R.A. from Illinois writes:
Dear Mister Condo,
I backed out of a deal to buy a townhouse that had dry rotted wood along the outside trimming of the chimney and siding, and where gutter is to attach. There was even gaping holes in some areas where dry rot existed. The seller completed repairs for the inside but argued that the HOA was responsible for exterior repairs. How does a buyer avoid this kind of situation? if they want the townhouse but repairs don’t get done for the exterior by the HOA? A response is greatly appreciated.
Mister Condo replies:
R.A., I am sorry that this deal fell apart but I do think you were wise to walk away from this particular association where they have allowed exterior maintenance to get so out of control. It is a sign of a deeper problem with the association’s finances. If they don’t have the money for this particular repair, there is a very good chance that they haven’t been collecting enough common fees for many years in order to properly fund their Reserve Fund, which would be used to pay for such common repairs. Eventually, a Special Assessment or HOA loan will be needed, both of which will drive your monthly costs much higher than what they are now. The current owner could sue the association for breach of contract for not keeping the building in better shape but that costs money and isn’t always successful. Ideally, current owners in this building will demand the repairs be made and the assessments that go along with those repairs will be levied. It is Buyer Beware from your standpoint. You sensed the problem and your instincts to leave the deal were correct. Hopefully, this association will get their act together and make the repairs necessary. Meanwhile, you would do well to find another unit to purchase and make sure that the association is holding up its end of the bargain and keeping the building well maintained. All the best!
1 thought on “Lack of Condo Exterior Maintenance Gives Buyer Cold Feet ”
This reader was so wise to let the purchase go, and I can tell it still is hard, because it must have been a nice unit to still be wondering about it. I hope the sage response given to you helps you feel better. It never ceases to amaze me how many buyers are completely focused on the unit, and typically aren’t paying attention to signs of lack of maintenance and outright disrepair in the common areas, sometimes major. Also I suggest when you are looking at a unit on a lower floor, go to the top floor and look carefully through all the common areas ceilings, stairwells, walls, to see any leaks or brown spots, wall bulges, and then the entire common area of the basement for water marks, dead rodents, etc. Look at tags on the fire extinguishers, if they have a current service date, if they are past date it is a very telling sign of dangerously poor maintenance. Try catching a unit owner or two and ask them how they like it. Some will just say oh it is nice, but you might find someone who gives you a hint if it is not a good situation. This is why Fannie Mae has issued a long questionnaire to avoid getting stuck with loans for properties with structural and serious deferred maintenance, but take care of the lawn and decorating. When you engage a home inspector, ask if they look at any of the common areas for signs of trouble.