5 ms·

I sat on my condo board for a decade and was president for two years. My experience is that the board is not the problem - the non board sitting owners are. O

I sat on my condo board for a decade and was president for two years. My experience is that the board is not the problem - the non board sitting owners are. Our complex was comprised of 5 separate 3 story buildings. Three of those building had bad water leaking problems but when we tried to raise money for repairs - the people who weren't suffering any interior water damage wouldn't vote yes. Many buyers don't read the fine print or dig into the boards finances before they buy. We ultimately passes a special assessment but not without some serious "log-rolling" to get everyone on board. Nobody wants to pay for what is a collective problem. Sometimes I think condo's shouldn't even be legal because of this. They should all be apartments with a central management company. The solution is really tightening fiducial regulations on condo HOA's. There could easily be a formula of like 10% of annual dues need to be put in a rainy day fund or something... Banks have started to tighten their lending around condos and ask for more up front financial info.

mchristen 5y ago
I can relate to this. My parents lived in a 22 story building that had water leaks throughout the entire building from construction defects. Until my mom literally got herself elected to be the president of the condo board nobody seemed to care that the building was broken. Many years later and a lawsuit against the developer, the building association and the owners were finally able to get compensated AND have the construction defects fixed. There is no way you can financially prepare for the magnitudes of repairs needed in their case.
breck 5y ago
We recently bought a condo after renting in the building for three years. The board, management and staff of our building are phenomenal—an inside bit of information we knew from having lived here. We looked at a large number of buildings in the area, and was surprised that maybe 1% of the information you need to assess board/management competence is available online. Generally we'd have to do our own DD talking to people in the buildings. IMO it makes a huge difference, >10% of the purchase price should be on the quality of the board and management. Seems like a startup opportunity to be Yelp for Condo Boards/HOAs. (I'm sure there are a dozen+, of course. I haven't done the DD on that!)
- zacharycohn 5y ago
  An acquaintance of mine is building https://www.upliftinc.co https://www.upliftinc.co after experiencing similar issues.
- mooreds 5y ago
  All I want is for someone to build a HOA portal that isn't horrible. The two I've had experience with were old old school, slow, and super painful.
  - lotsofpulp 5y ago
    Is there a need for a portal? A website with the condo’s documents/minutes/spreadsheets/videos seems like it suffices. A forum can also be setup if necessary.
    - toomuchtodo 5y ago
      That’s the portal, usually has login/auth for unit owners, and backend admin functions for the condo board or their management company.
      - lotsofpulp 5y ago
        I do not see a need for login. What could be confidential?
        mooreds 5y ago
        Setting up ACH to pay dues. Board meeting minutes are not hidden from owners, but probably are not public info. (Stuff like bids and fines are recorded there.)
    - mooreds 5y ago
      Things I need from an HOA portal: * ticketing system with management company * way to set up ACH/dues payments * ways to look at docs and minutes * way to communicate with the board * calendar of the board meetings * way to communicate with the other owners Sure, you could put that together mostly with Gsuite functionality, but an integrated modern product would be really great.
paxys 5y ago
A good middle ground is condos with a central management company. Dues get a lot more expensive, yes, but residents can benefit from professional maintenance, repairs/renovations, assessments, book keeping etc. without needing to squabble among themselves.
- bluGill 5y ago
  Maybe. Real Estate investments tend to not use those companies because even though they should be good, many of them are bad. Not all, but be very careful to get a good one.
gnopgnip 5y ago
>There could easily be a formula of like 10% of annual dues need to be put in a rainy day fund or something Fannie mae and freddie mac require at least 10% of gross dues go into reserves. FHA and VA have higher standards. So only cash buyers, or buyers with non standard loans can buy condos that don't meet this requirement. But unless a condo is a townhome style building where there is very little common property this should really be 25% or higher
edwhitesell 5y ago
I sat on the board in my previous neighborhood and served two terms as president, this was definitely true for that community too. And, many other HOAs of individual homes (structures) too. We were lucky to have a decent management company that provided a lot of guidelines and information about what we should be doing. As well as the things we were obligated to do (either because of bylaws or laws, in Texas). Still, any time there was a storm resulting in additional costs for landscaping/cleanup, or work on a damaged/degrading stone wall, or the pool area, etc. We heard about it from some neighbors who didn't want to spend any money, because it didn't directly affect them. It's definitely an area that more regulations would help everyone involved. We were not experts, but could make some decisions if we had the right information (or knew what questions we should ask).
giantg2 5y ago
"Nobody wants to pay for what is a collective problem." Yet they choose to live in a collective structure. It's essentially another level of government entered into via contract. Maybe they should choose to live in an independent residence if they didn't want that.
- ghaff 5y ago
  Although it's not that easy. Now the choice is either just rent or buy a single family home (which they may not be able to afford where they live). Eliminating the condo option forecloses ownership for many--and, for those who strongly advocate for urban density--disperses people over a much larger area. But collective structures are difficult at all scales. Some people have a fair bit of money and want issues, even just aesthetic ones, fixed now. And others are probably living paycheck to paycheck.
- JohnWhigham 5y ago
  It's a nasty sentiment that's inculcated into virtually all Americans since birth; any problem beyond our property line we don't give a fuck about. Hilariously ironic of course for people that choose to buy property in a building owned by someone else.
  - giantg2 5y ago
