Here are nine questions to ask the condo board.
When you buy a condo, you join an association of owners that determines everything from whether to plant perennials in the courtyard to how to finance a major amenity or roof project. Before yo ubuy, contact the condo board with the following questions. In the process, you'll learn how responsive and well organized its members are.
1. What percentage of units are owner occupied?
- Generally the higher owner occupied percentage the more marketable the units will be at resale (unless you are in a resort community this will vary).
2. What covenants, bylaws, and restrictions govern the property?
- Is there a grandfather clause in place?
- you may find, for instance, that those who buy a property after a certain date can't rent out their units, but buyers who bought earlier can.
- Ask for a copy of the bylaws to determine if you can live with them
3. How much does the association keep in reserve?
- How is that money being invested?
4. Are association assessments keeping pace with the annual rate of inflation?
- Smart boards raise assessments a certain percentage each year to build reserves to fund future repairs.
- To determine if the assessment is reasonable, compare the rate to others in the area.
5. What does and doesn't the assessment cover - common are maintenance, recreational facilities, and trash collection?
6. What special assessments have been mandated in the past five years?
- How much was each owner responsible for?
- Some special assessments are unavoidable.
- But repeated, expensive assessments could be a red flag about the condition of the building or the board's fiscal responsibility.
7. How much turnover occurs in the building?
8. Is the project in litigation?
- If the builders or homewoners are involvedin a lawsuit, reserves can be depleted quickly
9, Is the developer reputable?
- Ask Residents about their perception of the developer.
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