9 QUESTIONS TO ASK THE CONDO BOARD

When you buy a condo, you join an association of owners that determines everything from whether to plant perennials in the courtyard to how to finance a major tuck –pointing or roof project. Before you buy, contact the condo board with the following questions. In the process, you’ll learn how responsive – and – organized its members are.

1. What percentage of units are owner-occupied? What percentage are tenant-occupied? Generally, the higher the percentage of owner-occupied units, the more marketable the units will be at resale.
   
   
2. What covenants, bylaws, and restrictions govern the property? Is there a grandfather clause in place? You may find, for instance, that those who buy a property after a certain date can’t rent out their units, but buyers who bought earlier can. Ask for a copy of the bylaws to determine if you can live with them. And have an attorney review property documents, including the master deed, for you.
   
   
3. How much does the association keep in reserve? How is that money being invested?
   
   
4. Are association assessments keeping pace with the annual inflation rates? Smart boards raise assessments a certain percentage each year to build reserves to fund future repairs. To determine if the assessment is reasonable, compare the rate to others in the area.
   
   
5. What does and doesn’t the assessment cover – common area maintenance, recreational facilities, trash collection, snow removal, etc.?
   
   
6. What special assessments have been mandated in the past five years? How much was each owner responsible for? Some special assessments are unavoidable. But repeated, expensive assessments could be a red flag about the condition of the building or the board’s fiscal policy.
   
   
7. How much turnover occurs in the building?
   
   
8. Is the project in litigation? If the builders or homeowners are involved in a lawsuit, reserves can be depleted quickly.
   
   
9. Is the developer reputable? Find out what other projects the developer has built and visit one if you can. Ask residents about their perceptions of the developer.

A final note: Remember to play nice. When you buy into a condo building or hone owner’s association, you join a group with a variety of personalities and agendas. Negotiation and cooperation is key to living in harmony.

(Maryland law allows for Buyer’s to have a rescission period to review documents and bylaws for condominiums and Home Owner Associations)