    Not really. Maybe it's more pronounced in specific areas of the US. I know plenty of people who care about their local communities and neighbors.
    - lotsofpulp 5y ago
      Everything is fine and dandy when everyone is experiencing growth. But there is a point where when sacrifices need to be made, things start getting tribal real fast. I think there is an underlying trend of that due to certain populations’ socioeconomic status slipping, and I think with the slowdown in population growth, we will be seeing more if it as society decides how to allocate fewer resources.
codegeek 5y ago
One of the biggest reasons Condos are not for me. I just cannot have my life depend on decisions made by others because we share common areas. Not to mention that Condo monthly fees are still very high and they cannot cover stuff like this.
xxpor 5y ago
>Nobody wants to pay for what is a collective problem. Sometimes I think condo's shouldn't even be legal because of this. They should all be apartments with a central management company. We shouldn't have a democracy; people won't vote for reps who will vote to pay for things that don't directly affect them. It's a problem as old as time :) Buying into a condo has the risk of this sort of thing happening. It has to be carefully assessed. IMO for condos specifically, the board shouldn't have to hold a referendum to do special assessments. It should be a majority of the board.
mdavidn 5y ago
This. My 36-unit building undertook a massive project in recent years to repair structural water damage under (shocker) a pool deck that wasn't properly sloped. A few owners would yell at the volunteer board and threaten lawsuits at every HOA meeting. Others would idly muse that we shouldn't look for problems lest we find more structural members with damage.
cure 5y ago
> There could easily be a formula of like 10% of annual dues I was on the board of a 10 unit condo building. The annual budget for the association was ~$60k. We had a reserve provision of 10% of dues, plus whatever was leftover in the budget at the end of the year. Even with that budgeting provision we had several additional assessments over the course of a decade. Those assessments were used to address roof issues and interior renovations. If something more structural had come up, that would have led to another (large) assessment, for sure.
brandonbloom 5y ago
Experienced something similar to with my previous home's HOA in south Seattle. New chairperson took over the HOA and found out that the rainy day accounts were woefully underfunded and several shared roofs were in need of repairs, so dues had to be increased pretty dramatically. The frustrating part for me as a homeowner was that dues were assessed based on square footage, but out of 200+ homes, ours was one of the only 15 or so that were fully detached. We had use of a communal driveway we shared with 5 neighbors as well as a small private park 2/3rds of a mile down the road, but other than that, we were fully responsible for all of our unshared infrastructure. If our roof had a problem we had to fix it at our own expense, even though we paid in to the roof repair fund. There were were many more homes (ie. a city or a country instead of a neighborhood) or if there was a greater variety of homes (ie. a larger percentage of detached homes) or if there was some obvious wealth disparity (ie. our detached home wasn't smaller than many of the attached homes) or some other mitigating factors, I'd have been happy to pay in on the assumption that "what goes around comes around" and "rising tide raises all ships", but in this case, my partner and I felt pretty cheated. That said, we didn't make a stink. We just paid the damn dues (...and then later moved somewhere without an HOA).
mooreds 5y ago
I was on a condo board for two years. We had regular reserve studies and raised dues almost every single year (1-5%). When I talked to other homeowners and prospective home buyers, they always said "seems like dues are pretty high for that complex". It isn't fun to pay dues that are ~50% of your mortgage payment. But we were able to pay for repaving the parking lot (5 figure project, I think, I was off the board by then) and replacing two elevators (6 figure projects) without a special assessment. I would much much rather have dues increase regularly and not have special assessments than the reverse. Deferred maintenance is not good (and obviously can be dangerous). It's one thing when it is happening at a single family home, where all the risk and reward are localized. But when it happens at the group level, being proactive is a huge win, even when it is painful.
- x0x0 5y ago
  I read somewhere -- unfortunately can't find it -- that the fees for the repairs to the collapsed condo where $90k-ish for even the smallest units there. I can't imagine a world where you get an inspection done and residents get told congrats! you owe $100-$350k (depending on the size of your unit) where that isn't a glacially slow process that doesn't generate lots of pushback. Particularly in Florida where I bet you have lots of retired folks living in those condos. edit: I was off on the numbers. $80k for the smallest units to $336k for a penthouse [1]. Doesn't really change my conclusion about how folks react when they wake up and get a low six figure bill [1] https://www.cnn.com/2021/06/28/us/surfside-condo-owners-assessments-invs/index.html https://www.cnn.com/2021/06/28/us/surfside-condo-owners-asse...
baybal2 5y ago
A fully rent only buildings are always easier in this regard. Either the corporate landlord fixes things, or people vote with their feet.
cardiffspaceman 5y ago
Congratulations on successfully politicking to get those repairs funded. I lived in a condo complex where the association had its VP resign, so I put my hat in the ring, and even though my track record was only speaking up and attending meetings, I won with N-1 votes out of N. The board put forward a resolution, which passed by a huge majority, to make most large, non-monthly costs special assessments. The resolution came with written language about how people were going to have to fund their share of large costs like roof fixes from their savings. I though this was reasonable. The special case here is that 60 units were owned as individual residences and 300 units were owned by a corporation and rented like apartments. So I was amazed that they voted all their votes for me in the VP election, and not amazed that they would want to fund roof repair and such the new way. The Surfside situation would not have been changed by the resolution about funding repairs. If that corporation had looked at our building before taking over, and saw what the inspectors saw in Surfside, they wouldn't have bought in in the first place.

