Condominium Law
In most states, condominiums do not have a corporation set up to be responsible for the liabilities, taxes and governance of condos, PUD's or condotels. That is why each state has a special set of condominium laws detailing how condos must be organized and operated. These laws require each condominium project to file a declaration and by-laws, with specific requirements regarding the rights and duties of the association. Condominium statues vary considerable from state to state and many times lack protection for the consumer. While some states provide only the barest framework for creating and governing condominiums others are very complex and can be confusing. Before you buy a condo it would be a good idea to obtain a copy of the state law and consult a trusted real estate attorney.
Condominium law can be quite confusing with all the definitions and time well spent may be the key to making a good decision if you are a first time homebuyer or a seasoned homeowner purchasing for the second or more times. Some important definitions are contained and been paraphrased in the interest of space.
Declaration - the instrument by which the property is submitted to the provisions of the act. Declarations can be amended from time to time depending on local or state laws.
Unit - means a part of the property designed and intended for any type of independent use.
Common elements - means all portions of the property except the units.
Unit owner - means the person or persons whose estates or interests, individually or collectively, aggregate fee simple absolute ownership of a unit.
Condominium instruments - all documents and authorized amendments thereto recorded pursuant to the provisions of the Act, including the declaration, bylaws and plat.
Common expenses - means the proposed or actual expenses affecting the property, including reserves, if any, lawfully assessed by the Board of Managers of the Unit Owner's Association.
Association - the association of all the unit owners, acting pursuant to bylaws through its duly elected board of managers.
Reserves - those sums paid by unit owners which are separately maintained by the board of managers for purposes specified by the board of managers or the condominium instruments.
The condominium law definitions above are from the Illinois Condominium Property Act first established in 1963. Today the popularity of condo living has exploded throughout the country and laws governing these types of properties are being looked at closely. With baby boomers entering the market interested in moving away from the traditional detached homes, condo living has become much more attractive and laws governing them can be very important.
How to Invest in a Real Estate Rebound
For decades - and especially the last decade - investors seeking income have been advised to allocate a portion of their assets to real estate. After all, real estate offers a relatively high level of income (up to a 15% rental yield in some locations) and - as a hard asset - offers at very least some protection of principal.
In recent years, investors often sought diversification into real estate through real estate investment trusts (REITs), since owning actual properties outright was too expensive for the average retiree or income investor.
Bubble-era housing prices and the low interest rates that fueled them made it more attractive than ever for developers to build condos all around this country, but a recent decline in households' net worth, coupled with tighter lending standards, has made it harder than ever for developers to sell their properties. This bust for lenders has been a boon for savvy investors.
By employing a real estate auction company, savvy investors are able to pick up condominiums in desirable locations like New York, Chicago, and Los Angeles for sometimes less than half of their original asking price.
And the case for buying condo properties now is compelling for many reasons. First, as an income-producing asset, real estate is almost unrivaled, since income can be realized in perpetuity (or until the building collapses) - try getting that yield with a bond!
Second, the prices that many investors are paying through a real estate auction company often augment those yields and account for a good deal of greater downside in the market. Third, as a hard asset, real estate will outperform bonds or cash in an inflationary environment. And fourth, real estate is useful - it can be used as a residence. What high-yielding stock provides walls and central air?
Joking aside, most metropolitan real estate markets have taken huge hits, but there are some signs of stabilizing. The buyers who will make the most money in an inevitable long-term rebound in real estate are those that are willing to stick their necks out early.
Owning a condo offers an alternative to owning a soft-asset REIT for diversification and has the added bonus of being a hard asset that investors can live in or pass on to children, grandchildren, etc, and the ability to buy at auction offers the opportunity to get away with paying prices that - years from now - will seem impossibly low.
