WHAT TO LOOK FOR IN YOUR LOFTY CONDO ASSOCIATION
Since lofts are nearly always set up as condos it’s important to understand what to look for in a healthy condo association. Here are 7 important questions to ask:
Are there any special assessments currently planned?
Special assessments are fees charged beyond the monthly assessments. Typically they are done for capital improvements to a property. You’ll want to know what projects are and more importantly if the seller plans to pay.
Are any projects anticipated over the next 5 years?
You’ll want to know if any projects are in the pipeline. While there may not be a current special assessment, there could be one looming. A great place to find out is to review the minutes from the condo board meetings over the past few years.
Has there been any projects completed in the past 5 years?
It’s always good to know that an association is taking care of the building. It’s also great when large projects like a roof or tuck pointing have been done. Don’t be put off by these projects. It’s part of routine maintenance and a sign of healthy decision making by the association.
What is the balance of the reserve or savings fund?
You’ll want to make sure the association has savings. These numbers vary wildly as small buildings often elect to keep assessments low. They may have as little as $1000-$2000 in savings. Larger buildings often have hundreds of thousands of dollars in reserves. Use your agents experience to guide you through what is considered acceptable for the size and condition of buildings that interest you.
What is the owner occupancy rate in the building?
While it used to be more important for financing the owner occupancy rate doesn’t mean as much anymore, especially if you are purchasing the unit to live in. It does however give you a feel for the composition of your neighbors. Most people that invest in a property prefer fellow owners as they are also vested in the property.
What is the pet policy?
This is often over looked if you don’t have pets but if it’s something you’re considering it’s a valid question. The far majority of loft buildings are pet friendly but some have weight limits or pet count limits that you should be aware of.
Are there any rental prohibitions in the building?
Make sure you understand your rights when it comes to being able to rent your unit. Many building have rental restrictions in some form or another. Just make sure you’re comfortable with the policy and that it fits your goals with the property.
Once under contract its appropriate to ask for the current budget along with condo declaration, rules and regulations, and by laws. These should be reviewed carefully and make sure to ask your agent or attorney should you have questions or concerns. It’s just one more prudent step that should be taken in purchasing your loft.