After the Florida building collapse, condos struggle to fund big repairs

[Yo_Mama_Been_Loggin]

Condo owners are facing a financial reckoning in the wake of the building collapse in Surfside, Fla., that killed at least 86 people and left more than 40 unaccounted for.

Across the country, residents and board members are discovering that they haven’t set aside enough money to pay for major repairs, like aging roofs. This funding crunch is rattling developers and property owners, and could increase housing costs for millions of Americans, who often view condominiums as a low-stress, lower-cost alternative to single family homes.

There are about 160,000 condominium buildings in the U.S. Though industry officials can’t put a price tag on how much maintenance is needed nationwide, Robert Nordlund, the CEO of Association Reserves — which advises condominium and homeowners associations on setting aside money for repairs — said the figure is “staggering.”

Of Nordlund’s 30,000 clients, he estimates that 30 percent of properties are significantly behind in their reserve funding, meaning they hold 30 percent or less than the total funding they need for planned and unexpected future projects. Another 40 percent properties are only in “fair” condition, holding just 30 to 70 percent of needed funding.

https://www.msn.com/en-us/news/us/after-the-florida-building-collapse-condos-struggle-to-fund-big-repairs/ar-AAM1bVR

[DURHAM D]

1. Every shared interest community needs to contract for a Reserve Study

to determine what will be needed in the future. Board members and unit owners fight against getting this info because pretty much everyone wants to sell their property and move on while the buyer is none the wiser.

[SWBTATTReg]

2. A definite need for financing ongoing big ticket repairs on these major structures (or even

smaller structures). I thought that when one buys a condo, that bylaws are clearly written to include these types of payments but I am guessing that condo association members vote down more often than not, special assessments needed to repair roofs, other big ticket items.

I wonder if the original condo builders (and sellers of these properties initially) under emphasized the need for these repairs and how much these costs are when originally selling the properties? That is, in order to get people to initially buy into the condos, fees/costs were understated? I wouldn't be surprised if this happened far more than it should.

I had looked initially at looking into a condo type of home but balked when faced w/ high initial monthly condo fees (which could increase, without limits of some sort), as well as the occasional special one time assessments (for special over the top repairs) and then dealing w/ a whole slew of people (condo owners, condo board, etc.) and trying to get all members to agree on a particular thing/item, that needed to be done, a difficult thing.

Don't get me wrong, from what I have heard, a condo can be heavenly, and a wonderful way to own a slice of one's personal mecca, at an affordable price and at a minimal fuss, after all, when we are up in our golden years, we don't want to have to worry too much about building repairs, and other such mundane stuff when we're in our personal mecca. But, I do see the lawsuits all starting now on the Surfside collapse, I wonder if anyone will even see a dime?

[PortTack]

3. "Owning a slice of heaven" is never cheap! I get the no mowing or snow removal etc, but why

Do ppl think they won’t or shouldn’t have to pay for needed repairs? It’s not a rental, they knew that when they purchased the property

Too many ppl in this country live beyond their means...this is an example.

[SWBTATTReg]

4. I think you're absolutely right. The bills must be paid by someone (but not me!)...

Eventually this "head in the sand" mentality comes back to bite everybody.

[Politicub]

5. Fees and special assessments are part and parcel of condo living, especially in high rises.

It costs a lot to run and maintain a tall building as it ages. And the fees only go up year over year.

Condos can be great or bad -- depends on the board, number of resident owners, where it's located, etc.