Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
I purchased my first home, a condo, last year after looking at about 25 homes. The HOA fee was on the lower end of what I saw. When purchasing I did receive a copy of the budget and reserves information per the law, but I had no idea what to look for or what was enough money. My realtor said everything looked fine and I trusted him. My ignorance is costing me.
One of the reasons I went with the condo over a single family home was because the roof, siding, and exterior maintenance were supposed to be covered by the HOA. However, I just found out our association is planning a $1.5 million siding project and we are way under funded. Each homeowner will have to kick in around $12,000 to complete this. For those who don't have $12,000 to pay it off in one lump sum (I definitely do not) you can go on a monthly payment plan of $137 additional per month for 7 years.
It is very clear the board and our management company are either extremely incompetent, or something shady is going on.
First of all, they refuse to demonstrate the siding actually needs to be done. It has not been done in 35 years, but I read online that aluminum siding can last over 40 years. They have said people are having problems with water coming into their homes and heating and cooling. When pressed, they can only site 2 or 3 units out of 108 that have had problems. Also residents who report heating and cooling also have windows from the 90s. Well of course you are having energy problems! I have great heating/cooling with my new windows.
Their other argument is because it "looks like crap" and it will "significantly raise property value" but in my opinion they don't look that bad. Sure, the buildings are starting to look their age and could definitely use a good power washing and some sprucing up. However, I don't feel like spending $12,000 because something doesn't look super nice. For me there would have to be major functional problems and they haven't shown that.
At the first meeting a few residents demanded an engineering study be done. The board claims to have done that and they said the engineer says the siding is in bad condition and replacing it is "high priority." I have been asking for a copy for a few days now and they keep giving me the run around. I have a family member that is a construction engineer who agreed to look at the report but so far I've had no luck getting it. One of the board members is my neighbor and I've asked him directly and he said the engineer made a mistake with some of the numbers and they needed to "clarify" some things before they could give it to me. That was 3 days ago. They couldn't say when it would be ready for viewing.
The board has admitted to keeping assessments too low (they weren't even the lowest I saw) and that is why we are so underfunded. We are in major financial distress and there will probably be an additional special assessment in a few years to pay for a new roof. They will also be raising the regular assessment though the new amount hasn't been decided yet. They have never done a reserve study in the 35 years the HOA has existed. The first one they did was this year.
The same people have been on the board for a while. How could they not see this coming?? And even if they didn't, we pay a professional property management company to advise us. How could this company not see the financial problems and recommend changes a lot earlier to avoid this? Why didn't they plan for the siding years ago and start putting away in a special account for it? It's not like they couldn't have known the siding would need to be replaced at some point.
The board cannot or will not give me facts and figures about how bad the siding actually is or show me a report from an independent engineer who says it is bad and needs to be done ASAP. It's just a lot of talk about it being old and "looking like crap" and them just stating the engineer says it is bad.
They also have a budget that seems wacky. They gave me a copy and it says "common area maintenance" and that it costs $25,000 per year. We have separate line items for landscaping and concrete/sidewalks and clearly it wasn't going toward siding so I have no idea what that could be. When I asked my neighbor the board member he was very vague like he didn't quite know himself. We are also paying $10,500 per year to have some guys throw down salt when it is icy because a board member's wife slipped and fell one year. And $10,000 per year to have our dryer vents cleaned out. Seems out of control to me.
I am thinking about selling before they make the project official and I have to disclose it. I would take a loss on my home because I also did some renovations (I was planning on being here for several years) but I think I may lose more money chucking it out to special assessments for maintenance that should be covered by the HOA.
Is there anything I can do legally to put a stop to this siding project? Can we as residents hold the board and/or property management company accountable for not properly managing funds? What can I do? I cannot afford this and don't want to have to sell my home and lose a ton of money. Any advice would be helpful.
Is there anything I can do legally to put a stop to this siding project? Can we as residents hold the board and/or property management company accountable for not properly managing funds? What can I do? I cannot afford this and don't want to have to sell my home and lose a ton of money. Any advice would be helpful.
Let's assume you stop the siding project. In 5 years, the siding is now at life expectancy and it needs replaced. $12k today, or $137/mo for 7 years now or in 5 years? The crystal ball shows new siding in your near future. Your HOA could fix itself and raise fees to heal the reserve fund in time for the next capital maintenance or replacement, but won't you still be paying more than yesterday? Pay now and get siding or pay now (raised dues to fund reserve) and get siding later?
It stinks, and your HOA BOD stinks, but "legally" proceeding against your BOD will generate a legal defense by your BOD and that costs money that will not be buying a roof or siding.
Not knowing what state you are in I can only give a very general answer.
You need to get a certain percentage of like minded owners and request a special meeting. Ask to see the bids for the siding job. Ask to see a reserve study if there is one and find out if your state requires one. Ask if there is an audit performed regularly. Ask about vendor contracts and how often they are rebid. If they screwed up this bad you will also want to know about insurance coverage since it is expensive and some boards tend to neglect it.
Probably time for a recall of some if not all board members. You will most likely have to pay the $137 a month but you have to start now to correct things so it doesn't happen again in the future.
Let's assume you stop the siding project. In 5 years, the siding is now at life expectancy and it needs replaced. $12k today, or $137/mo for 7 years now or in 5 years? The crystal ball shows new siding in your near future. Your HOA could fix itself and raise fees to heal the reserve fund in time for the next capital maintenance or replacement, but won't you still be paying more than yesterday? Pay now and get siding or pay now (raised dues to fund reserve) and get siding later?
It stinks, and your HOA BOD stinks, but "legally" proceeding against your BOD will generate a legal defense by your BOD and that costs money that will not be buying a roof or siding.
That's true, but I am hoping in 5 or so years when it actually needs to be done I will be in a better financial position OR I will have a few years to spend here before selling my condo and buying a SFH.
I had a bad accident last year and broke my leg in 3 places. I am still paying off several thousand dollars in medical bills. I may also need another surgery on my leg.
Now is not a good time for me. I'd rather pay in 5 years. I can handle a small increase in the assessment to help build reserve funds, but I can't handle an extra $137/month of money I shouldn't be paying in the first place.
The second option is less, not even taking into account that it will be less with 7 years of interest.
The numbers aren't fully nailed down. It will be about $12,000 up front or about $137 + interest. It may come out to like $11,500 instead of $12,000. I think they just rounded up.
The numbers aren't fully nailed down. It will be about $12,000 up front or about $137 + interest. It may come out to like $11,500 instead of $12,000. I think they just rounded up.
Regardless it is a lot, don't you think?
Nevermind, my boyfriend just corrected me. We'd be paying around $137/month for 10 years, not 7 years (this includes interest) or a number of around $12,000 upfront depending on what the final number is.
FYI, my daughter just needed a new roof on her ranch house.
$17,000
She needed new decking
$7,000
This is on a house less than 20 years old.
Point is, if you are going to own almost ANY house (possibly exception of brand new with super nice builder), you are in for big expenses. No difference with a condo.
We own a condo (small 12 units only) and it is also well underfunded. I am on the board. The unit owners want it this way. They prefer special assessments.
Note - with a new high end unit, so far we have had to:
1. Replace the feed water line down the private road - builder never upgraded it - $110,000
2. Vast amounts of other systems that the builder cut corners on - maybe 30K
3. Builder did not properly prime the rear of the wood trim - we are spending about 20K per year for 4-5 years for trim replacement and painting.
Oh, I had to replace my hot water heater (many others did also) and just had to do major service on the HVAC unit.
Luckily, we got the builder to take some responsibility for the water line...but that may not have happened in many situations.
Point is - I don't suggest political solutions to this (getting residents together, complaining, etc.). It's six of one and 1/2 dozen of another. Pay me now or pay me later. The whole idea of a condo is that you don't get what YOU want at your timing......
We have cedar shakes on the siding - I suspect it will cost well over 12K per unit when we have to replace them, and it doesn't look like they will last 30 years.
Houses are expensive. They are not investments. If it would be cheaper to rent you may want to explore that option. One advantage to fee simple (small ranch house, etc.) is that you can do more DIY repairs and string things along further...as you don't have to kowtow to the condo mission...which is often to keep the property values high.
I think $12,000 per unit on a condo for siding is very high
We all think that. The board only got 3 quotes, all recommended by the management company. And the board let the siding companies dictate what needed to be done and what was quoted.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
