Home Buying in Chicago>Question Details

Ohuico1, Home Buyer in Chicago, IL

Are assessment fees negotiable?

Asked by Ohuico1, Chicago, IL Wed Feb 16, 2011

For example: If assessments are $400 can you negotiate the price down to $300? Do all condos in a Condo Complex pay the same assessment fee.

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Answers

20
The HOA board would have to convene and vote to reduce the assesment fee. John is right request a HOA questionnaire before you present the offer

Best of Luck to you!
0 votes Thank Flag Link Mon Feb 28, 2011
Assessment fees are monthly payments made to the condo association by owners of condos in the building for expenses incurred by the building/association for maintenance of its common areas, running of the building’s amenities, payment of any employees, scavenger service/trash, and common insurance. The fees are usually assessed according to percent of ownership of the building. When you are negotiating the purchase of a property/condo in a building, you are negotiating with the owner of the condo. The entity who controls assessments is the association and the owner of the condo does not have the ability to control or negotiate assessments.
In a nutshell, no.
Web Reference: http://www.dreamtown.com
0 votes Thank Flag Link Mon Feb 21, 2011
Request a 22.1 HOA questionaire before you write the offer contract. The lender will want one anyway and HOA will charge you for filling in the blanks on HOA solvency, vacancy, owner occupancy rates, delinquency rates, reserve accounting. Normally your lender or attorney orders one from HOA after you get a deal together before you close. I suggest paying for one before you write offer if the HOA is at all sketchy with pending foreclosure units for sale.
0 votes Thank Flag Link Thu Feb 17, 2011
No they are not, however get a copy of the budgets to find out how strong the HOA reserves are and if they are possibly collecting too much. Voting by the entire HOA would have to take place for any reduction (or increase). Some HOA dues may include Heat, cable, or electric. Find out exactly what the fees cover. Also, if looking at a condo with more amenities, you will have higher assessments due to the maintenance of the amenities. Price is negotiable, asking the seller to pay your closing costs is another thing you can negotiate and if buying in Chicago make sure to find out if you qualify for any programs that are offered. Please feel free to contact me if you have any additional questions. Office 312-462-7715
0 votes Thank Flag Link Wed Feb 16, 2011
Assessments are pretty much 'cast in stone' based on percentage of ownership as outlined in the condominium declarations. They can vary on a year by year basis as the association's budget is formulated and the reserves are depleted or boosted.

If you don't pay your assessments Illinois law allows the association to take possession of the unit (complete with sherriff's eviction) and rent it out for up to a year or so. That allows the association to recoup the arrearage. Then they have to give possession back to the owner.

Assessments are essential to the ongoing maintenance and repairs of the building/s and should not be looked at as burdensome. They are needed to keep the building/s desirable to future buyers and to protect the interests of all unit owners.
0 votes Thank Flag Link Wed Feb 16, 2011
HI,
OHUICO1,
assessment fees, are not negotiable if anything they can also go up,
0 votes Thank Flag Link Wed Feb 16, 2011
No they are not, but you can negotiate the seller to pay part of the fee for the first year.
0 votes Thank Flag Link Wed Feb 16, 2011
No they are not, after the membership has voted on the amount. Often they are different depending on
the size of your unit.
0 votes Thank Flag Link Wed Feb 16, 2011
No, but ask management how they calculated the assessment. In a Coop scenario it is calculated by shares. It is possible that a calculation was incorrect and this can easily be picked up using simple calculations. If you are experinecing financial hardship I am certain they can work out flexible payments but they will not waive the charges or reduce it since it would require adjustments for all of the owners.
0 votes Thank Flag Link Wed Feb 16, 2011
No - assessments are not negotiable. Some condos pay equally throughout the building, some are based on number of bedrooms or unit square footage. This is sometimes when water or heat is involved and definately due to insurance requirements, as many insurance carriers require this.