Condominium Law
In most states, condominiums do not have a corporation set up to be responsible for the liabilities, taxes and governance of condos, PUD's or condotels. That is why each state has a special set of condominium laws detailing how condos must be organized and operated. These laws require each condominium project to file a declaration and by-laws, with specific requirements regarding the rights and duties of the association. Condominium statues vary considerable from state to state and many times lack protection for the consumer. While some states provide only the barest framework for creating and governing condominiums others are very complex and can be confusing. Before you buy a condo it would be a good idea to obtain a copy of the state law and consult a trusted real estate attorney.Â
Condominium law can be quite confusing with all the definitions and time well spent may be the key to making a good decision if you are a first time homebuyer or a seasoned homeowner purchasing for the second or more times. Â Some important definitions are contained and been paraphrased in the interest of space.
Declaration - the instrument by which the property is submitted to the provisions of the act. Declarations can be amended from time to time depending on local or state laws.
Unit - means a part of the property designed and intended for any type of independent use.
Common elements - means all portions of the property except the units.
Unit owner - means the person or persons whose estates or interests, individually or collectively, aggregate fee simple absolute ownership of a unit.
Condominium instruments - all documents and authorized amendments thereto recorded pursuant to the provisions of the Act, including the declaration, bylaws and plat.
Common expenses - means the proposed or actual expenses affecting the property, including reserves, if any, lawfully assessed by the Board of Managers of the Unit Owner's Association.
Association - the association of all the unit owners, acting pursuant to bylaws through its duly elected board of managers.
Reserves - those sums paid by unit owners which are separately maintained by the board of managers for purposes specified by the board of managers or the condominium instruments.
The condominium law definitions above are from the Illinois Condominium Property Act first established in 1963. Today the popularity of condo living has exploded throughout the country and laws governing these types of properties are being looked at closely. With baby boomers entering the market interested in moving away from the traditional detached homes, condo living has become much more attractive and laws governing them can be very important.
Condo Law
In most states, condominiums do not have a corporation set up to be responsible for the liabilities, taxes and governance of condos, PUD's or condotels. That is why each state has a special set of condo laws detailing how condos must be organized and operated. These laws require each condominium project to file a declaration and by-laws, with specific requirements regarding the rights and duties of the association. Condominium statues vary considerable from state to state and many times lack protection for the consumer. While some states provide only the barest framework for creating and governing condominiums others are very complex and can be confusing. Before you buy a condo it would be a good idea to obtain a copy of the state law and consult a trusted real estate attorney.Â
Condo law can be quite confusing with all the definitions and time well spent may be the key to making a good decision if you are a first time homebuyer or a seasoned homeowner purchasing for the second or more times. Â Some important definitions are contained and been paraphrased in the interest of space.
Declaration - the instrument by which the property is submitted to the provisions of the act. Declarations can be amended from time to time depending on local or state laws.
Unit - means a part of the property designed and intended for any type of independent use.
Common elements - means all portions of the property except the units.
Unit owner - means the person or persons whose estates or interests, individually or collectively, aggregate fee simple absolute ownership of a unit.
Condominium instruments - all documents and authorized amendments thereto recorded pursuant to the provisions of the Act, including the declaration, bylaws and plat.
Common expenses - means the proposed or actual expenses affecting the property, including reserves, if any, lawfully assessed by the Board of Managers of the Unit Owner's Association.
Association - the association of all the unit owners, acting pursuant to bylaws through its duly elected board of managers.
Reserves - those sums paid by unit owners which are separately maintained by the board of managers for purposes specified by the board of managers or the condominium instruments.
The condo law definitions above are from the Illinois Condominium Property Act first established in 1963. Today the popularity of condo living has exploded throughout the country and laws governing these types of properties are being looked at closely. With baby boomers entering the market interested in moving away from the traditional detached homes, condo living has become much more attractive and laws governing them can be very important.
How Condo Law Applies to you
Many condo residents are unaware of the condo law that presides over their condominium building. But these laws directly affect these residents and the amount of money that they pay in assessment fees. Your condo has a board of members that choose an association that takes care of the needs of the residents. The association is responsible for providing a number of services for the residents and they must always make sure that they are within the condo law in all of their dealings. In order to ensure that residents are satisfied with the performance of their association you must choose a reliable company to manage your condo. All condo association management companies are not equal in the quality of service that they can provide.
