Condo Association Questions

So you are thinking about buying a condo but you are not sure where to start.  There are many aspects to buying condos such as what areas, how big and what condo association questions should I be asking.  Condo associations were originally created as a legal entity for the purpose of developing, managing and selling the development.  It allows the developer to exit the financial and legal responsibilities typically by transferring ownership to the condo owners after selling off a pre-determined number of units.  Once this is done the important thing for any condo buyer to know regarding the association that will be overseeing their common property is what are the responsibilities of all involved?  You are spending your hard earned money and the last thing you want to do is get stuck with a lemon or live someplace that is not what you expected.

There are a lot of condo association questions to ask before you buy but we will only cover a few. 

• 1. Ask to see the condo association board meetings minutes. What have the owners been talking about, what are their concerns and issues, are there a common thread for some of the complaints, etc.
• 2. What is the renter to owner percentage? If the renter population is very high are there rental policies in place either in the bylaws or by an amendment. Always remember the association can change its bylaws so make sure you are well informed of any changes.
• 3. Ask for a copy of the certificate of insurance from the association which is a summary of the association's policy. Are the replacements costs enough to cover rebuilding if need be? Another important area to question regarding the association insurance policy is if it has a building ordinance clause. This clause insures that the building will be up to the current code if rebuilding is required.
• 4. How much is the repair fund? This will tell you if the association has the funds available for maintenance. If the fund is not high enough then the complex may not be as well kept as it should be or be living beyond its means.
• 5. Ask to see the delinquency rates of the current owners. When people do not pay their association dues on time it may be a sign of discontent and you will need to find out why.

Asking the right condo association questions is as important as finding the right real estate agent or the right financing.  We all want to make sound financial decisions and the only way to accomplish this is with the right questions.