Signs of a dysfunctional condo association [DC]
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Anonymous
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Talk to the neighbors. When I was on the market - I was leaving notes with my cell phone on neighbors doors.
Some neighbors called me back and most of them were very honest which I appreciated. I learned a lot about the culture of associations from these calls and settled on the great building I am super happy about |
Anonymous
No -- it can affect the property value if it's more. For example - https://www.washingtonpost.com/news/where-we-live/wp/2015/10/21/too-many-rentals-in-neighborhood-can-cause-property-values-to-stagnate/ You really need to research these things before you buy - you sound woefully under-informed re: condo ownership. |
Anonymous
https://www.marketwatch.com/story/too-many-renters-are-a-bad-sign-in-a-condo-complex-2015-04-27 |
Anonymous
| Buildings with large numbers of renters tend to be less well maintained because absentee owners are less interested in funding improvements. If more than a certain proportionate rentals, units won't qualify for FHA loans and many traditional lenders will be reluctant, too. |
Anonymous
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Which makes the case that OP should read the bylaws. Rentals should be limited to 25% of the units at any one time. OP here:upto 25% percent of rentals - is it the rule for DC or something? No -- it can affect the property value if it's more. For example - https://www.washingtonpost.com/news/where-we-live/wp/2015/10/21/too-many-rentals-in-neighborhood-can-cause-property-values-to-stagnate/ You really need to research these things before you buy - you sound woefully under-informed re: condo ownership. https://www.marketwatch.com/story/too-many-renters-are-a-bad-sign-in-a-condo-complex-2015-04-27 OP here thanks, indeed I have just moved here for work |
Anonymous
| I would not buy a condo is an association with 4-5 units. Every unit owner matters in making decisions which means nothing is done on time if ever |
Anonymous
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BTW my condo we just stopped doing minutes. We did do one heavily edited one at annual meeting. But we kinda stopped. No one went to meeting anyhow.
Not much in it for board members. We have a good managing agent and CPA and lawyer. The building is well run. But minutes becoming a dying thing as you can’t put anything remotely of interest. |
Anonymous
OP here:upto 25% percent of rentals - is it the rule for DC or something? No -- it can affect the property value if it's more. For example - https://www.washingtonpost.com/news/where-we-live/wp/2015/10/21/too-many-rentals-in-neighborhood-can-cause-property-values-to-stagnate/ You really need to research these things before you buy - you sound woefully under-informed re: condo ownership. https://www.marketwatch.com/story/too-many-renters-are-a-bad-sign-in-a-condo-complex-2015-04-27 OP here thanks, indeed I have just moved here for work How does one even find amount of renters in some buildings? For instance my garden apt complex has no gates, no staff on site, no common areas or amenities. We email owners info and nearly everyone on direct bill pay. I have no clue who is who. For instance I happen to know my neighbor rents. But she has been there 10 years. Some folks may rent furnished. No moving truck. Some times it could be kids or relatives. Look we are not in the bed check business. Unless someone doing AIRBnB or stuff (which we have none) who knows. And how would bank even know? No one is tracking rentals. |
Anonymous
8 unit condo building here. It is very difficult to find outside managers for small buildings in DC. Just recently went through the process and got turned down by so many for being too small. If you can find one, the costs are often prohibitive and so self management with outsourcing a few key roles (e.g., taxes) is the only option for many. |
Anonymous
No -- it can affect the property value if it's more. For example - https://www.washingtonpost.com/news/where-we-live/wp/2015/10/21/too-many-rentals-in-neighborhood-can-cause-property-values-to-stagnate/ You really need to research these things before you buy - you sound woefully under-informed re: condo ownership. https://www.marketwatch.com/story/too-many-renters-are-a-bad-sign-in-a-condo-complex-2015-04-27 OP here thanks, indeed I have just moved here for work How does one even find amount of renters in some buildings? For instance my garden apt complex has no gates, no staff on site, no common areas or amenities. We email owners info and nearly everyone on direct bill pay. I have no clue who is who. For instance I happen to know my neighbor rents. But she has been there 10 years. Some folks may rent furnished. No moving truck. Some times it could be kids or relatives. Look we are not in the bed check business. Unless someone doing AIRBnB or stuff (which we have none) who knows. And how would bank even know? No one is tracking rentals. If you are in a condo building and there is an association (and there should be), there is likely a process for getting your condo approved for rental status that is tracked. If there isn't (which is why you should read the bylaws!!), I would NOT buy in that building. If there are no rules regarding rentals, you could be moving into an Airbnb nightmare situation, nevermind the property value issue. |
Anonymous
| I live in a TH condo with 5 units and we definitely know who owns and who rents. It might not seem like it to renters, but the owners definitely know who is who when it’s that small. |
Anonymous
| First OP, condos are no more “transitional” than single family homes without associations. Whether or not your living arrangements, when purchased is transitional is up to you. A four to six unit building is too small for outside management. The bylaws and meeting minutes would be important. Do the owners actually meet and how difficult isn’t to make a decision. Red flags would be maintenance and high board turnover(people constantly quitting) or too low turnover (same person stays on board forever and is horrible to deal with,hence everybody else quitting). But with that small number of units, it won’t matter as everybody’s input should be required. |
Anonymous
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BTW in last financial crisis is was owners not renters that was a lot of issue.
My building is non Fannie/Freddie eligible and lots of banks wanted 25% down in a rental. Primary owners it was only 5% down. Out value at peak 2006 price was $435k a unit. At bottom of market it was $290k a unit. To add to it landlords do cold hard calculations none bought at peak. At bottom 2011-2016 a handful of landlords bought cash. Since 2017 been primary owners once again paying peak prices. The last landlord who bought with a mortgage was 2003. |
Anonymous
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BTW my 30 unit building it is $950 a month a good managing agent.
We also have a CPA, lawyer (only pay when we use), snow and lawn service (same guy) quarterly sewer service, annual gutter cleaning and roof check and handiman on call. And we don’t do assessments but we save up new driveways, cement work, painting etc My building is lucky we let it run down on purpose 2007-2012 as we build reserves. We then over 4 years redid whole place from 2013-2018. No assessment. Luck as prices shot up in 2020-21 but we are good for a long time. We have two years worth of common charges in bank! Right now we are charging slightly above break even on condo fees. We can go 10-15 years now with no raise in fees. |
Anonymous
it is not necessarily a sign of bad management but then you can be hit with huge assessments when work needs to be done. i lived as a renter in a building years ago where in a couple of years all the AC pipes were changed (i.e. inside each apt the walls were opened to put the new pipes) and the outside mortar was repointed in the entire building. there was no special assessment because the condo had good reserves. see condo that fell in Florida where works were necessary but owners were assessed between $80,000 and $330,000, many could not afford it and this was one of the reasons the works were delayed. |