Condo Purchasing info

As far as common area repairs, I would think the association dues that you pay and the HOA will cover the cost.  But I'd look into the HOA's finances thoroughly to make sure they are solvent and have enough in reserves.  We bought a condo here in Illinois and have discovered all sorts of problems with the HOA last year when it was turned over to the homeowners from the builder who went bankrupt.

I don't think it would be a conflict of interest to work with either of the realtors and if you've found that a lot of homes are going for 20% less than listing price, I wouldn't hesitate to offer that much less.  Just be certain that this area is where you want to be.  Best of luck!

zguillory wrote:

Hey Guys,

So my husband and I just moved here last week from Brooklyn.  In the process of looking at rentals our real estate agent also showed us a condo that is on the market.  Our Real Estate company is one of the oldest on the island so we feel like they are trustworthy.  We would be paying cash so we don't have to worry about the loan process and we would be getting a lawyer and an inspection (though we know it isn't common here).  We know what the condo appraised for because the house was under contract but the buyer couldn't come up with the full 20% down payment.  The condo is in Condado.  We have a few questions though before we put in an offer. 

Is there a percentage under asking that becomes insulting?  We noticed that lots of properties that have sold in the Condado area in the last year have gone for 20% below asking so we were thinking of low balling since its a cash offer.  Would that seem like we are assholes (predatory mainlanders) or is that normal?

How are common area repairs generally decided upon and paid for in a condo building?

Does anyone have a good lawyer?

Are there other weird things to consider when putting in an offer?  Questions we should be asking?

Also we have been using one agent for our rentals but it was her boss that told us about the property and they both showed it to us.  The boss is the sellers agent.  Should our original agent be involved or should we just work with her boss? We worry that either way there is a conflict of interest and we should handle the negotiations ourselves.

Thanks in advance for any and all advice.

-Zalika

Take a look at the property, see what it is worth to you! I would say that and offer for 80% to 85% of the asking is not bad, you have to look up for your finances and not theirs. If they are insulted, then that is too bad, they can take it, make a counter offer or wait for the next person to make an offer. Economy is bad, people are loosing their jobs, they rather take a low offer and make some money than loose the property and everything they have invested to the bank.

Condos like in the state have a condo association, they decide how much condo fees they will charge and what gets fixed first. I don't like condos as I do not like others making decisions for me or telling me what color curtains I need to have. Also I do not like to live in a condo/apartment sharing walls and ceilings with others, I like peace and quiet, so I go for a home instead. But you are probably used to that so a Condo may be the way to go for you.

Be wary of condo fees, if you can, talk to some of the people living there and see how the condo fees have raised over the years, how happy they are with the security of the area, how happy they are with the condo association. Drive around, see where hospitals, supermarkets, pharmacies, etc are. See if you have any problems getting by the guard by just saying you are visiting a friend. Ask the people living there about breaking in situations and damage to cars. A gate that is climbed is almost as good as an open gate.

Paying cash ussuealy means that the deal is a done deal as you do not need to qualify for a loan. So it should go faster for seller and buyer. Get a lawyer, have them check the title of the property before you make an offer, get a house inspection, it will cost around 350 or so, get an appraisal to make sure you are not over paying. If all is well make an offer and if accepted, put down 5% of the value and make the offer contingent on the appraisal, inspection and title being clear. If not on paper and signed, it is not worth anything, don't lose your offer assurance money because you want to blackout of the deal due to something not in the offer contract.

I have a lawyer, and a realtor for you if you want it.
Good Luck

Schuttzie wrote:

As far as common area repairs, I would think the association dues that you pay and the HOA will cover the cost.  But I'd look into the HOA's finances thoroughly to make sure they are solvent and have enough in reserves.  We bought a condo here in Illinois and have discovered all sorts of problems with the HOA last year when it was turned over to the homeowners from the builder who went bankrupt.

I don't think it would be a conflict of interest to work with either of the realtors and if you've found that a lot of homes are going for 20% less than listing price, I wouldn't hesitate to offer that much less.  Just be certain that this area is where you want to be.  Best of luck!

The condo fees are only $100 a month and there are only 8 units so I feel that money only covers the maintenance guy's salary.  I will get more info on what the building's bank account is like.


Thanks,
Zalika

ReyP wrote:

Take a look at the property, see what it is worth to you! I would say that and offer for 80% to 85% of the asking is not bad, you have to look up for your finances and not theirs. If they are insulted, then that is too bad, they can take it, make a counter offer or wait for the next person to make an offer. Economy is bad, people are loosing their jobs, they rather take a low offer and make some money than loose the property and everything they have invested to the bank.

Condos like in the state have a condo association, they decide how much condo fees they will charge and what gets fixed first. I don't like condos as I do not like others making decisions for me or telling me what color curtains I need to have. Also I do not like to live in a condo/apartment sharing walls and ceilings with others, I like peace and quiet, so I go for a home instead. But you are probably used to that so a Condo may be the way to go for you.

