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Condo Association Pros/Cons

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swood67

Junior Member
What is the name of your state? WI

I currently live in what is referred to as a "villa". It is a zero lot line home which means we own the exterior of our unit as well as the lot. We pay a monthly "maintenance" fee that allows us to use the clubhouse, provides lawn care, and also provides snow removal. We do not have an association right now.

Last night, the developer called a meeting and presented a proposal to us. He wants to change the convenants so that all new units would be condo's not villas. He wants us to form 2 associations, one for the villa owners and one for the condo owners. He stated that he would lease the clubhouse back to us for less than fair market value. He also stated that we would not have to pay more than the current fee although he did not have a legal document ready for us to review. Most of his comments stared with "Our intentions are...."

My questions are: "Why is he doing this?" Obviously, he gains something by switching to condo's vs a zero lot line units. Correct? Will we lose something? Will our home value be depreciated? What do we gain/lose by forming an association? Can we force him to have legal binding documents available for us before "voting" on the issue? What are our rights as owners?

I don't want to sound like a pessimist but the developer is a business man and is out to make money like any business person would. I find it hard to believe that he is going to do things for us out of the "goodness of his heart". Any thoughts, suggestions, comments, etc. would be greatly appreciated as none of use are real estate attorneys.

Thank You!
Stephanie
 


jwa416

Junior Member
Hi Stephanie,
I am a condo/townhouse owner in CA and not an attorney. From my experience with my own HOA and all the issues that have come up in 8 yrs. of home ownership, I suggest you consult with a real estate attorney in your area. Each state has its own R.E. laws.
I personally do not see any advantage for you to join a Condo Association. Do you have C C and Rs yet? These are recorded covenants, conditions and rules that Condo Associations have and all owners are subject to following. They may include eveything from landscaping, parking rules, pool and common area use to controls over number of pets allowed at each home, window coverings, use of garages,etc.
It sounds like as a Villa owner you have more control over your property and your exterior. If you are forced to join an Association and have to share a club house with Condo owners, something does not sound right. As a Condo/townhouse owner I do not have control over my exterior. Our HOA Board along with a Property manager hires all contractors like painters, roofers,pet control companies etc. The board works on preparing an annual budget and takes our monthly fees and uses the funds to pay for all maintenance, fire and earthquake insurance,etc. They can make decisions on tree removal, paint colors, exterior light fixtures,etc. We have a reserve account for major work, but also can have special assessments if there is not enough funds to cover a major repair.
We do have annual meetings to elect the Board and to discuss major issues. Owners can attend the monthly Board meetings to voice opinions.
In general, a Condo association is very complex. Before moving in that direction, I would find out more about what your Developer is legally authorized to do if he does not own your land or your home.
Keep us posted.
JWA in CA
 

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