Buying Or Selling A Condo | San Francisco Bay Area Local Real Estate

What You Need To Know When Buying Or Selling a Condo

DEALING WITH A HOMEOWNER'S ASSOCIATION CAN BE A CHALLENGE - LET US GUIDE YOU

How is Buying a Condo Different Than Buying a Single-Family Home?

For many people, living in a Condominium (or a Common Interest Development) is their happy place. However, we've all heard stories about nightmare Homeowner Associations (HOA's) or neighbors that are too close or too intrusive. It's true, even for single family homes, being a property owner can be stressful. But if you own a condo, you've chosen to become a part of a small democracy, where there's a governing set of rules (the CC&R's) and a group of fellow owners (the Board), a Budget, shared Expenses (most likely insurance, maintenance, amenities) and a shared Reserve Bank Account, to which you contribute when you pay your monthly dues.

Many times we've come across Buyers who haven't yet had any experience with a condominium purchase, so they don't know the basics. Here are a few important things to know:

When you own a condo unit, not only do you own your own space/unit, but you are also a part-owner of the common areas, such as shared amenities like outdoor spaces, gyms, pools, community rooms, etc.; you may also have 'deeded' or 'assigned' exclusive use areas such as patios, decks, parking spaces, or storage units;
Usually, within your unit, you own the 'paint-in' space between the walls, but the shared aspects of the building such as inside the walls, the roof, the siding, the foundation, etc. is HOA property and cannot be altered without HOA permission;
California Civil Code states that condominiums shall be managed by an Association (or "HOA"). All condo owners are members of that HOA; the HOA is governed according to their Covenants, Conditions & Restrictions, By-Laws, and motions/rules that are approved by the Board. As a Buyer, it is a state law that you shall have the right to review and approve these governing documents, plus any budget or reserve study, minutes of HOA meetings, proof of insurance, upcoming required assessments, if any, and other pertinent disclosure information.

That's a lot of information to review! And keep this in mind - not only do you as a Buyer need to know and approve this information, but so does your lender, who during the underwriting process, needs to approve certain HOA information. A good local Buyers Agent will know to review HOA details with your mortgage consultant prior to writing any offers.

What are some of the important things to look for when assessing a condominium or planned community property? An experienced REALTOR will be able to assist you with this question! Typically, some of the important information we are looking at will be the age of the community, the percentage of owner occupants, the funds in the reserve account, who is responsible for which maintenance items, the potential for upcoming assessments, etc.

There is a lot of information gathering and review that can be done upfront before you make an offer on a condo property. Our agents at Bay Area Local Real Estate can guide you through this process; and if you need a deeper dive into the budget and financials, we can refer you to one of our vendor partners, a local HOA financial assessment specialist.

Take a look at the icons below; each of them represent common questions and topics that may arise when buying or selling a condominium.