Real estate can seem like a tough nut to crack in terms of understanding its trends and how it works. Some years, like in 2011, there is more growth in urban areas than suburban areas (which hadn’t happened in over a century). And other years, for instance, more people choose to rent an apartment than invest in purchasing a home.
Another option many people are flocking to, especially retirees, is condominiums, or condos. Condos are unique in that they’re like a mix of a home and an apartment, sharing aspects of both kind of property. A condominium is a large building or complex of residential buildings that are individually owned. What’s left of the condo complex is collectively owned by those living there. Owning a condo isn’t all that different from owning a home, except most condos are cheaper than homes, and they don’t require as much maintenance that you have to do yourself.
If you’re thinking about moving into a condominium complex, it’s good to have a basic understanding of how they operate. The way condos are run and maintained differs from the way apartments and homes are operated.
What Do Condo Management Companies Do?
Condominiums are operated and maintained by condo management companies. As previously stated, a resident individually owns their property within a condo complex, but the complex itself is collectively owned. Because of this and the typically large size of condo complexes, maintenance cannot be relegated to the individual residents, but is rather taken care of by a condo property management company. So if a condo complex features large lawns, a pool, and/or fitness center, these are cleaned and maintained by a company designated to do so.
Condo management companies are chosen by the board of directors who oversee the condo complex. In other words, the board of directors might not directly take care of all the operations necessary to keep the condos up and running, but rather hire companies or contractors to handle some of the work. And maintaining condos involves more than just cutting the grass.
Some of the tasks necessary to properly manage condos are keeping the property up to date with environmental regulations, contacting residents about violations (such as Covenants, Conditions and Restrictions, which are set forth by the board of directors), and managing finances. A major difference between the board of directors and management company is that the former creates and approves the rules and regulations of the complex whereas the latter must simply enforce it and report back to the board of directors.
Real estate isn’t static for long, since trends change and people move around according to various circumstances. But regardless of whether or not you understand how the real estate industry works, it’s at least helpful to have some rudimentary knowledge of how different kinds of real estate operate. With this information, perhaps you now have a better idea of how condo complexes operate, and whether or not this type of housing is right for you.