The only way you can get the fee change on associations is if you are the owner and you become involved in the association. Sometimes associations are not always run the best way and someone else can offer options to decrease costs.
0 votes Thank Flag Link Wed Feb 16, 2011
Dear Buyer,

Home owner's association fees are not negotiable for the most part. You cannot try to reduce/negotiate this amount because it is assessed based on the size (square footage) of the unit. However if you are in a purchase situation, you can request the seller to pay (issue a credit) for a certain number of months to reduce to the costs of ownership in the short-term. I hope you find this helpful- feel free to contact me 312-671-9207 if you have any questions. Best regards, Urvashi Verma @properties.
0 votes Thank Flag Link Wed Feb 16, 2011
Homeowner association fees are not negotiable. I have not heard of anyone negotiating the fees down. I have heard of payment arrangements for someone who has fallen behind or cannot pay a special assessment in full.
0 votes Thank Flag Link Wed Feb 16, 2011
No they are typically not negotiable but for a short period of time you might negotiate that the seller pay them for you as part of the deal. This might be helpful if your current financial picture is tighter than it might be next year.

Separately, instead of comparing list price to list price, you might have your agent compare properties on a monthly cost basis. Add together the mortgage payment (principle, interest and insurance), assessments, 1/12th of the annual taxes and the monthly heating cost. In this way you are really comparing apples to apples properties with different prices, and cost to get a total picture of your monthly expenditure.
0 votes Thank Flag Link Wed Feb 16, 2011
No. In most cases they're voted in based on expenses.
Web Reference: http://www.321property.com
0 votes Thank Flag Link Wed Feb 16, 2011
Hello,

HOA (Home Owners Association) assessments are based on the square footage your unit occupies in comparison to the other units in the building. Also, keep in mind a 1000 square foot unit on the 5th floor will be less than a 1000 square foot unit on the 15th floor. I have never heard of anyone being able to negotiate their assessments down, however, I have heard of people attending their HOA meetings and disputing the floor level increase to assessments. Let me know if I can be of any assistance.

Thanks,

John Gutman
0 votes Thank Flag Link Wed Feb 16, 2011
Hey there!

John's right... the first person mis-read your question and thought you were asking about real estate tax appeals I think....

Anyway, as John mentioned they aren't negotiable... Fees are either increased (or lowered if you're lucky) for all homeowners in the same building and as John mentioned they are calculated based on the condo size and therefore your percentage of ownership. Two other things that greatly affect the assessment cost is the size of the building (part of your assessment goes towards maintenance of common areas - so the smaller the building the smaller the common areas) as well as the number of amenities (which are part of the common area maintenance; pools are usually the most expensive things to maintain as far as amenities go.) It's just part of the cost of being a homeowner unfortunately.

If you have other questions, please don't hesitate to contact me!

Best,
Stephanie
0 votes Thank Flag Link Wed Feb 16, 2011
Each association is different when it comes to how much each fee is. Many things are taken into consideration as to why some buildings are higher. Totaly # of units, whats included, what type of amenities, age, elevators, etc. They are not negotiable, however, once you become a resident you can apply to be on the board and try to find a reason to justify lowering them, although most go up 3% a year.

Matt Laricy
Americorp Real Estate
Brokers Associate, e-PRO
mlaricy@americorpre.com
708-250-2696
0 votes Thank Flag Link Wed Feb 16, 2011
I think you are referring to the condo assessments charged by the condo association and the answer is no. These are based on the expenses of the building and prorated to all the owners based on the size of their unit. Studios pay less than 1 bedroom units and 1 bedroom units pay less than 2 bedroom units. They are not negotiable. Each building has different assessments because their expenses are somewhat different. For an example, buildings that have one central heating system to supply all the units will tend to have a higher assessment than buildings in which each unit has it's own furnace.
0 votes Thank Flag Link Wed Feb 16, 2011
Whoa, previous answer I think misread your question, or i do...
Condo Assessments are passed by the condo board and no they are not negotiable. The HOA fee often varies based on size of condo unit, a 2 BR is cheaper monthly than a 3BR.
0 votes Thank Flag Link Wed Feb 16, 2011
Yes, You may go to the local court house, where real estate records are filed, and fill out an assessment apeal form. The assesment will then be scheduled for review and adjustments will be made if yoiur assessment is not correct.
0 votes Thank Flag Link Wed Feb 16, 2011
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