Condominiums are one of the best real estate investments to put one’s money in today. They’re more affordable, they’re easier to maintain, and they come with a variety of amenities. So if the options are between buying a condominium for living in or for investing in, make sure to keep these important condo-buying questions in mind.
- What are the condo rules and regulations?
Condominiums are governed by a condo association that has its own set of rules and regulations. The association is also in charge of collecting monthly fees and maintaining the upkeep of both the building and the community. Upon buying a condo unit, one automatically becomes a member of the condo’s association.
When shopping for potential condos to buy, ask to see its covenants, conditions, and restrictions (CC&Rs). This set of rules puts down in detail the condo association’s pet policy, rental restrictions, and renovation rules.
- How much are the association fees?
Part of owning a condo is paying its monthly association fees. These fees cover various aspects such as trash pickups, landscaping, water and sewer services, and pool maintenance. Get a breakdown of the condo fees and see if amenities being paid for are actually being used. A condo owner might be paying for the maintenance of the building’s gym or pool without ever planning to use it. Don’t forget to ask about the fee increases and how often it happens, as well.
- Is there enough money in the reserve fund?
Upon payment of monthly assessment fees, a portion of that amount goes into the reserve fund. This fund is used for paying off any long-term and emergency expenses. The standard amount that is set aside for reserve funds is usually 15% to 40% of the assessment fee. The client’s agent or broker can secure a copy of the condo’s financial statement.
It’s wise to know about the reserve fund because this indicates if the condo association has enough funds for special expenses. If not, condo owners will be required to pay an additional amount on top of their assessment fee.
- What is the condo association’s insurance policy?
Condo insurance policies usually have a master insurance policy that covers shared risks like property damage. Upon getting a copy of the condo association’s insurance policy, the condo owner can determine whether it’s worth it to use one’s own insurance policy or not.
- Does the condo have parking?
Parking space is an important feature that many look for in a condo. Some condos have deeded parking spots (which are attached to each unit) while others have designated parking spaces (which are assigned by the association or developer).
- Does the condo have any pending lawsuits?
Condo associations with litigation issues are a huge red flag. The high risk of a pending lawsuit could affect mortgage application and scare away lenders. If a potential condo has a pending lawsuit, talk to a trusted attorney so that it will be easier to decide whether to buy or to walk away.
Those looking for condos will have plenty to choose from in Santa Rosa. Get in touch with Brad Wilkinson at (707) 799-0455 or Brad(dotted)Wilkinson(at)cbnorcal(dotted)com to learn more about the condos for sale in Santa Rosa, CA.