A lot of residents are often unhappy with the association representation that they currently have. Many of them complain of high association fees that garner them little attention from the association. When a condo owner has a concern, a question, or a complaint, they should be able to communicate it to the association immediately. Condo association management companies need to work with the condo owners to find solutions to any problems that they may have. Your condo association provides you with a service that you pay for, you have every right to expect that they treat you with courtesy and that they carefully listen to any problems that you may be having and that they rectify them in a timely manner.
The association is responsible for providing a number of services including collecting monthly association fees from residents and initiating collection proceedings if necessary, resolving disagreements between condo owners, organizing daily maintenance of the property, conducting board meetings with members, assessing potential improvements to the property, actively exploring and employing ways to guarantee that the property run efficiently, and performing general accounting duties. They are also responsible for handling developer and turnover issues and civil litigation.
Condo associations are charged with the responsibility of resolving disagreements with unit owners, contractors, management companies, and even local governments. They must follow all pre-described condo law that regulates these matters. Your condo association should always work with its residents and remain within the law. They must be prepared to file lawsuits against contractors that do not perform work in accordance with pre-established contracts. Whenever these disputes arise, your association should be ready and able to take the necessary steps required to negate the issue.
Condo Law
So you want to buy a condo. What are the steps? Where does “condo law†come into play? Condo law is important for all condo buyers to understand. What are your rights as a condo owner? Are you buying just the space inside your four walls or parts of the complex?Â
Let’s start with the condo contract. You’ve been out with your condo specialist and they’ve shown you dozens of condominiums you’ve inspected. You narrow your search and now you want to start making offers. The first step is to interview condominium attorneys that understand condo law. There are thousands of lawyers out there, but only a handful really understand Condo law. Once the process of interviewing is over and you feel comfortable with the attorney you chose, you need to review the condo contract process. What are the questions you need to ask your condominium specialist about the transaction? Your attorney should give you a handful of questions to get started.
Condo law starts with the real estate sales contract. After you’ve signed the contract the next step is to get “condo financingâ€. Who will finance the condominium for you? What lender specializes in condos in Chicago? Again, the process is to interview a number of financing people that specialize in the financing of condos. Once you’ve narrowed down your search, begin the negotiating process to see how you can get the best interest rate and loan program there is. Remember, this is one of the biggest financial moves you may make in your life. If you negotiate even a quarter percent lower on your loan, it can mean the difference of thousands of dollars in savings in years to come.
Now you are to close on your condominium. The day of closing your “condo attorney†will be present to have you fill in all the documents from the condo lender. The attorney will read each document to you and then you sign. This will go on for an hour and then all parties will get up from the closing table and you’ve bought yourself a condo.Â
As a condo owner, it’s imperative that you learn the condo laws in your state. There are changing laws from state to state annually. The best suggestion is to review things with your attorney about the condo association and your rights as a condo owner. In the end, you’ll walk out of the closing with confidence that you know what you’re doing as long as you’ve done your due diligence. Condo owning can be a great experience as long as you go into it with your eyes wide open and you’ve done your homework.
Condo Fair Housing
It's been 40 years since U.S. President Lyndon Johnson signed the Civil Rights Act of 1968, also known as the Fair Housing Act. What does this landmark legislation mean?
The 1968 act expanded on previous acts to prohibit discrimination concerning the sale, rental, and financing of housing based on race, religion, national origin and sex. It was amended in 1988 to include handicap and family status.
Housing discrimination had already been prohibited for more than 100 years previously, thanks to the Civil Rights Act of 1866, but ironically there were no federal enforcement provisions as part of that act. The enforcement "teeth" would not come about until the 1968 act was signed into law. In fact, some local states, municipalities and/or counties have expanded further on the federal act. Be sure to check locally for more information.
Realtors, including the condominium specialists at OwnACondo.com, abide by a Code of Ethics that requires "Equal professional service to all clients and customers irrespective of race, color, religion, sex, handicap, familial status or national origin." Read a summary of the REALTOR Code of Ethics here.
Here's the Fair Housing Act of 1968 in its entirety.
