A $49,790 Special Assessment charged to unit owners of a New Jersey Townhouse Community
“First of all…don’t get scared out of buying a condo or townhouse. This does not typically happen. In my 35 years of a being a Broker, this is the most extreme case I have heard about.“….. Warren Damiano
Yes, it’s unfortunately true…Ugh…. A local townhome community in North Jersey just hit it’s owners up with a special assessment on some units for $49,790!
Buying in a condo community has it’s perks and sometimes downfalls. No lawn to cut, no shoveling, pack up and go anytime. But it also may have it’s negatives which you should be cognizant of. That is why it is extremely important to work with a knowledgeable Real Estate Professional who knows the ins and outs of communities they sell in.
A “Special Assessment” is a fee charged to homeowners in a community when a repair to the buildings or grounds comes up that is either unexpected, not budgeted for or beyond the amount in their account to pay for. Thus, they have to assess each homeowner their portion of the total cost to repair what needs to be done. It can sometimes be charged as a one time payment, but depending on the amount it sometimes is payable gradually over the course of several years making it easier to pay. In this particular incident they gave the homeowners the option to divide the cost over 10 years which many of them opted for. It then becomes a problem if they decide to sell in 3 years and the assessment still has 7 years to go.
In this case all the stucco on the exterior of the units needed to be redone. This is rare instance for this tremendous amount, but most communities at some point end up giving a special assessment for various reasons. Sometimes bad planning, bad accounting, non budgeted items, bad management or just a serious situation that must be corrected.
The responsibility of paying the assessment is on the shoulders of the current owner but can be passed on to a buyer if agreed upon. Any Special Assessment must be disclosed to a buyer prior to going into contract. With all that being said, it could give a condo buyer a great buying opportunity since prices usually drop accordingly.
So if you are considering a condo or townhouse be sure you ask the right questions of management and be sure to work with a condo specialist such as us, we can guide you through the process. Contact Warren Damiano at 973-256-0303 x 204 to start your search.