First-Timer Primer: Is This Condo Building Financially Healthy?
In this edition of First-Timer Primer, we look into the question of how to determine if a condo building where you are considering buying is in good financial health.
Below we highlight four important things that will tell you if the financial situation is sound in a condo building.
1. Are there any delinquent accounts?
Specifically, are there any unit owners who are more than 60 days behind on their condo fees or are there any units in foreclosure. If so, this can prevent financing and be an indication of poor management and/or engagement with homeowners in trouble.
2. Does the building have a budget and are they sticking to it?
Well-run associations will have a written budget and a monthly report showing the budget to actual expenditures. Whether a building is staying on budget or not can give you a sense of how well they are managing expenses. For smaller associations, you may have to look at 12 months of spending records to see how many unexpected expenses came up and how the management handled them.
3. Is the master insurance policy up to date?
It’s easy to let it lapse if someone isn’t keeping an eye on things.
4. How much money is in the building’s reserve fund?
This will vary depending on the building. If it’s a large building, there should be a fairly recent reserve study report that will show how much should be in reserve. If it’s a smaller building, then have a home inspector look around and give you an idea if any major repairs are on the horizon. Major expenses in smaller buildings are usually the roof and elevators.
The information above can usually be provided to potential homebuyers by the condo association or management company.
Similar Posts:
- First Timer Primer: How Much Cash Do You Need to Buy a House?
- First-Timer Primer: The Mortgage Pre-Approval Process
- First-Timer Primer: How Do Mortgage Payments Work?
- First-Timer Primer: The Escalation Clause
- First-Timer Primer: A Condo Fee Tutorial
- First-Timer Primer: What is a Rent Back?
- First-Timer Primer: What is an Adjustable Rate Mortgage?
- First-Timer Primer: Taxes and Profit from Selling a Home
- First-Timer Primer: How A Retirement Account Can Help You Buy a Home
See other articles related to: condo board, condo building health, condo fees, first-time buyers, first-timer primer
This article originally published at https://dc.urbanturf.com/articles/blog/first-timer_primer_how_can_you_tell_if_a_condo_building_is_financially_heal/7426.
Most Popular... This Week • Last 30 Days • Ever
Back in 2022, the DC Zoning Commission gave the green light to a large mixed-use deve... read »
Opening for sales this spring, The Brownstones at Westbard Square will feature 101 ne... read »
Today, UrbanTurf is taking a look at the tax benefits associated with buying a home t... read »
Donohoe presented plans on Thursday evening for a new multi-family residential projec... read »
Even with two large apartment buildings delivering in Northern Virginia's National L... read »
- Raze Application Looks To Pave Way For 700-Unit Development in Brookland
- Coming Soon: New EYA Brownstones at Westbard Square in Bethesda
- A Look At The Tax Benefits of Buying a Home Through a Trust
- Early Plans Unveiled For 130-Unit Development in Friendship Heights
- 3 Down, 7 To Go: A Look At The Thousands of Units Coming to National Landing
DC Real Estate Guides
Short guides to navigating the DC-area real estate market
We've collected all our helpful guides for buying, selling and renting in and around Washington, DC in one place. Start browsing below!
First-Timer Primers
Intro guides for first-time home buyers
Unique Spaces
Awesome and unusual real estate from across the DC Metro