Home Selling in Chicago>Question Details

jdmazzochi, Home Owner in Chicago, IL

Can the number of units owner by one family be limited in a 90 unit condo building? Is there a law that prohibits this?

Asked by jdmazzochi, Chicago, IL Thu Nov 1, 2012

We have a janitor who s buying up condos in the building 4 so far and renting them.
Is there a law that can stop this from happening. The building is in Illinois. It is a bad thing for he has voting rights etc.

Help the community by answering this question:

Answers

12
Manuel Brown (312) 600-5710’s answer
Dear Condo owner I can understand your concern. Over the pat five years I have seen a variety of rules put in place by condominium associations.

The first thing I would do is read the condominium bylaws to see if there are any existing rules owners have to follow before renting their condo. If there are no rules in place you need to bring your concerns to the board.

Here are a few rules I have seen in place by associations:

1) The board has to approve all renters.
The board generally wants 3 references from the potential renter as well as the application and credit report.
2) The board has move-in and move-out fees.
3) The bylaws require the owner to live in the condo for at least 1 year.
4) The bylaws limit the number of years any one condo can be rented.
5) The bylaws limit the total number of condos can be rentals. (Works in conjunction to number 4 to be fair to all owners.)

Remember when presenting changes to current bylaws to present them in a matter to show how the proposed rules will benefit all the condo owners.

Also when amending bylaws it would be prudent for the board to contact an attorney to make sure all the proper paperwork is filled currently and meet the guidelines of the Illinois Condominium Property Act and Common Interest Community Association Act.

Best of luck,
1 vote Thank Flag Link Thu Nov 1, 2012
the rules and regulations should cover this question
0 votes Thank Flag Link Fri Nov 2, 2012
Hello,

Even though there is no law preventing him from buying as many as he wants, future buyers may not be able to finance a purchse in a building that has 10% or more of the units owned by one entity. Depends on the lender and association decs/bylaws & rules/regs.

Sounds like the janitor is cleaning up (no pun intended) but maybe should be made aware of the possible non resale aspect due to too high of an interest owned.

Good luck!
0 votes Thank Flag Link Thu Nov 1, 2012
No "law" prohibits his actions, however, take a look at your association's declaration and by-laws. These are the documents which govern your relationship to other unit owners. There may or may not be restrictions contained in those documents. Also, unit owners have the right to change their bylaws to address changing situations. If there is a problem, and you can convince the requisite number of unit owners to adopt your position, then you could effect a change. You should consult with an attorney that specializes in condominium law. If you need a recommendation, just let me know.


Rusty A. Payton, Broker
iMove Chicago
5650 N Broadway
Chicago, Illinois 60660

773-961-8819 [Office]
773-289-0806 [Fax]
773-682-5210 [Mobile]

e. payton@iMoveChicago.com


http://www.iMoveChicago.com

blog: iMoveBlog.com
0 votes Thank Flag Link Thu Nov 1, 2012
Seems that this janitor is smart and sees an opportunity in your building. There are no laws against this and it does happen often. Once he has enough units he will be able to gain control over the association.




Sohail A. Salahuddin | Group Founder

Innovative Property Consultants Group | Sales and Leasing

http://www.innovativepropertyconsultants.com



Jameson Sotheby’s International Realty

425 W. North Ave. | Chicago, IL 60610 


O: 312.335.3230 | C: 312.437.7799 | F: 847.805.6030

"Locally Known, Globally Recognized"
0 votes Thank Flag Link Thu Nov 1, 2012
There is no law to prevent this from happening. Yes, like all owners he has voting rights, and he also is increasing the amount of money he pays to support the building via the assessment.
A careful read of the by laws will let you know what limitations owners can place on rentals and non owner use of the units.
0 votes Thank Flag Link Thu Nov 1, 2012
No law at all. The association can pass one though.
0 votes Thank Flag Link Thu Nov 1, 2012
Best to call attorney James Schultz 773 680 7426 for free consultation
0 votes Thank Flag Link Thu Nov 1, 2012
No State of IL law - This is an association issue and the condo bylaws may offer some guidelines as per maximum unit ownership by one individual or entity.
0 votes Thank Flag Link Thu Nov 1, 2012
You will want to address this with the condo board - you want to make sure that your building doesnt become difficult to finance. Most conventional lenders will not lend in a Condo project if 1 person owns more than 10% of the units. There is also a concern regarding rental concentration. Some lenders will not lend on a project if you have more than 30% of the units listed as non owner occupied. There are several that will go up to 49% for the rental concentration but you will be limiting your options.
Sam Sharp
Senior VP of Mortgage Lending
Guaranteed Rate
773-290-0455
0 votes Thank Flag Link Thu Nov 1, 2012
There are no laws that prohibit this. Check your condo by-laws to see if they address this issue. You should bring your concerns to your board. You can ask for a vote to add an amendment to your rules/regs outlining such scenarios.

Good Luck!

Kelli Johannesen-Logan
@properties
kelli@ChicagoUrbanLiving.com
0 votes Thank Flag Link Thu Nov 1, 2012
No law for that, but many condo buildings have restrictions on the total # of units that can be rented. If the owner occupancy falls below 75% it can be a negative factor for potential new buyers and some lenders do not like making some loans in such buildings.
I guess you could create a rule to prevent any one individual from owning more than a certain % of units, but check with an attorney on it.
0 votes Thank Flag Link Thu Nov 1, 2012
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2014 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer