In Australia, the body corporate levies have 2 components: one for administration which covers operational expenses; and one called "sinking funds" which builds up funds for future repairs & maintenance (such as external painting or major repairs - like replacing the roller door of an underground carpark). When we look to buy an apartment (or condo), we check out the levies and see how much there is in the sinking fund account (particularly for old buildings). So, the US and Australian systems are very similar.
Monique: It is interesting that you mentioned avoiding condos with pending litigation. I saw some nice ones going for very cheap because there is a court case between the condo owners and the land owners over the fees (the website said currently $200 a month and could go to $2,000 a month!)
HOA dues are paid monthly. Typically they run anywhere from 150 per month to 1000 per month for luxury buildings with valet for example. They usually include common area maintenance, earth quake insurance (sometimes), utilities for common areas, water, cleaning, management .Buildings usually like to have some reserves set aside. Typically 6 months of HOA fees per unit is considered good. If there aren't enough reserves than an assesment will have to be made to each unit to cover major improvements. HOA are generall paid monthly. Property taxes in California at about 1.1.5-1.25& of the sales price (unlike other states this is fairly low) and do not change unless there is a change in ownership or you make substantial improvements which generate a building permit. Owner's of condos pay property taxes just like homes. It sounds like the corporate levies is Australia are simiar to the monthly HOA fees charged in the states. Also, with a condo you do not own the land, you own airspace. In townhouses which have land some times you own a fraction of the total lot. The tax is payable whether is is leased or you live in the property.
As far as any other costs you should be aware of, read the HOA CC&Rs very carefully. Insure that their are adequate reserves for the building and no pending litigation or assessments for major work and if they are you might want to request a credit on the purchase.
The Reavis Group
Costs include HOA dues, which are due on a monthly basis. What they cover varies depending on the unit you buy. Some homeowners dues cover many things including water, gas, cable or satellite TV, earthquake insurance (some associations have it, while some choose not to) etc... while others do not cover all of these things. This is really on a case by case basis. Most HOA dues cover maintenance of the common areas, gardening, etc. If any work is needed, like new plumbing or a new roof for the building, a special assessment could be ordered as mentioned below.
Many lenders will also require you to have property insurance in order to get your loan. Most HOA's have their own liability insurance but many lenders will still require you to get insurance to cover your unit, in case there is a fire, flooding, etc.
Condo owners in the united states do pay property taxes, which are due twice each year and vary by area, but a good rule of thumb is about 1.2% or more of the purchase price.
Good luck with your purchase! Prices must look great to you right now!
Property owners of Condos pay their own Property tax (sorry I don't think there should be property tax).
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Also, you are correct about what HOA dues cover. Sometimes water, sometimes not, sometime Earthquake Insurance, sometimes not. It is always case by case so read through and be comfortable before you remove your contingencies.
A typical condo cost breakdown could be as follows: Purchase Price $325,000 with 20% down at 6.5% = $1645 p/m. Monthly HOA at around $300 p/m typically covers common area maint. and exterior. Property tax would be right around $3,600 a year ($300 p/m). Personal Property insurance should be under $100 per month. Total would be about $2345 per month.
Just 2 big cautions. Read through all the HOA documentation (consider sitting on the board) and don't hesitate to ask your Realtor for an Estimated Buyer's Cost or something similar. Also make sure your mortgage broker provides you a HUD 1 or good faith estimate for the costs associated with the financing. Even though they are estimates, they will give you a good idea of what to expect.
It can be overwhelming but as long as you are armed with good, solid information upfront, you will find it is very workable.