Condo living has definite advantages but it can also create unexpected, and potentially unpleasant, scenarios if you jump in without doing your research.
If you're thinking about buying a condominium or townhouse but have not yet lived in a Common Interest Community, or CIC (condo, townhouse or co-op), ask these questions before finalizing any offer:
What's the monthly association fee and what does it cover? Which utilities are shared? Which utilities are paid for by individual units?
How is the water use metered? Does each unit pay for individual usage? Or is is split evenly?
Can heat be controlled in each unit? Or, is their a central thermostat?
Are pets allowed? If yes, which ones and how many? Are there weight, size or breed restrictions?
Is the association self-managed? If yes, do the members get along? If not, who manages it and how reputable is the company?
How much money is in the reserve account for future maintenance projects?
What's the association's annual budget?
Who is on the board? Try to talk to a board member directly.
Do the other owners have the right of first refusal in the sale of other units?
Is there additional storage for each unit? Where? Does it cost extra?
Are there any pending building repair/improvement projects? If yes, what? How much is proposed? Are costs split evenly among units? What other future projects have been discussed?
Is smoking prohibited? Do any of the residents smoke?
How sound proof is the building? Can you hear noise in other units?
Who lives in the other units? For how long? Are they owner-occupied?
Are long-term rentals allowed? If yes, how many? What percentage can be rented at any one time?
Are short-term rentals (like Airbnb) allowed? If yes, are any units currently being used as Airbnb rentals?
Where is the common space? Who maintains it?
If there's shared laundry, what's the system for using it?
If there are unassigned off-street parking spaces, what's the system for using them?
Can I make changes to my unit? What, if anything, is restricted?
You may not get answers to all of these questions but at least be mindful of your living space needs and aware of any restrictions that may affect them.
Statutory Rescission Period
When making an offer on any CIC (Common Interest Community) governed by a Minnesota HOA (Home Owner Association) you have a 10-day period to view all association documents and cancel the offer without penalty. This recession period begins once the last of the docs* has been received (agents should be working diligently to get them delivered as quickly as possible.) Hiring an attorney to review the documents is always a good idea!
* Minnesota requires sellers to provide the following HOA documents:
Declaration
Articles of incorporation
Bylaws
Rules and regulations
Amendments or supplemental declarations
Organization and operating documents, including budgets and financials
Resale disclosure certificate
Heidi Swanson is a Realtor® based in St. Paul, Minnesota. She writes a blog to share information on a variety of real estate related topics including buying and selling, market conditions, homeownership trends and more. Reach her at heidi@lyndenrealty.com or 651-503-1540.