Did an apartment catch your eye and are you about to buy it? But beware, before acquiring a condominium property, it is strongly advised to learn about its financial management.
Condominium: before buying, check the financial management
By buying real estate in a condominium, you will become a co-owner. This means that you will have to pay charges that will contribute to the proper functioning of the residence (maintenance of the common areas, lighting of the parking lot, etc.). Expenses that can become substantial if the condominium is poorly managed. Before buying your apartment, it will therefore be necessary to check that the condominium is well managed. You must ask to consult the accounts given to the co-owners by the trustee during the general meeting.
This will allow you to know the percentage of arrears. If this is high, this means that the co-owners do not always pay on time and that the co-ownership encounters difficulties in recovering the sums due. The trustee could therefore be forced to make additional calls for funds from the other co-owners to honor the invoices. Also check whether the trustee has put in place a procedure for handling arrears by consulting the minutes of previous general meetings. Also remember to check that the suppliers (gas, electricity, fuel, water, etc.) are well paid: if there are many debts, the condominium risks a suspension of the contract.
Charges, fundraising… check upcoming expenses
It is also necessary to look at the budget voted by the last general assembly before buying your apartment. This fixes the expenses of the condominium for the following year. This will allow you to discover the sums that you may owe to the co-ownership during the coming months and to verify that they are consistent. These sums can be linked to works (facelift, elevator, doors, etc.) voted in advance but whose fundraising is planned for dates after the sale.
The minutes of the last general meeting will tell you on what date the calls for funds for the payment of the works will be made. It is preferable that these fundraising calls are scheduled over several years, to stagger the payment and avoid the risk of non-payment in the condominium. Note that since the implementation of the ALUR law, certain documents on the state of the co-ownership must now be annexed to any sales agreement.
These documents will give you information on the costs incurred by the co-ownership and the amounts that you will have to pay. Before buying, also ask the trustee for the building maintenance booklet, to find out about the condition of the residence: poor condition will increase the probability of work in the medium term.
Is the co-ownership insured?
Before buying an apartment in a condominium, it is also necessary to check that it is well insured, to avoid any disappointment later: without insurance, you might not get reimbursement for your damage in the event of a claim. If the condominium in which you plan to buy was built less than 10 years ago, damage insurance must be included in the bill of sale.
This insurance is essential because it will allow you to obtain compensation for any damage affecting the solidity of the building or making it unsuitable for its destination, without having to look for the responsibility of each company. Note that in the event of serious damage, if no damage-to-work insurance has been taken out, you may take action against the seller of the property. The latter can then turn against the companies concerned. In addition to damage insurance, please note that the syndicate of co-owners has the obligation to take out multi-risk insurance. Note that the deed of sale must notify you in the event of a lack of insurance.