Condominium must be the most popular new word in today's housing vocabulary.
It's a lifestyle that is catching on everywhere because Americans now have better things to do with their spare time than take care of the lawn or paint the house.
The condominium is promoted as thee "no-care" way to live. What the promotions don't say, of course, is that there is a price to pay for the freedom and it comes in the form of monthly maintenance fees which most buyers are happy to pay so someone else can assume management and repair responsibility.
But just what is a condominium, any way?
If you buy one, you will own a structure or a unit within a structure, and an undivided interest in the common property in the complex - hallways, recreation areas, grounds, roof, building frame, exterior walls and other features not a part of any specific residence.
Undivided interest means that all owners in a complex - which can be any size from 2 to 2,000 units - own a proportional share of the common property. However, one owner couldn't prohibit the others from a proportional interest.
The share that each owns in determined by a complex calculation of the value of this unit, divided into the total value of the entire complex. The share is not simply determined by dividing the number of units into the total because values differ depending on location within a building or complex.
That value ratio never will change no matter what the resale price of that unit or any other.
Though it's slightly confusing, a unit twice the value of yours would own twice the share of common property and its owner, then, would have to pay twice the maintenance fee or share of common expenses, and that owner also would have twice as much voting power in a decision required of the group of owners.
The proportional value is determined at the time the property is registered or declared.
A condominium, as any other property, has a legal description of its airspace bounded by its interior walls, doors, windows and other surfaces, together with parts of the building inside its boundaries.
Such a unit can be sold the same way as a home or vacant land. But the sale also includes the unit's share of undivided interest.
Sometimes, but not always, a condominium unit be rented by the owner, or subleased. But that depends on what the declaration says about that.
The declaration is a basic document which establishes the property as a condominium and contains a long list of details such as the proportional values of the units, legal descriptions, purpose, restrictions such as for rentals, and directions for what is to happen if parts or all of the property is destroyed and how the declaration could be amended in the future.
If you're thinking of buying a condominium, careful study of this declaration is a must, along with inspection of the physical features. Each declaration is different. But if you understand what it means, there will be no surprises in the future if you are billed to help pay for repairs or if you are prohibited from subletting or keeping a pet.
The declaration must be filed with local government and is a public document available to all.
Condominiums are not always new properties. There's been a lot of controversy across the country this year because many apartment buildings are being converted into condominiums and the units sold.
Sometimes these older buildings are lower priced than new housing in an area and they are growing in popularity with first-time buyers who can't afford a home at today's high prices.
Prospective purchasers of condominiums should investigate the workmanship and quality of materials in both the public and private spaces of a complex, and in both new and used buildings. If there is need for major repairs, such as a leaky roof or a faulty swimming-pool filter, each owner will be expected to pay for the repairs, either out of reserves set aside from monthly fees, or by direct billing for his share.
Condominium living is carefree, but certainly not without financial responsibility.
Property taxes are assessed by local governments against condominiums as any other residence and also against the share of common interest.
If you're considering buying a condominium on leased land, consider the matter of the lease and be aware that when that lease expires the land owner has the option to raise his rates (and probably will).
Experts predict millions more Americans will be buying and living in condominiums in the next few years. The lifestyle is appealing to some persons and multiple residences do save land and resources.