. If the manager refuses to give you this information, you should reconsider buying there. A good manager knows that having informed buyers will make life easier for everyone.
Since you're concerned about special assessments, you should definitely look at the budget. There should be a line item for reserve fund contributions. Reserve funds are earmarked for repair and replacement of common elements that have limited useful lives, such as roofs, siding, retaining walls, concrete and asphalt. A financially healthy community will be making a decent reserve fund contribution every month out of the monthly association fees. The industry standard is to have an engineering firm complete a reserve study every 3 years. This study helps the board plan for replacements effectively. You can request a copy of the reserve study, but those may be harder to get if you're not an owner, since they tend to be very long. If the community doesn't have a reserve study, run.
As others have said, talking to current residents should help a lot. You'll get a feel for who your neighbors will be and if you're a good match with them, as well as some more in depth information about how the community is run.
If the condo you're considering has a management company in place, you should be able to call the manager and request the current year's budget, the declaration, the bylaws, and the rules and regulations. You'll receive all of this stuff at settlement, but it's a LOT of information to get when you're already being inundated with paperwork. If the manager refuses to give you this information, you should reconsider buying there. A good manager knows that having informed buyers will make life easier for everyone.
Since you're concerned about special assessments, you should definitely look at the budget. There should be a line item for reserve fund contributions. Reserve funds are earmarked for repair and replacement of common elements that have limited useful lives, such as roofs, siding, retaining walls, concrete and asphalt. A financially healthy community will be making a decent reserve fund contribution every month out of the monthly association fees. The industry standard is to have an engineering firm complete a reserve study every 3 years. This study helps the board plan for replacements effectively. You can request a copy of the reserve study, but those may be harder to get if you're not an owner, since they tend to be very long. If the community doesn't have a reserve study, run.
As others have said, talking to current residents should help a lot. You'll get a feel for who your neighbors will be and if you're a good match with them, as well as some more in depth information about how the community is run.
In most states, you can assessed for pretty much any unplanned expense that comes up. However, it's pretty rare for there to be a special assessment for legal fees. If the association has retained a lawyer to handle rule enforcement, any judgement against the offending homeowner will stipulate that they are responsible for the fees. If an owner is delinquent on their fees and a lawyer handles the collections, the unit owner pays the fees. The only time I have seen a special assessment for legal fees was in a community where the association had to sue the builder over defects. In that case, the special assessment was returned when the money was recovered by court order.
mousefan73
Germans are faster at dubbing
- Joined
- May 9, 2012
Look at the owner own use to rental ratio. Can make a big difference if most condos are rented out or if you plan to rent and you can’t. Friend had an issue as this ratio for her building couldn’t be more than 20% rented out. She wanted to rent but board declined. Not sure what legal rights she may have had ( she decided to stay anyways). As a general rule, common areas, landscaping are generally more invested when the majority of owners are self residents.
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