January 24, 2020

Avoiding Condominium Purchase Nightmares

by William D. Fergus, Jr., Northwest Title Family of Companies, Inc.

Dick and Jane entered into a contract in January 2019 to purchase an existing condominium unit in an upscale Columbus suburb. Oblivious to the unique perils of condominium ownership, they closed on their purchase in February without first obtaining and reviewing information and documents regarding the condominium and its owners’ association.

Trouble came quickly. In March, the owners’ association notified the couple that they would have to find a new home for Ruckus, their six-year-old Labrador Retriever. Apparently, the association had adopted a rule limiting the size of pets to 30 pounds or less. In April, more bad news arrived: The roofs of several buildings in the complex had deteriorated more quickly than anticipated. Because the association hadn’t budgeted for the repair, each unit would be assessed $8,000 to fund repairs. Then in July, they began experiencing serious problems with their drains. They called a plumber, who informed them that repairs would cost approximately $11,000. He said the good news was that the problem was in a feeder line located outside the unit walls, and was therefore a unit owner association responsibility. Unfortunately, the association refused to take responsibility, taking the position that repairing the feeder line was the unit owners’ responsibility.

A nightmare scenario indeed (and clearly no fun for Dick and Jane), though I’ve had clients who encountered each of these issues at some point in my career. Fortunately, this is a nightmare that can be avoided by obtaining available documents and information, and having the results reviewed by an attorney familiar with residential real property law. In this scenario, a review of the condominium rules and regulations, available to the seller through the unit owner’s association, would have put Dick and Jane on notice that purchasing the unit may cost them their beloved family pet. Likewise, a review of the association’s financial records, and minutes of the meetings of its board of directors and unit owners (also available to the seller), would have put them on notice regarding any planned special assessments, and would also have given them a good understanding of the association’s long-term financial health. Finally, a review of the Declaration of Condominium and condominium drawings, typically available online through the County recorder’s office, would have provided Dick and Jane with the division of maintenance responsibilities between unit owners and the association.

An attorney well versed in Ohio real estate law will want to review additional documents and information. A more complete list of relevant documents and information is available to Realtors® through the Columbus Realtors® website, and to attorneys through the Columbus Bar Association’s website.


Fergus
Fortunately, this is a nightmare that can be avoided by obtaining available documents and information, and having the results reviewed by an attorney familiar with residential real property law.