Who IS the developer? Florida has a very strict successive developer law. The developer that is responsible for warranties and liable for other major issues just may be a bank or some other investor and not the large developer that built the project. Investigate this thoroughly and get a good agent working on your behalf that can intelligently get these answers and advise you of the ramifications.
Who is carrying the warranties and what is the policy on warranties for things like appliances, punch out items for the condo and major structural items such as concreteand doors? Many of the subcontractors for things like the pool, the concrete work, and the tile may now be out of business. If the condo you are buying is three years old yet has never been lived in, is there still a warranty? Who do you call if when you move in you find that the hot and cold water lines were mistakenly crossed or your doors don't work?
How many condos in the community are paying their assessments? If you buy a condo for $179,000 and the condo fees are $900 per month it is a safe bet that only a small portion of the condos are actually paying the condo fees. How does this affect you? What will the fees be in two years? In five?
Who built the condominium? This is different from who developed it. Are they still in business? What is THEIR policy on latent defects? Do they have the money and resources to back up their warranties? A good agent will contact the builder for you and get these answers.
Who is managing the condo association and has the project been turned over to the owners from the developer? The condo association is likely very busy with issues like un collected fees, estoppel letters for foreclosed properties, and other problems associated with today's recession; so to get answers from them you may have to make a personal visit. I would do so or insist that your agent do so on your behalf. You can learn a great deal about issues like insurance, warranties, the percentage of owner occupieds and other problems or challenges the community will face in the future. Most associations are run by a management company that is paid so much money per month, per door. They hire the common area maintenance contractors and deal with all items not associated with the individual homes.
2 Comments on Five Things You Need to Know about a Condo Before you Buy
SEP
27
2009
Gregg,
Some very helpful points. One more thing I would add is to find out how many units are rented out. Mortgage companies frown upon too many rentals and the buyer may not get financing.
Jeana Cowie, Broker Associate, Re/Max Real Estate Ltd., Bergen County, NJ
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Some very helpful points. One more thing I would add is to find out how many units are rented out. Mortgage companies frown upon too many rentals and the buyer may not get financing.
Jeana Cowie, Broker Associate, Re/Max Real Estate Ltd., Bergen County, NJ