Special Assessments are a fact of life and should be understood not feared, when looking to buy condos in Edmonton.
In some cases, they arise because of some known repair or deficiency for which the Condo Board failed to collect sufficient reserve funds. However, some issues just crop up unexpectedly and the Condo Board has no choice but to organize the repair and charge the expense amongst the owners.
Contrast the above scenario with owning a single family home. Our home in Edmonton suffered extensive basement flooding a few years ago. There was no provincial assistance program and the insurance policy did not cover water table ingress. The result? A bill for more than $30,000 that we had to pay entirely on our own.
Sharing large expenses over many condo owners is just one of the benefits of the condo lifestyle.
2. Opportunity or Threat?
When representing a condo in Edmonton for sale we often get the question from buyers or their agents, “Are there any special assessments?" This is a fair question and of course we would answer honestly one way or the other.
I cannot help but think however, that most of these folks are missing the bigger picture. They are almost always looking for reasons to eliminate the unit we are selling based on the fact that they will simply add the cost of the special assessment onto the asking price. They see it all as cost!
This is a big mistake in my view. A condo carrying a special assessment provides a number of advantages to a potential buyer. Here’s why:
1. The deficiency is just about to be fixed. It is the buyer that will enjoy the future benefits of the repair or remedy, not the seller.
2. As a buyer you will face less competition to negotiate hard on a unit with a special assessment. Most of the buyers mentioned above will have run away.
3. In some cases you might be able to get the seller to either pay the assessment BEFORE you close on the deal, or you can negotiate the entire or perhaps part of the assessment cost right off the top of the seller’s asking price.
3. Get Help
Of course prudence is recommended and its best to anticipate the likelihood of a special assessment cropping up before you buy any resale condominium.
Careful reading of the minutes to meetings and bylaws would be a good idea. Having a professional review the Reserve Fund Study would also be advised. An expert in the field can quickly determine if fund contributions are in line with anticipated expenses.
We are Realtors® in Edmonton. Can we help you buy? Check out our Condo Spotlight blogs or to reach our broker owner & senior Realtor® Stuart Neal, please call him at: 780-760-2014, or visit www.AmbergateCondos.com