Wednesday, December 28, 2011

Buying a Condominium?

When purchasing a Condominium, it is important to know what you are buying, in terms of the actual unit, the common areas, and the Condominium Association. Condo living offers convenience, amenities, property maintenance and community living. Many considerations that must be evaluated when purchasing a condominium including total costs, condo regulations and the overall community feel of the condominium property, here are some issues.

Costs

     Condominium Association fee - This is a monthly assessment that can range from a hundreds to thousands of dollars. These fees cover the maintenance of common areas such as the lobby, elevators, hallways, parking garage, roof, facade, pool, gym, landscaping, etc.
     Unit maintenance and repairs - The interior maintenance and repairs of the individual unit are at the owner's expense. This includes all kitchen and bathroom fixtures, floor covering, lighting fixtures, painting and basically anything inside the perimeter walls of the unit.
     Special Assessments - This is a charge is imposed on all owners in addition to the regular monthly assessments. The charge is allocated pro-rata according to each unit's percentage of common elements.  It is generally related to unanticipated repairs or capital improvement projects, such as re-roofing, facade refurbishing, etc. In many cases,  a special assessment payment arrangement may be in place with a balance still owned by the unit owner. This balance is to paid by the Seller at or before closing. However, if the Seller is unable to pay off the balance, the buyer would need to negotiate the purchase price with the seller and make a request to the association to continue with the same payment terms or make other arrangements.

     Property Taxes and Insurance - Owners are responsible for the property taxes and for insuring the contents of their unit, including kitchen and bathroom fixtures, floor coverings, furniture and personal property.

Condo Regulations

Condominium regulations will dictate rules for parking, pets, noise levels, the number of people that can live in the unit.  They will also include the proper use of common areas, and specify  which changes to the exterior of the unit can be made, including painting, awnings, window treatment types and anything that has the potential to change the exterior appearance of the condominium unit.   It is important for Buyers to read the regulations carefully to ensure compliance.

Financial Stability of the Association

The Condo Association manages the financial stability of the condominium community. Potential condominium buyers should review the association's financial records to determine its ability to manage finances. The associations should have at appropriate amount of funds set aside for the day-to-day operation of the community. If the association is lacking funds, this may be an indication of poor maintenance and upkeep in the future. Another major concern is the overall status of the accounts receivable including the number and percentage of owners that are late on their monthly fees and the total amount of money due the association.

Condo living can offer you a terrific lifestyle, but it is important that you are buying into a good community with a financially strong and well-run condominium association.

Ray Princiotta is a licensed Florida real estate broker
If you have any questions, contact me at 305.494.4101 or ray@rayonrealestate.com

1 comment:

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