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Old 10-07-2016, 10:31 AM
 
Location: Denver CO
20,952 posts, read 11,615,689 times
Reputation: 31803

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Quote:
Originally Posted by ohhwanderlust View Post
If condo owners are randomly hit with $30,000 fees at the management's whim, how is that sustainable? Is it a nerve-wracking way to live?

I understand houses need repairs too, but at least you have the choice whether to have them done or not. You won't have a lien put against you.
Quote:
Originally Posted by ohhwanderlust View Post
Oh, we don't have a condo yet. My husband just said that it's common to be regularly hit with huge special assessment fees in condos.

I guess a newer, well-reviewed condo would be the safest bet. The states we're considering are Oregon or Washington.
Condos do not assess anything at "management's whim." Only the board, and depending on the by-laws, sometimes a majority of the unit owners, can agree to these kinds of expenditures.

You should be checking the finances of any association you are considering buying into, and make sure they have a current reserve study and adequate reserves to meet expected obligations as well as adequate insurance to meet unexpected needs, which are most commonly from an unexpected and unplanned occurrence generally covered by insurance. Any association that would need a 30K per unit special assessment to cover routine maintenance, repair and replacement is a very poorly managed association and that would be reflected in the financials and other documents subject to review prior to purchase.

And tell your husband to stop repeating false information about a subject he is clearly quite uninformed about.
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Old 10-07-2016, 10:35 AM
 
Location: Saint John, IN
11,036 posts, read 3,934,497 times
Reputation: 13526
Quote:
Originally Posted by ohhwanderlust View Post
If condo owners are randomly hit with $30,000 fees at the management's whim, how is that sustainable? Is it a nerve-wracking way to live?

I understand houses need repairs too, but at least you have the choice whether to have them done or not. You won't have a lien put against you.
Large assessments could be claimed under "loss assessment coverage" on you condo insurance policy. This is not a standard coverage; however, but a good agent should recommend it for all condo owners!


As others have already said, a "large" assessment is not common. Can it happen? Sure, but that is why you look at the board financials before making the purchase as well as what updates had already been done to the building and what needs to be done. My mother has owned a condo for 15 years and has never once had a large assessment. The building is 28 years old and even though they have done some major updates (such as the roof) they always had enough in the reserve to cover it, therefore, no special assessment.

Last edited by CGab; 10-07-2016 at 10:46 AM.. Reason: Add info
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Old 10-07-2016, 12:14 PM
 
4,541 posts, read 8,374,838 times
Reputation: 6516
Quote:
Originally Posted by Jbeechuk View Post
I can't imagine living in a condo where these massive assessments happen. It's nothing but poor management by the board. It's inexcusable to not be collecting enough money to put in the bank. I understand unexpected things can happen, but that is what contingency funds are for. I guess buyer beware is the name of the game here.
Yes inexcusable, but its done by vote. Typically what I see is owners, especially elderly, vote to keep assessments very low because they are going to go into assisted living or die soon anyway, will not see the money used in their lifetime. So they vote to keep assessments the same. Forever.

Then.......... something bad happens, like a roof. And a special assessment must be made because there is no money in the accounts to cover it.
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Old 10-07-2016, 12:51 PM
 
Location: Columbus, OH
915 posts, read 669,312 times
Reputation: 1347
Quote:
Originally Posted by 399083453 View Post
Yes inexcusable, but its done by vote. Typically what I see is owners, especially elderly, vote to keep assessments very low because they are going to go into assisted living or die soon anyway, will not see the money used in their lifetime. So they vote to keep assessments the same. Forever.

Then.......... something bad happens, like a roof. And a special assessment must be made because there is no money in the accounts to cover it.
Our condo community is fairly new....less than 10 years old. When they did the first reserve study about 3 years ago, they realized the $100 monthly fee was way too low. Several options were presented as to how the reserves would be properly funded. The residents voted for an equal increase every year for just the reserve funds. This would ensure we have plenty for down the road. Only about a $5 increase every year. Then there is the other part of the fee...the weekly and monthly expenses. Landscaping, clubhouse and pool maintenance, snow removal, etc. That is usually another $5 increase...so the monthly fee goes up about $10 total every year. Not a huge amount, but enough to pay the bills and have plenty in reserve.


So by previous vote, our reserve MUST be funded correctly. To not take in enough money would be in violation of the board/community vote. And it would be just plain stupid.