mchristen 5y ago

I can relate to this. My parents lived in a 22 story building that had water leaks throughout the entire building from construction defects. Until my mom literally got herself elected to be the president of the condo board nobody seemed to care that the building was broken. Many years later and a lawsuit against the developer, the building association and the owners were finally able to get compensated AND have the construction defects fixed. There is no way you can financially prepare for the magnitudes of repairs needed in their case.

breck 5y ago

We recently bought a condo after renting in the building for three years. The board, management and staff of our building are phenomenal—an inside bit of information we knew from having lived here. We looked at a large number of buildings in the area, and was surprised that maybe 1% of the information you need to assess board/management competence is available online. Generally we'd have to do our own DD talking to people in the buildings. IMO it makes a huge difference, >10% of the purchase price should be on the quality of the board and management. Seems like a startup opportunity to be Yelp for Condo Boards/HOAs. (I'm sure there are a dozen+, of course. I haven't done the DD on that!)

zacharycohn 5y ago
An acquaintance of mine is building https://www.upliftinc.co https://www.upliftinc.co after experiencing similar issues.
mooreds 5y ago
All I want is for someone to build a HOA portal that isn't horrible. The two I've had experience with were old old school, slow, and super painful.
- lotsofpulp 5y ago
  Is there a need for a portal? A website with the condo’s documents/minutes/spreadsheets/videos seems like it suffices. A forum can also be setup if necessary.
  - toomuchtodo 5y ago
    That’s the portal, usually has login/auth for unit owners, and backend admin functions for the condo board or their management company.
    - lotsofpulp 5y ago
      I do not see a need for login. What could be confidential?
      - mooreds 5y ago
        Setting up ACH to pay dues. Board meeting minutes are not hidden from owners, but probably are not public info. (Stuff like bids and fines are recorded there.)
  - mooreds 5y ago
    Things I need from an HOA portal: * ticketing system with management company * way to set up ACH/dues payments * ways to look at docs and minutes * way to communicate with the board * calendar of the board meetings * way to communicate with the other owners Sure, you could put that together mostly with Gsuite functionality, but an integrated modern product would be really great.

