The Real McCoy: To buy a condo or not, that is the question

By: Kari McCoy, Special to Gold Country News Service
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Dear Kari,

I purchased my condo five months ago and I am really enjoying my new home. My problem is I just received a bill in the mail for $3,000 dollars from my home owners association stating it is a mandatory assessment. I thought that is why I pay dues each month and they were to figure this stuff out. Do I really have to pay this bill?


The condominium lifestyle may seem foot loose and fancy free, yet it is still an ownership which comes with responsibility.

Typically a condominium is a home within a community where you own your own home, which are the walls, floors and windows. In addition, your fence and balconies are yours to enjoy and maintain but they belong to the community.

The condominium association typically owns everything outside such as the roof, the common lands beyond your fence, decks in front of the house, swimming pools, tennis courts, parks, roofs, driveways, the club house and so on.

Along with the perks come the costs of maintenance, repair and or replacement. For instance you may not have to personally cut the lawn or tar the roof, yet you along with all the other owners will have to pay for your portion of the costs at the end of the day.

The condominium dues are collected by the management organization for the condominium. They are typically based on the square footage you have in your unit. This money may pay for water, common grounds maintenance and repairs, deck and steps maintenance, lighting, management company plus reserve funds. T

he reserve account held by the association is used for emergencies. An association can anticipate how much their fixed expenses will cost but have no control over emergencies such as storm damage, liability lawsuits, or accidents that could damage a unit and cost money to repair. In the event of an emergency, there could be cause for a special assessment on all the units, this may occur if the reserve account is insufficient.

When a condominium development has experienced short sales and or foreclosures situations occur in which the owners are not paying their mortgages nor are they paying their home owner dues. This lack of payment of dues can potentially cause unnecessary assessments on all the home owners in the development resulting in raising of monthly homeowner’s association dues or a special assessment fees.

In the event an emergency occurs community meetings are held and study groups are established. Experts are called in and the needs are evaluated and the costs are estimated. Then all the condominium members are invited to give their input and decisions are made regarding how to finance the solution to the problem.

Special assessments are extra fees beyond the regular monthly condominium fees. They are used to pay for unanticipated specific problems. There are several choices of how the condominium association may decide to have the owners pay for the unforeseen problem, such as a one lump sum or adding it to the regular association fee spread out over several months. Keep in mind that with the cost of a special assessment there is the benefit of keeping up their value of their investment and home.

The decisions for the condominium association including the special assessments are typically made by the elected board member or the majority vote of homeowners, and sometimes perhaps both. Keep in mind, the benefit is you are sharing the cost and someone else is organizing the estimates, overseeing the repairs and budget, while you have more free time.

Before buying a condo you would be wise to read all the following: Bylaws; covenants, condition and restrictions, rules and regulation; reserve study, minutes and agenda, resale certificate, recent newsletters if applicable.

Spend time at the project and talk with some of the owners that already live there. Most important of all is to see the latest budget that shows the real numbers. Your local Realtor will help supply you with all the documents and may also offer additional experts to talk with.

Kari McCoy owns the Kari McCoy Group, residential real estate at Lyon Real Estate. She can be reached at (916) 941-9540 or e-mail at