[fb_button]If you have invested, or are thinking about investing in a condo, you must come to terms with the fact that a large part of your investment is in the hands of others. Common parts of the building—the exterior, the lobby, the hallways—are owned collectively. That is why communication with your fellow owners is absolutely crucial when evaluating and managing an investment property.
Homeowners’ associations were created in part to handle this task. Owners who are interested in how building operations are run can get on the board and have a say in the future of the building’s management. However, open communication with your neighbors should not only happen through the formal channels of the association.
It is generally a good idea to get to know your neighbors, especially those who are close by—underneath or over you, and on both sides—as soon as possible, preferably before you even invest. The lifestyle and habits of these neighbors can, and will, affect the value of your investment. Some questions to consider are: Are the units owner-occupied or rented (banks tend to value owner occupancy)? Are the occupants clean? Are they considerate of the common areas and mindful of things like noise regulations?
As you initiate contact with the owners around you, you should try to find out their plans for the future. If the owners on all four sides of you are planning to sell within the next couple of years, their decisions will ultimately affect the valuation of your investment. Long-term owners with stable, responsible tenants tend to be a safer bet than someone trying to flip the condo in 6 months for a quick profit.
With any kind of investment, the more information you have, the better your chance of success. Real estate is no different, and open communication with your fellow owners will only help the security of your investment.[fb_button]