paxys 5y ago

A good middle ground is condos with a central management company. Dues get a lot more expensive, yes, but residents can benefit from professional maintenance, repairs/renovations, assessments, book keeping etc. without needing to squabble among themselves.

bluGill 5y ago
Maybe. Real Estate investments tend to not use those companies because even though they should be good, many of them are bad. Not all, but be very careful to get a good one.

gnopgnip 5y ago

>There could easily be a formula of like 10% of annual dues need to be put in a rainy day fund or something Fannie mae and freddie mac require at least 10% of gross dues go into reserves. FHA and VA have higher standards. So only cash buyers, or buyers with non standard loans can buy condos that don't meet this requirement. But unless a condo is a townhome style building where there is very little common property this should really be 25% or higher

edwhitesell 5y ago

I sat on the board in my previous neighborhood and served two terms as president, this was definitely true for that community too. And, many other HOAs of individual homes (structures) too. We were lucky to have a decent management company that provided a lot of guidelines and information about what we should be doing. As well as the things we were obligated to do (either because of bylaws or laws, in Texas). Still, any time there was a storm resulting in additional costs for landscaping/cleanup, or work on a damaged/degrading stone wall, or the pool area, etc. We heard about it from some neighbors who didn't want to spend any money, because it didn't directly affect them. It's definitely an area that more regulations would help everyone involved. We were not experts, but could make some decisions if we had the right information (or knew what questions we should ask).

giantg2 5y ago

"Nobody wants to pay for what is a collective problem." Yet they choose to live in a collective structure. It's essentially another level of government entered into via contract. Maybe they should choose to live in an independent residence if they didn't want that.

ghaff 5y ago
Although it's not that easy. Now the choice is either just rent or buy a single family home (which they may not be able to afford where they live). Eliminating the condo option forecloses ownership for many--and, for those who strongly advocate for urban density--disperses people over a much larger area. But collective structures are difficult at all scales. Some people have a fair bit of money and want issues, even just aesthetic ones, fixed now. And others are probably living paycheck to paycheck.
JohnWhigham 5y ago
It's a nasty sentiment that's inculcated into virtually all Americans since birth; any problem beyond our property line we don't give a fuck about. Hilariously ironic of course for people that choose to buy property in a building owned by someone else.
- giantg2 5y ago
  Not really. Maybe it's more pronounced in specific areas of the US. I know plenty of people who care about their local communities and neighbors.
  - lotsofpulp 5y ago
    Everything is fine and dandy when everyone is experiencing growth. But there is a point where when sacrifices need to be made, things start getting tribal real fast. I think there is an underlying trend of that due to certain populations’ socioeconomic status slipping, and I think with the slowdown in population growth, we will be seeing more if it as society decides how to allocate fewer resources.

codegeek 5y ago

One of the biggest reasons Condos are not for me. I just cannot have my life depend on decisions made by others because we share common areas. Not to mention that Condo monthly fees are still very high and they cannot cover stuff like this.

xxpor 5y ago

>Nobody wants to pay for what is a collective problem. Sometimes I think condo's shouldn't even be legal because of this. They should all be apartments with a central management company. We shouldn't have a democracy; people won't vote for reps who will vote to pay for things that don't directly affect them. It's a problem as old as time :) Buying into a condo has the risk of this sort of thing happening. It has to be carefully assessed. IMO for condos specifically, the board shouldn't have to hold a referendum to do special assessments. It should be a majority of the board.

mdavidn 5y ago

This. My 36-unit building undertook a massive project in recent years to repair structural water damage under (shocker) a pool deck that wasn't properly sloped. A few owners would yell at the volunteer board and threaten lawsuits at every HOA meeting. Others would idly muse that we shouldn't look for problems lest we find more structural members with damage.

