Compare Condo Assessments

Have you tried to compare condo assessments of a particular condo association

with another one?  

Due to various factors, it’s impossible to make an accurate comparison

 

There are many reasons why it’s difficult to compare condominiums:

How do you compare condominium assessments

  • Age of the condo buildings may differ
  • Mechanical systems may differ
  • Type of materials used in buildings (brick, siding, stucco, wood)
  • Decks/Balcony on unit? – Is the unit owner or the Association responsible for repairs? Made of wood?
  • Elevators onsite? –  If so, how many?
  • Parking garage onsite?
  • Amenities of each association may differ (and may include: pool, tennis courts, fitness center, laundry room, lobby, clubhouse, etc
  • Are there a lot of trees and/or landscaping in the common areas?
  • Landscaping? Who mows the lawn – the unit owner or the association?Condo building with a pool
  • Roads and/or parking lots – Are they private or public?
  • Utilities: Does the unit owner or the Association pay for water, electric, gas, cable, or wifi? It may vary greatly by association
  • Does the building have any construction defects? Is the builder still around?
  • Has the association deferred maintenance?
  • Maintenance agreements:  Does the condo association have regular maintenance agreements with its vendors?  This would usually cover the elevators, mechanical equipment, pool, plumbing, etc.   Not having these agreements or performing regular maintenance will usually result in higher repair costs and possibly costly emergency repairs.
  • Has the Association had a Reserve study done?   If so, are the Reserve funds properly funded?  Does the Condo association have to catch-up?

Condo and homeowners associations financial issues

  • Does the Association have annual audits?  (They usually cost $3,000 to $6,000 per year)
  • Has a Reserve Study been performed?  If so, is the association following its guidelines?
  • When was the roof last replaced?  If more than 15 years ago, the condo association may need to assess higher dues.  They may need to save money to be able to replace the roof when needed.  (This is assuming the reserve fund is low)
  • Have there been many plumbing leaks?  If so, has the problem been corrected?
  • Does the community have many delinquencies?  If so, cash flow may be poor and the dues may be high to compensate for those units that can’t pay
  • Has the community been involved in any lawsuits?  If so, legal fees the insurance premiums may be high
  • If it’s a relatively new condo association (within 5 years), the dues may not have increased since being set up by the developer.  Developers usually set the initial dues artificially low, in order to sell units.   If they were low to begin with and haven’t been increased much, the association may have a cash flow problem or underfunded reserves.
  • Does the Board of Directors like to be popular and refuse to raise dues, even when necessary?
  • Does the Association borrow from its reserve fund to pay for operating expenses (regular maintenance, landscaping, etc) in order to avoid increasing dues?
  • Is one condo association managed better than the other?   Are costs and contracts reviewed at least annually?

Based on the above and many other factors, it’s impossible to make a valid comparison of condo association dues.

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