For investors and homeowners alike, condos can be a great investment. They’re usually smaller than your typical home, which automatically means a lower cost of ownership. They’re fairly easy to maintain and you’ll never have to cut grass or maintain the landscape.
However, all this convenience comes at a price, and buyers who are considering condos for sale will need to know exactly what they’re getting into before signing on the line.
Consider these seven red flags that could indicate you might be getting a worse deal than you think.
1. Basic Maintenance Isn’t Being Performed
Take a walk around the condo complex. Does it look like the walkways are swept, the roof is in good condition, the light fixtures work, and the parking lot is even and well painted? If not, you might want to keep looking.
Condo owners pay monthly fees to a homeowner’s association to handle general upkeep. This money covers a lot of things, like replacing roofs, cleaning up after a storm, paying for parking lot lighting, painting or cleaning the exterior of the condos, and other expenses.
But if basic maintenance isn’t being performed, it does little to instill confidence that the condos themselves have been maintained.
2. Neighbors Aren’t Paying Their HOA Fees
As a potential condo buyer, you have the right to look at the HOA financials to see how money is being spent, how much money they collect, and how much money is in reserve. But if more than 10% of your neighbors aren’t keeping up with their HOA fees, run.
HOAs can’t operate efficiently if they don’t have everyone contributing. This means that when maintenance is needed, the association will either use a bottom-of-the-barrel contractor or cut corners to save money. And when this happens, your condo could go down in value because the property hasn’t been well maintained.
3. There Hasn’t Been a Recent Tax Assessment
When the housing market collapsed, the value of many condos tanked. But unless they’ve had a recent tax assessment, you could be paying taxes based on the old value of the condo.
Make sure you ask to see tax statements and what the condo is valued at. If the two aren’t aligned, you can ask to have the condo reassessed, but that could take a long time.
4. They Don’t Have a Resale Package
A resale package is a collection of documents from the HOA that includes the budget and financials. If you’re buying a condo, you can request to view the resale package to see if the overall financial health of the community is up to par.
But if the association doesn’t have a resale package, walk away as quickly as you can. There could be something they don’t want you to see, likely because it could result in you backing out of the deal.
This post was written by a real estate expert from the Dotoli group. Josh Dotoli is Paramount Residences #1 Selling Realtor with nine sales in 2021, 3x more sales than any other Realtor selling in the building. The Paramount Residences enjoys a prime beach area location. It is a Ft. Lauderdale oceanfront condo located across from the beach. Looking for a Paramount Fort Lauderdale Floor Plans? Contact us today!