When considering a place to live, many people choose a condominium instead of buying a house. While it can be a good idea, there are many reasons that you should be cautious when picking a condo complex. There are some complex rules and regulations involved, so the more you research and evaluate each complex, the better you will be in the long run. Here are some of the questions you need to ask before picking your condo.
What Rules Does the Condo Association Have?
When you are buying a condo, there is a big difference between that and what you do to buy a home. If you are considering a home, you need to get a home inspection as well as find a mortgage and getting home insurance. With a condo, you have all of that, plus other details that you might not know. For example, with a condo, you don’t actually own anything outside of your four walls. The area outside and the gardens are owned by the community of condo owners. Sometimes this is an outside management company, while others are the actual residents themselves. Because it is joint ownership, any changes to the exterior or the gardens need to be approved. If this type of ownership doesn’t bother you, then there are no problems, however, if you are used to doing as you please with your property, then you might want to look at the condo association rules first.
What are the Condo Fees?
Another question you need to ask is what the condo fees are and what do they cover. The fees are usually worked out by how many condos are on the block, plus what it costs to run the community area. It usually covers grounds keeping, water and sewerage, road maintenance and trash pick-up. While these things are essential, it can also sometimes cover any additional facilities like a pool or a gym. Therefore, if you’re a gym rat or have always dreamt of having your own pool without the costs of installing one, this can be an ideal compromise you’d be willing to make.
How is the Complex Managed?
There are typically two ways that a condo complex will be managed, by a professional management company, or by a home owner’s association (HOA). If it’s being run by a management company, try to obtain the details for them and give them a call. They will often be able to tell you about the complex and give you the heads up on any problems. If an HOA runs the site, then speak to the chairman, as they will be able to tell you about the area and any issues that have arisen. It will be a good way to see if you think the complex is being run effectively, and it will give you a good indication as to the people running the complex.
Does the Association Have a Reserve Fund?
One of the most important questions you need to ask is if there is a reserve fund and how much is in it. The reserve fund is a pot of money that is there to cover any emergencies that might occur. The amount is usually worked out by the age of the condos. For those less than ten years old, it should have about 10 percent of the annual revenue budget. For condos over ten years old, it should be 25 percent or more. It is an important question to get answered when buying a condo, as you need to know that the complex will be properly maintained. If there isn’t enough money in the reserve fund, then it could cost you a lot to repair any damage. It will also give you an indication as to the health of the complex and how its governed.
Will There be Any Special Assessments?
A special assessment is when the complex needs to have some major work completed such as replacing the roofs. Instead of taking this out of the reserve fund, the association may consider using a special assessment. It will mean that your condo fees will rise by a certain amount for a set period of time. The amount raised will then cover the cost of the repairs and will leave the reserve fund intact. If there are any of these special assessments coming up, then you need to know before you decide to buy a condo with that complex.
Are There Any Lawsuits Against the Condo Complex?
One of the important things that may pose a risk in the future is if there are any lawsuits outstanding against anyone. These are usually leveled at the developers for not completing something in the complex, or for shoddy work. In most cases, these lawsuits are not a major problem, but it is good to know in advance just in case. The HOA chairman or the management company should be able to tell you this information.
What is the Parking Situation?
Parking at a condo complex can vary from place to place; typically, there should be at least one space for you as the condo owner. Some complexes have deeded parking spaces that are reserved for each condo owner. It means that only you can park in your reserved space. However, there are other complexes that run a first come first served arrangement which doesn’t guarantee you will get a space anywhere near your condo. If you like to have friends over, then you also need to check that there is guest parking available. Like with any house buying, you need to consider all these facts before moving. However, remember that if having a condo has always been a dream of yours, then there’s a condo out there for you.
These are some of the questions that you need to get answers to before you think about buying a condo. Although in many cases, all of these questions won’t be an issue, there are some exceptions, so it can save you a lot of time and money to get them answered before you move in.