| Condos can be a wonderful lifestyle choice. A | | | | time. Be smart. Through careful research and |
| wise, well researched condo purchase may be | | | | due diligence, you'll follow the yellow brick |
| a golden investment, but keep in mind some | | | | road to a successful purchase. |
| very important considerations. Take note | | | | |
| that the purchase of a condo is very | | | | HOW MUCH GOLD IS IN THE POT?: THE REPAIR FUND |
| different from the purchase of a single | | | | |
| family home. In the case of a condo | | | | Know what is in reserve. The general rule: If |
| purchase, those neighbors whom you hope will | | | | the complex is 1-10 years old, the repair |
| be the kind to help you out in a pinch will | | | | fund should cover 10% of the cost of |
| also be your co-investors. As in any business | | | | replaceable items. At 10-20 years old, the |
| relationship, stepping into one should be | | | | fund should offer 25-30% coverage. With a |
| done with savvy and careful research. | | | | complex 20 years or older, the fund should |
| | | | cover at least 50% of repair costs. |
| Here are some golden rules for a perfect | | | | |
| condo purchase: | | | | IS THE RENTER POPULATION OVER 10%? |
| | | | |
| READ THE BIBLE! | | | | If so, make sure there are clear rental |
| | | | policies. In some cases the condo management |
| The "condo bible," in this case. "What is the | | | | company will also manage the renters. If this |
| condo bible?" you ask. It is the minutes of | | | | is the case, find out more about their |
| the condo association; they'll be your | | | | screening process. Ask to see their rental |
| strongest guide to a smart purchase. Preview | | | | lease and have your lawyer look it over. Talk |
| these minutes and it will be well worth your | | | | to other tenants and get the low down. |
| time. Here you will find evidence as to any | | | | Again, there may be rental information and |
| possible management difficulties. Ongoing | | | | history in the association's minutes. If you |
| gripes and complaints may indicate management | | | | are digging for gold and don't want toPr end |
| problems and a lack of cohesive vision | | | | up with a lump of coal, heed the sages' |
| amongst the association. Other things may be | | | | advice; leave no stone unturned. |
| highlighted in the minutes, such as projects | | | | |
| that are underway or proposed. Find out the | | | | ELIMINATE THE ENEMY: HAS THE CONDO |
| delinquency rates of current owners. This | | | | ASSOCIATION HAD ANY LEGAL ISSUES? |
| could be an indication that the association | | | | |
| is underfunded. These are all details that a | | | | Contact a real estate lawyer and go over the |
| seller may not have mentioned but which are | | | | bylaws of the association. Are the |
| paramount in the consideration of your condo | | | | association's bylaws consistent with the laws |
| purchase. | | | | of the state you're purchasing in? Never |
| | | | underestimate discrepancies that might cost a |
| DOES THE ASSOCIATION'S INSURANCE COVER YOU, | | | | fortune if left unchallenged. |
| AND TO WHAT EXTENT? | | | | |
| | | | Look into these essential details and you |
| Get your hands on a copy of the certificate | | | | will be able to make a condo purchase with |
| of insurance, which is a summary of the | | | | ease and confidence. Remember, the |
| condo association's policy. The replacement | | | | foundation of a wise purchase is not only in |
| costs within the policy should match the | | | | the building itself, but in all those niggly |
| estimated costs of rebuilding. Also the | | | | legal details. Happy digging, and may you |
| certificate should contain a | | | | strike gold and find the dream condo you've |
| building-ordinance clause. This clause | | | | been looking for! |
| indicates that the insurance will cover the | | | | |
| cost of bringing the building up to code if | | | | For more information on Minneapolis lofts and |
| there is any rebuilding to be done. | | | | or condos in The Mill District, contact Andy |
| Understand exactly what the association | | | | Asbury of The Asbury Group. Andy's a |
| policy covers. Again, all this research will | | | | Minneapolis REALTOR® specializing in loft |
| clarify the future potential for a | | | | and condo transactions. |
| not-so-great, or great investment. Take the | | | | |