There was some hesitation in choosing to write about this topic until our most recent presentation we made for a local Condo Association in the Twin Cities. We're often invited by Condo and Townhome Associations to present a 'State of the Real Estate Market' presentation specifically associated to the Condo or Townhome association residents. We're also invited in to discuss their position to foreclose or not foreclose on their seemingly destined assets.
More often than not, the Association leadership is usually more concerned about appeasing their homeowners (particularly in a down market), than actually preserving or improving the residents ownership interests. Validating or justifying fees and potential fee increases also seems to be a very high priority. Yet, when it comes to any delinquent homeowners heading to foreclosure; many condo and townhome associations seem to leave a ton of opportunity on the table in both equity and reserves. We're helping more associations realize that foreclosures are not only a reality of the over-inflated market in the roaring 2000's; foreclosures can also be an opportunity for the entire common interest community. Part of the problem associations are experiencing with the somewhat over-correction on prices is that many Condo and Townhome Associations only focus on obtaining their rightful dues, penalties and potential assessments from the foreclosing firm when the asset is sold and transferred. Now we're helping associations consider the foreclosure destined property to also be considered an asset to the association and the common interest community. This also allows us to help them with their options associated with the decisions to retain, foreclose or apply to the appropriate investment options that could better serve their interests versus simply putting it on the market and dropping the price until someone buys it.
I wish more Condo and Townhome Associations took the time to reach outside of the box for professional support on their real estate assets. Often times, they'll resort to obtaining advice or support from the resident real estate agent or investor who again might have a conflicting interest to the remaining owners in that common interest community. Which brings me to another thought or question: Shouldn't the listing agent who is also an owner within the Condo or Townhome Association have to disclose their ownership interest on all listings they have within that same association? How about this question: Might that same agent also expose that same Condo and Townhome Association to potential liabilities associated with lack of disclosure and potential code of ethics disputes associated with that lack of disclosure? What do you think?
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