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Q:
How
do you choose between condos and single-family homes?
A:
Using
appreciation as a measure, condominiums in some areas
have been as profitable an investment as single-family
homes in the last five years. And in some markets,
condos appreciated even more, according to some experts.
While single-family homes have been the preferred
investment by home buyers, changing demographics are
helping make condos more popular, especially among
single home buyers, empty nesters and first-time buyers
in high-priced markets. Also, the condominium community
has worked hard in the last few years to overcome
image problems brought on by homeowners association
and developer disputes as well as all too frequent
construction-defect litigation.
Q:
Are condominiums risky to buy?
A:
While condos never had the kind of appreciation experienced
by single-family homes in the go-go 1980s, most ultimately
have not lost value, say some experts. And with high
prices in many urban markets and more single home
buyers in the market than ever before, the market
for condos is strong. As with any home purchase, you
should do your homework about the neighborhood or
development before you buy. In the case of condominiums,
it is important to read the past six months of homeowners
association minutes to see how effective the board
is and to learn about any possibly detracting issues
(such as protracted litigation with the developer).
The condominium community has worked hard in the last
few years to overcome image problems brought on by
disputes and lawsuits. Associations are becoming more
sophisticated about property management and taking
steps to prevent legal problems and disputes. Other
resources: * Community Associations Institute, 1630
Duke St., Alexandria, VA 22314; (703) 548-8600. *
"The Condominium Bluebook," Branden E. Bickel, B&B
Publications, San Francisco, CA; 1993.
Q:
Do condos have to be made accessible to the disabled?
A:
The 1990 Americans with Disabilities Act does not
require strictly residential apartments and single-family
homes to be made accessible. But all new construction
of public accommodations or commercial projects (such
as a government building or a shopping mall) must
be accessible. New multi-family construction also
falls into this category. In all states, the Federal
Fair Housing Act provides protection against discrimination
for people with physical or mental disabilities. Discrimination
includes the refusal to make reasonable modifications
to buildings that aren't accessible to the disabled.
Two educational brochures, "Housing Rights" and "Discrimination
is Against the Law," are available through the Department
of Fair Employment and Housing by calling (800) 884-1684.
Q:
Can
condos ban smoking?
A:
A
homeowners association's board of directors can restrict
smoking if it applies to indoor common spaces such
as hallways or recreation rooms. Outdoor spaces are
a different story, say legal experts. Any restriction
would probably hinge on local laws (i.e. if a city
banned smoking outdoors, a homeowners association
probably could restrict smoking in its outdoor spaces).
Typical covenants, codes and restrictions (CC&Rs),
which govern condo associations, give the board authority
to make and enforce reasonable rules for the use of
common property. But that would not apply to interior
spaces owned by smokers themselves. Resources: * Common-interest
development brochure available free from California
Department of Real Estate, Book Orders, P.O. Box 187006,
Sacramento, CA 95818-7006; (916) 227-0938. * Various
Internet sites specializing in common-interest developments,
such as those operated by the Community Associations
Institute and CIDNetworks.
Q:
Can
a condo association ban nudity?
A:
Could
you sunbathe in the nude on your own balcony? Not
necessarily. In a condominium development, a balcony
is not considered private property but common property
assigned to your exclusive use but a common area nontheless.
Covenants, codes and restrictions (CC&Rs) usually
spell out what activities can and cannot be conducted
on common property. Some associations prevent people
from barbecuing on their balconies or hanging large
plants from the railings. However, the larger issue
of regulating personal conduct is not so clear-cut.
It literally depends on what side of the fence you're
on. If the sunbather can be seen from a public vantage
point -- not by someone who must climb a tree or peer
through binoculars -- then the rule probably would
be considered reasonable, say legal experts. Incidentally,
there are places where nudity is tolerated but again,
only out of public view.
Q:
Are condos a good investment?
A:
Condominiums
have held their value as an investment despite economic
downturns and problems with some associations. In
fact, condos have appreciated more in the last few
years than when they first came on the scene in the
late 1970s and early 1980s, experts say. While there
are lots of reports about homeowners association disputes
and construction-defect problems, the industry has
worked hard to turn its image around. Elected volunteers
who serve on association boards are better trained
at handling complex budget and legal issues, for example,
while many boards go to great lengths to avoid the
kind of protracted and expensive litigation that has
hurt resale value in the past. Meanwhile, changing
demographics are making condominiums more attractive
investments for single home buyers, empty nesters
and first-time buyers in expensive markets.
Q:
Where
do I get information on condo association laws?
A:
Resources:
* "The Condominium Bluebook" by Branden E. Bickel,
B&B Publications, San Francisco, CA; 1994; call (415)
433-1233). * Community Associations Institute, Alexandria,
VA; (703) 548-8600.
Q:
Where
do I get information on condos?
A:
The
major interest group for condominium projects and
other so-called common-intereset developments is the
nonprofit Community Associations Institute,1630 Duke
St., Alexandria, VA 22314; (703) 548-8600. Also, check
the Internet where CAI operates an informative site
as does CIDNetworks.
Q:
Are
one-bedroom condominiums a good investment?
A:
One-bedroom
condominiums historically have not been considered
as good an investment as condos with two bedrooms
or more. But in high-cost markets, such as Manhattan
or the San Francisco Bay Area, one-bedroom condos
have proven to be equally good investments. Helping
that along are changing demographic trends. With more
single home buyers in the market today than at any
time in history, there is more demand for one-bedroom
condos.
Q:
How
do I figure out the homeowners association?
A:
Learn
everything you can about the homeowners association
before you buy into a development governed by one.
The association's financial, political and legal conditions
are very important to your investment and quality
of life. When run properly, homeowners associations
maintain the common grounds and keep civility in the
complex. If you follow the rules, the association
should not intrude on your privacy or cost you too
much in association dues. Poorly managed associations
can drag down property values and make living there
difficult for residents. Start by studying the association?s
covenants, codes and restrictions, or CC&Rs, and find
out if you can live by them. For example, if the rules
prohibit loud music after a certain hour and you like
to play your CDs late at night, this may not be the
place for you. Don't move in thinking you can get
away with violating the rules or change them later
because you may find yourself in turmoil with determined
neighbors firmly in control of the association board.
Find out all you can about the association's finances.
Beyond reviewing the budget, talk to the association
treasurer and find out if dues are expected to increase
and if any special assessments are planned. Ask if
special inspections have revealed problems with roofs
or plumbing that may cause a dues hike or special
assessment later on. Call and meet with the association
president. If you are the type of person who despises
intrusions into your private life and the president
seems more interested in gossip about the residents
than maintaining the property, this may not be the
right condo complex for you. Speak with residents
to get their views on the association's finances,
its property manager, how it operates and any politics.
Associations are volunteer organizations with elected
boards, like a mini-government, so politics can enter
the picture and spoil a good thing. Lastly, take some
time to understand how homeowners associations are
organized and how they conduct business. Like all
real estate investments, the more you know the better
off you are.
Copyright
1999 Inman News Features
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