I have been in the real estate business for many years and just thought I would write something that buyers should pay close attention to when purchasing a condominium that many realtors and buyers often overlook.
1. The Condo Plan or Tract Map
The Condo Plan and Tract Map will show you exactly what you own versus what is a common area. This should clarify what parts of the property you are personally liable for and what you have to pay in dues to your Home Owner Association (HOA) to maintain.
2. Covenants, Conditions and Restrictions (CC&Rs)
Make sure you have read through the CC&Rs and are comfortable with accepting all their terms before you close escrow. Once you have closed escrow you are legally assumed to have accepted each CC&R term.
3. Articles of Incorporation of the HOA
The Articles of Incorporation will give you an idea of what the HOA is authorized to do.
4. By-Laws and Operating Rules
The By-Laws and Operating Rules are important to you as they determine how the HOA members are elected and what your rights up front when dealing with your HOA.
5. Reserves
HOA Reserves are something you should pay special attention. Given the current economic environment, some HOAs are not receiving all their dues. This is causing a short fall in revenues. Those that are not well funded are increasing their HOA dues or charging owners assessments. Also, many banks are no longer lending to potential buyers in buildings where there are significant HOA delinquencies or large assessments.
I hope these tips help you and if ever I can be of any assistance just contact me, Greg Bryan, your San Francisco Real Estate Solution Specialist.
1. The Condo Plan or Tract Map
The Condo Plan and Tract Map will show you exactly what you own versus what is a common area. This should clarify what parts of the property you are personally liable for and what you have to pay in dues to your Home Owner Association (HOA) to maintain.
2. Covenants, Conditions and Restrictions (CC&Rs)
Make sure you have read through the CC&Rs and are comfortable with accepting all their terms before you close escrow. Once you have closed escrow you are legally assumed to have accepted each CC&R term.
3. Articles of Incorporation of the HOA
The Articles of Incorporation will give you an idea of what the HOA is authorized to do.
4. By-Laws and Operating Rules
The By-Laws and Operating Rules are important to you as they determine how the HOA members are elected and what your rights up front when dealing with your HOA.
5. Reserves
HOA Reserves are something you should pay special attention. Given the current economic environment, some HOAs are not receiving all their dues. This is causing a short fall in revenues. Those that are not well funded are increasing their HOA dues or charging owners assessments. Also, many banks are no longer lending to potential buyers in buildings where there are significant HOA delinquencies or large assessments.
I hope these tips help you and if ever I can be of any assistance just contact me, Greg Bryan, your San Francisco Real Estate Solution Specialist.
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