There are many more potential pitfalls than buying a single family detached home.

Unlike purchasing a single family detached home where you are the master of your own domain (pardon my Seinfeldism), the purchase of a condo or town house is a bit more involved. Basically, you and the other building owners are tied to each other because you may own realty or personal property in common. These are referred to as common elements. Who pays for maintenance? How much? Who decides what type of maintenance needs to occur? Should we repair or replace the deficient common element? Are we self-managed or is there a management company?

Homeowners Association Fees. In the condo/town house buying process, you should be made aware of the amount of homeowner’s association fees and the frequency of their payment. Know what is covered and what is not covered. Typically, if a development has a pool, elevator or gate house, the amount is significantly higher-than-typical for the market. How many owners are behind on their association dues?

Increase in fees? Are there any anticipated or pending increases in the periodic association fee?

Look at the association’s documents. Ask to see a copy of the association’s covenants, conditions and restrictions. These are the rules which govern that specific development.

Special Assessments? Are there any special assessments pending and/or anticipated? If so, who’s going to pay it?

Lawsuits. Are there any pending lawsuits against the association?

Budget. Review it or hire someone who will. Is there enough funding for replacement of the big ticket items i.e., roofs?

Financing. Some lenders do not lend in developments where the ratio of tenants to owners is too high.

Right of first refusal. Does the association have the right of first refusal on any sales in the development?

Insurance. Does the association carry liability insurance? What other types of insurance do they have?

Get a good real estate lawyer. Know the difference between a  good real estate lawyer and a lawyer who does real estate closings.

Questions? E-mail your question to me.

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