Be wary of condo fees, if you can, talk to some of the people living there and see how the condo fees have raised over the years, how happy they are with the security of the area, how happy they are with the condo association. Drive around, see where hospitals, supermarkets, pharmacies, etc are. See if you have any problems getting by the guard by just saying you are visiting a friend. Ask the people living there about breaking in situations and damage to cars. A gate that is climbed is almost as good as an open gate.

Paying cash ussuealy means that the deal is a done deal as you do not need to qualify for a loan. So it should go faster for seller and buyer. Get a lawyer, have them check the title of the property before you make an offer, get a house inspection, it will cost around 350 or so, get an appraisal to make sure you are not over paying. If all is well make an offer and if accepted, put down 5% of the value and make the offer contingent on the appraisal, inspection and title being clear. If not on paper and signed, it is not worth anything, don't lose your offer assurance money because you want to blackout of the deal due to something not in the offer contract.

I have a lawyer, and a realtor for you if you want it.
Good Luck

I will ask about crime and break ins as the apt is a small building that doesn't have a full time guard.  We were told the appraisal value by the agent but we can ask for a new one as well. 

we are used to noise cause we are city people but it is a quiet street the stairs separate the units and we would be on the top floor. 

I will most certainly get everything in writing and get an inspection/appraisal/etc 


Thank you!

Hey Zalika,
Welcome and congrats in your new ambitious journey!!  All the responses from the expat are 100% on point.  All I will add is that ,don't be pressured or rushed into property purchasing.  With cash on hand you're in a Win Win position, especially on this unfortunate financial crisis for the island.  But consider shopping for a home rather a condo.  For the price difference you can have more freedom to upgrade or sell if need be. Rent short term if you feel tugged in your decisions.  Time is your best friend and you'll make good choices..  As far as I can imagine you and your husband are positive ambitious doers for starting fresh to a tumultuous new place.  Follow your instincts and common sense and I see success in your business and property search and everything else you set your mind on.  Lots in PR to choose and pick and look at nearby areas closest to Condado that will meet your needs.. Good Luck!!

The condos are all governed differently.  I own one in Arroyo and the homeowners association is very low-key.  I am personally responsible for repairs for my roof, exterior painting, my plumbing, etc.  It is a charming neighborhood and the neighbors are wonderful. There was one person who was having financial difficulties and had not paid her common charges.  They waited more than fifteen years to invoke legal action.
Here in Palmas del Mar there are more rules and regulations, an architectural review board, etc.  But there is a higher level of services----there is someone to call if you need assistance. The price of the condo was not negotiable. I purchased it directly from the builder.
So, my advice is to dig a little more.

All responses, I agree with.  All Home Owners Associations (HOA) are different.  We currently have an owner that is way behind in dues and are discussing what our options are.  Certainly doing some investigating on the neighborhood and other unit owners.

Since the building is basically open, stop by and talk to the other people in the condo complex. Also stop by around 8 pm and check the area for safety and who is hanging around, park and watch.
Don't go for the first place you find, look around, maybe even consider a house. The market is slow so you do not need to hurry. You may also want to consider just renting to get the feel of the island and hold your money to purchase later when you are sure. Mean time while renting look around for the house or condo of your dreams in the part of the island that you like the most.

I agree, Rey

zguillory wrote:

We were told the appraisal value by the agent but we can ask for a new one as well.

I would be wary of the appraisal value from a realtor. It may or may not be correct and besides appraisals are based on the value payed by others for a similar place in the last 90 days to 6 months. As  the market is deteriorating, and since we do not know for sure how old the appraisal is, it is hard to say if it should be trusted.

Get a new appraisal and not from the guy recommended by the Realtor Agent. Most agents work for the seller.

One item of caution ..... Due to economic conditions and the GLUT of properties available in the market, it is highly possible that any property you buy today, will be worth less 3-5 years from now. So make sure to get the best deal possible today and make sure you plan to stay there for more than 5 years, you would loose money if you sell too early due to the economic situation in the island.
Good Luck
Rey

We are planning on getting another appraisal but the real estate agent was told it a few weeks ago.  The property has not been on the market very long (only since April).  The real estate company we are working with hold the #2 license on the island so there is a lot of history behind him.  As people who came from highly inflated Brooklyn we understand that property can devalue a lot. At the price we would be buying at and given that it is in the heart of Condado and less than 5 blocks from the beach/Ventana Al Mar/high end shops and many hotels if we decide not to live there in a few years it would become a vacation rental or second home for our families.  Thankfully we have a friend who is from here and owns a condo that is close to our who just recommended a good lawyer and buyer agent for us to make sure everything is good.  Having only lived in big cities we are very cautious about who to trust and ask many many questions. 

Thanks,
Zalika