Condo conversions are very popular in Massachusetts. They can be a great alternative for those who prefer condo living but want to avoid large apartment-like complexes. However, it is important to perform a little extra due diligence when it comes to these properties. Here are several questions to ask before buying a condo conversion in Massachusetts.
1 – What repairs were completed before conversion?
Before a property was converted to condos, the owner may have completed some renovations. It is helpful to know what was included, if anything, in those renovations. Multi-family properties are not built with the same considerations as condos. Of particular interest should be anything that may provide better sound proofing and privacy for individual condo owners. Also, older buildings may have little insulation and aged electric, plumbing, and heating systems. Knowing what was upgraded may help you determine what future repairs you may need to perform to modernize your unit.
2 – What is included in the warranty?
New construction in Massachusetts generally has a one-year warranty. When it comes to condo conversions, the presence of a warranty will depend on the type of pre-sale renovation or construction. For instance, a 3-family converted to condos may not offer any warranty but an industrial building converted to condo units may offer one. If a warranty is offered, be sure to ask what is specifically covered. Understanding the warranty terms will help you determine its value.
3 – What are the rules and regulations?
All condos have some type of rules. Larger complexes tend to be stricter than multi-family condo conversions in Massachusetts. Rules are intended to protect individual owners, ensure private enjoyment of their units, and preserve property values. Thus, sometimes the lack of rules can be a negative because it fails to set expectations. Always review condo rules and look for measures that will help your rights as an owner and your intended use of the condo unit.
4 – What does the condo fee cover?
Condo fees typically help cover property insurance, maintenance, repairs and management. Get an understanding of exactly what condo fees cover and what you will be responsible for as a unit owner. For instance, does the condo fee cover landscaping and snow removal, or must you take care of those on your own? Reviewing this information in detail will help you better budget your homeownership expenses.
5 – How do the reserves compare to expected capital expenditures?
A portion of condo fees is normally placed into a reserve each month. The reserve is used for large future expenses such as roof repairs or driveway paving. When reserve funds are insufficient, unit owners must pay an assessment to cover the shortage. This can create a financial hardship. Thus, it is important to review what is in the reserves, how much that reserve will grow over time, and what it will be used for in the future. For your protection, the question you must consider is whether it will be enough to cover future capital expenditures.
Other Questions to Ask Before Buying Condo Conversions in Massachusetts
Whether you are buying a condo conversion or within an existing condo building, it is important to review all information available on the condo complex. Most of this is included in the condo documents or condo packet. It can include a lot of legal jargon and you may be unsure of what to look for or what should be a red flag. This is where your attorney comes in. In addition to reviewing the P&S, your buyer’s attorney should also review the condo docs on your behalf. He/she will also be able to answer any questions that you may have regarding the documents and your purchase of a condo conversion.