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!