Buying a condominium is an excellent method of reducing the number of personal homeownership responsibilities you may have carried all these years, but new owners need to realize that the need for maintenance continues, even if that responsibility is not theirs alone!
When these "jointly owned" assets are neglected, you (the condominium owner and association member) still have a direct responsibility for the repair and/or replacement of this asset. The assets’ visual appearance and general condition will greatly affect the value of all properties in the association, and the association is directly responsible for all the jointly held properties.
When failure occurs, and repairs or replacement are needed, the association must take steps to carry out and pay for these repairs or replacements. In many cases, this can be an extensive problem for an association to tackle often resulting in "special assessments" to the homeowners.
An acceptable method available to protect a condominium owner's ability to address the costs of repair or replacement is through reserving funds specifically for the replacement of major assets. Some assets, like roofs, will always need to be replaced. The same condition exists with siding, painting, elevated decks and walkways.
The best method for an association to determine their needs for "replacement reserve funds" is a Major Asset Replacement Reserve Study.
Without such a study, owners often overlook the condition of jointly held assets until they fail - and special funding for repairs or replacement must be found.
Experienced condominium buyers recognize that a carefully addressed plan for collecting and reserving funding for repairs and replacement is their best protection against future assessments. The reserve fund, in itself, is a valuable asset to a potential buyer of a condominium.
