I am planning to buy a condo in a building which just had a big special assessment recently The Seller is paying the special prior to closing, but

Asked by Spooky, Near North Side, Chicago, IL Thu Sep 10, 2009

will the recent special have an impact on property values, comps, or any other issues I need to be aware of, going in as a new buyer? Thanks.

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Gerry Marzil…, , Oakbrook Terrace, IL
Mon Sep 14, 2009
I would advise you to simply look at the minutes from the board meetings going back at least six months. See what has been talked about. This will give you some sort of idea of what assessments may come up, but, there are still no guarantees.
0 votes
Harry Maisel, Agent, Winnetka, IL
Sat Sep 12, 2009
Good question. It depends on the building you are buying into. Many mature buildings in fact at some point have a special assessment for some type of project. As long as the building has had good management /record keeping over the years, you should feel confident about your purchase. Review the minutes, budgets and and condominium declarations while you are in your attorney review period. Also, see if their has been a steady increase in assessments over the years vs. significant increases over few years. Ask what major projects have been completed. If deferrred projects such as the replacement of chillers, boilers, lobbys, roof, window, and masonry have been taken care of in the past, you should be in good shape. Really high assessments will have somewhat of a negative impact on resale, so take that into consideration.

Good luck!
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Matt Laricy, Agent, Chicago, IL
Thu Sep 10, 2009
The bad thing about special assessments is that once it takes place, you may see lot of units go up for sale in a building. This sometimes also puts a lot of people in foreclosure and you may see some short sales on units. I am not saying it is always the case, but sometimes it is. Just another thing to think about. Good luck!

Matt Laricy
Americorp Real Estate
Brokers Associate, e-PRO
0 votes
The Hagley G…, Agent, Pleasanton, CA
Thu Sep 10, 2009
Good question....there COULD be a problem with value if folks do not pay the assessment.....this could affect HOA reserves, and could possibly result in defaults/foreclosures. On the other hand, the seller is paying for this so you don't have to.

Consult your loacl Realtor.
Web Reference:  http://cindihagley.com
0 votes
Stacy Karel, Agent, Chicago, IL
Thu Sep 10, 2009
Usually a great time to buy a condo since the seller paid for the problems with the building. Read the meeting board minutes to make sure that the special has covered all of the work needed and that nothing is deferred.
Web Reference:  http://www.CONDOChicago.com
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Scott Newman, Agent, Chicago, IL
Thu Sep 10, 2009
You should read my blog on the subject which you can find on my profile.

In the meantime, look at it this way...

Would you rather find out there's a problem with a car you're going to buy and have the seller pay for it so it's totally fixed prior to the purchase being made or would you rather going into the sale blind and hope there's not problems down the road?

Pay close attention to the 22.1 disclosure which will tell the tale of the building. Special assesments are not necessarily a bad thing and if the work is done right- it should be one less things to worry about for years to come.
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