cure 5y ago

> There could easily be a formula of like 10% of annual dues I was on the board of a 10 unit condo building. The annual budget for the association was ~$60k. We had a reserve provision of 10% of dues, plus whatever was leftover in the budget at the end of the year. Even with that budgeting provision we had several additional assessments over the course of a decade. Those assessments were used to address roof issues and interior renovations. If something more structural had come up, that would have led to another (large) assessment, for sure.

brandonbloom 5y ago

Experienced something similar to with my previous home's HOA in south Seattle. New chairperson took over the HOA and found out that the rainy day accounts were woefully underfunded and several shared roofs were in need of repairs, so dues had to be increased pretty dramatically. The frustrating part for me as a homeowner was that dues were assessed based on square footage, but out of 200+ homes, ours was one of the only 15 or so that were fully detached. We had use of a communal driveway we shared with 5 neighbors as well as a small private park 2/3rds of a mile down the road, but other than that, we were fully responsible for all of our unshared infrastructure. If our roof had a problem we had to fix it at our own expense, even though we paid in to the roof repair fund. There were were many more homes (ie. a city or a country instead of a neighborhood) or if there was a greater variety of homes (ie. a larger percentage of detached homes) or if there was some obvious wealth disparity (ie. our detached home wasn't smaller than many of the attached homes) or some other mitigating factors, I'd have been happy to pay in on the assumption that "what goes around comes around" and "rising tide raises all ships", but in this case, my partner and I felt pretty cheated. That said, we didn't make a stink. We just paid the damn dues (...and then later moved somewhere without an HOA).

mooreds 5y ago

I was on a condo board for two years. We had regular reserve studies and raised dues almost every single year (1-5%). When I talked to other homeowners and prospective home buyers, they always said "seems like dues are pretty high for that complex". It isn't fun to pay dues that are ~50% of your mortgage payment. But we were able to pay for repaving the parking lot (5 figure project, I think, I was off the board by then) and replacing two elevators (6 figure projects) without a special assessment. I would much much rather have dues increase regularly and not have special assessments than the reverse. Deferred maintenance is not good (and obviously can be dangerous). It's one thing when it is happening at a single family home, where all the risk and reward are localized. But when it happens at the group level, being proactive is a huge win, even when it is painful.

x0x0 5y ago
I read somewhere -- unfortunately can't find it -- that the fees for the repairs to the collapsed condo where $90k-ish for even the smallest units there. I can't imagine a world where you get an inspection done and residents get told congrats! you owe $100-$350k (depending on the size of your unit) where that isn't a glacially slow process that doesn't generate lots of pushback. Particularly in Florida where I bet you have lots of retired folks living in those condos. edit: I was off on the numbers. $80k for the smallest units to $336k for a penthouse [1]. Doesn't really change my conclusion about how folks react when they wake up and get a low six figure bill [1] https://www.cnn.com/2021/06/28/us/surfside-condo-owners-assessments-invs/index.html https://www.cnn.com/2021/06/28/us/surfside-condo-owners-asse...

baybal2 5y ago

A fully rent only buildings are always easier in this regard. Either the corporate landlord fixes things, or people vote with their feet.

cardiffspaceman 5y ago

Congratulations on successfully politicking to get those repairs funded. I lived in a condo complex where the association had its VP resign, so I put my hat in the ring, and even though my track record was only speaking up and attending meetings, I won with N-1 votes out of N. The board put forward a resolution, which passed by a huge majority, to make most large, non-monthly costs special assessments. The resolution came with written language about how people were going to have to fund their share of large costs like roof fixes from their savings. I though this was reasonable. The special case here is that 60 units were owned as individual residences and 300 units were owned by a corporation and rented like apartments. So I was amazed that they voted all their votes for me in the VP election, and not amazed that they would want to fund roof repair and such the new way. The Surfside situation would not have been changed by the resolution about funding repairs. If that corporation had looked at our building before taking over, and saw what the inspectors saw in Surfside, they wouldn't have bought in in the first place.