Is a condo a good purchase?

 Is a condo a good purchase or not? Maybe!

• Traditionally condo's have been a good place to start for the first time homebuyer, because they can be very affordable. They often have nice facilities, like pools and play grounds, tennis courts and some even have gyms so nice you can give up your club membership. Ah, but they do have issues. These are some of the things to consider before buying a condo.

• Financing can be tough! Ask your lender to do a search on the complex of interest, and see if the unit conforms to their rules. Lenders have guidelines and condos often raise red flags on some of these guidelines. The ratio of renters to owners, the amount of reserves for repairs, and the number of vacancies in the complex all affect the risk for the lender. There are many condos in the Inland Empire that require all cash, no financing available at all. Of course this affects the price going in and going out.

• Check out what are the residents complaining about and concerned about. The minutes will give a buyer a good idea about what subjects come up in the homeowner meetings and board meetings. Read the minutes.

• How are dues collections going? This is one of the red flags if there is a short fall of the association funds. These funds are used to buy master insurance policies, make repairs, pay for landscaping and general maintenance. This fund needs to be healthy for the enjoyment of every resident.

• Check out the association for legal issues. See if there are any pending law suits and if there are dig in to see if they might be a problem for you at some point.

• Review the master insurance policy with an insurance professional to see if the property has adequate replacement coverage. Even new buildings and associations need excellent insurance; builders cover flaws in the early years but their liability is exhausted quickly if some major system failure occurs. The buildings must be covered. I have seen an entire complex have faulty roofs and the builder was bankrupt, proper insurance is a must! Budget for your own coverage also, because many of the master policies are "bare walls" and will not restore your unit inside the interior walls if you had a fire or water damage.

• Find out just how renter friendly the association is and what the rules are for renters and landlords. There should be bylaws and leasing rules. Look for pet rules and noise policies.

• The homeowner dues can be a good clue about what has happend within the complex over the years. For example, La Paz in South Temecula has signifiacant HOA dues as a result of heavy maintance expenses a few years ago. The managment has repaired fences, roofs and common areas, much to the delight of the homeowners, but the funds had to be replaced. 

• Talk to other owners, they will be able to tell you about the management company. Are they aggressive or passive, too quick to fine or too slow to respond?

 Condos can be great living, they come in all shapes and sizes but do your homework and avoid       disappointment! Murrieta and Temecula are blessed with newer complexes so repair problems are minimized. This is certainly not a guarantee, but in general newer means fewer building issues.