A condo owner recently told me he had to sell after the HOA assessed a $10,000 dollar, 3-year fee per unit for repairs to concrete balconies on the building. HOA fees may go up with inflation, unexpected repairs, inadequate reserves, or poor HOA planning. That HOA Fee Disclosure you received prior to closing may say there are no pending fee increases or assessments, but what if they’re about to be announced? Ask the HOA how increases and assessments are determined, how often they occur, and the history of such actions. Ask how large is the reserve fund, what it covers and what it doesn’t, and get copies of HOA meeting minutes to see what’s being discussed. The HOA fee normally covers the building so be sure there is adequate catastrophe insurance, and learn what your financial obligations are. Finally, be sure to include these expenses in determining return-on-investment and cash flow if it will be used as a rental property.
Tony DeCamillis, Realtor - New Smyrna Beach, FL
(855) 492-3456 - www.nsbrep.com
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