Realtor, DRE# 01891274
Century 21 All Moves
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It is not always the property you buy... it is the neighbors you buy...
Richard "RJ" Kas (SFR, SRES)
"Representing the finest properties from Los Angeles worldwide"
KAS Properties - Coldwell Banker Previews International - Beverly Hills East
9388 Santa Monica Blvd, Beverly Hills, CA 90210
310.859-5334 office - 310.488.9826 mobile - 310-273-0670 fax ATT: RJ
RichardKas@gmail.com - http://www.RJforLA.com - DRE: 01352771
Sellers Buyers Investors Leasing Consulting
If you need assistance, feel free to contact me.
If the property needs maintenance, and there is a deficit of funds available in the HOA account, either the maintenance will be deferred until funds are available, the HOA may have to raise the funds via assessments on the other unit owners, or wait until the foreclosed units pay their dues current.
The condo complex may or may not have deferred maintenance, and if there is an emergency like a plumbing issue, leaky roof, or some other issue, it may take a while for it to be resolved.
It is always a good idea to check the amount of reserves the HOA has.
2. HOA assessment and/or dues increase to make up shortfall
3. If Lenders won't finance prices fall further
Would evaluate much differently if you are purchasing as your residence or a short term or long term investment.
Realtrs do more than find a property or find a buyer. We assist with the hard stuff.
I have sold a couple of condo's where the entire building was bank owned. My clients were able to get rock bottom prices for new construction and the bank was pleased to be able to sell the development. No problems so far with either property.
By the way, there was no problem obtaining FHA financing for either project, so it depends upon the situation with the builder, bank and listing firm.
Future value price of these condos would most likely decrease with over abundance of homes for sale, more negotiation for buyers. Another factor would be that most lenders will have a designated number of owner occupancy required for them to be willing to give loans out to the buyers. Too many of these problems can cause the condo to be able to sold only by cash. Cash buyers will not be able to pay the market value, the condo community over all will be sold at lower price than its surrounding community. However, if the buyer purchase it at a very low cost, in a long run, it will eventually be a good payout.
Cornerstone Real Estate International
IF you are considering making an offer, give address to your lender first (if you are not pre-approved do so) and check before you make an offer as I suspect you will not be able to get a loan on it.
Best of luck.
The extent of services provided by a realtor are many but during a time of financial uncertainty buyers need to be cautioned about extensive vacancy and distressed sales. Today's buyers need to be made aware of the condo's financial stability from every respect and made aware of issues that may affect their purchase. With a 30% vacancy/distressed rate and additional home likely headed toward entering the market, the trend is heading in the wrong direction for buyers that are seeking stability.
The question becomes, "who is paying the necessary community fees?" If the management of the community has been conveyed to the local HOA, this additional financial burden will likely land in the lap of the balance of home owners. Additionally, as time passes and there is no resolution many distressed communities must resort to decreased amenities to survive. This means cutting back on or eliminating maintenance, closing pools, eliminating supportive services, etc. Of greatest concern should be the HOA's ability to meet their insurance expense deadlines. Once a community meets this level of distress a multitude of advanced problems enter the picture.
Our recommendation: smart buyers should be taking into consideration not only the vacancy rate and distressed sales issues, but the communities financial picture as well. When in doubt.....keep looking!
Also, more than likely the HOA budget is running negative as most people under foreclosure stop making their HOA payments... no revenue means delayed maintenance, etc. An insolvent HOA may be forced to increase its dues... either as a one time deal or their monthly dues...
I would ask to see the HOA budget and operating statements before deciding to buy, but you can do that as part of your contingencies after your offer has been accepted.