It isn't cheap living in a condo. You are going to pay for it, preferably in your monthly fees, and not in some absurd $30k assessment.
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Old 10-07-2016, 03:35 PM
 
2,539 posts, read 2,908,393 times
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30K sounds ridiculous and almost no one would be able to pay that. Yikes. What are these condos worth anyway?

I had a condo for about a decade that was built in the late 80s. I know I got an assessment one time that was about $800 or so. It was for roofing and new decks. The monthly association fee went up quite a bit over the years, from about $100 to $250 when I sold it. There were tennis courts, a pool, and a common area. I know my association was somewhat mismanaged as well and someone probably stole some of the funds by paying "contractors" who did not complete work that was supposed to be done. There were also a lot of issues with the pipes in the units. And of course, water damage.

I think researching before you buy is probably your best route especially on an aging property where things will have to be fixed here and there.
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Old 10-07-2016, 05:08 PM
 
Location: Fort Lauderdale, Florida
9,067 posts, read 8,215,349 times
Reputation: 19643
Quote:
Originally Posted by ohhwanderlust View Post
Oh, we don't have a condo yet. My husband just said that it's common to be regularly hit with huge special assessment fees in condos.

.
Your husband is completely wrong.
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Old 10-07-2016, 05:44 PM
 
11,294 posts, read 7,655,244 times
Reputation: 12143
Quote:
Originally Posted by Jbeechuk View Post
After 13 years in a house, I didn't want the hassle of yard work and the ugliness of the neighbors who refused to mow their lawns. The extra costs are worth it to keep out the rif-raf.
But you have to put up with the downsides. You are in an apartment, so you share walls and maybe a floor or ceiling with neighbors. You have less space, no fenced in yard for pets, pet rules if they are even allowed. Plus other rules that some just don't want to be controlled by, people telling you who can stay with you or for how long or who can live with you or how many. and the rif raf may still get in.
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Old 10-07-2016, 06:53 PM
 
Location: Alexandria, VA, USA
946 posts, read 532,917 times
Reputation: 2181
Our townhouse HOA raised the dues every year by 5%. Water was included in the HOA fee, so there was no incentive to be frugal, even though it was the largest item in the budget. Oh, and they never bothered with capital maintenance the entire time we were there except for some shabby patch jobs, so the mortar work on the brick sidewalks is still crumbled or missing. Landscaping consisted of cutting down trees and shrubs, and planting annuals and crape myrtles. The management company at the time advised residents to attend to their own problems (such as an outdoors rodent infestation). They allowed one resident to install vinyl windows, although we were in the historic district.. When we moved in, it was an attractive complex; when we left 20 some years later, it looked shabby and tired, and its home prices did not rise as much as for nearby developments and neighborhoods. They did obtain a new management company, but too little, too late!
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Old 10-07-2016, 09:58 PM
 
Location: Columbus, OH
915 posts, read 669,312 times
Reputation: 1347
Quote:
Originally Posted by LifeIsGood01 View Post
But you have to put up with the downsides. You are in an apartment, so you share walls and maybe a floor or ceiling with neighbors. You have less space, no fenced in yard for pets, pet rules if they are even allowed. Plus other rules that some just don't want to be controlled by, people telling you who can stay with you or for how long or who can live with you or how many. and the rif raf may still get in.
Lol. Let's see

Apartment? Nope. I'm an end unit with a 2 car garage. Plenty of green space. I wanted a smaller yard. It's just the right size. Sure, high-rise condos are apartment-like in a lot of ways and I'm not sure if I would want people living over me.

Sharing a wall? Nope. I have a neighbor on one side connected, yes. But he has his wall, I have mine, and there is a firewall in between. Honestly, I have never heard a single sound from his side. I can hear his garage door open, but barely.

We have 2 cats, and dogs are certainly permitted. Never heard of a condo that didn't allow pets. You own your place. Why wouldn't pets be allowed?

Never heard of rules of saying who can stay with you or for how long. Again, it's my place. Yes, there are rules, and most of them I agree with.

Doubtful rif raf will move in. Those type of people want to park their 1993 Cameron on the front lawn that hasn't beeen cut in weeks, fly the Confederate flag, and hang out in their above ground ghetto pool.

Yes, there are some downsides, and I have said at condos are not for everyone. But for me, the upsides are worth it.

Last edited by Jbeechuk; 10-07-2016 at 10:21 PM..
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Old 10-08-2016, 06:32 AM
 
Location: Silicon Valley
3,549 posts, read 1,595,307 times
Reputation: 6051
I added special assessment coverage onto my home insurance policy. It was really cheap, like $20 a year or something.
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