Have your real estate attorney go thru the condo association documents very closely & explain everything to you. An established association will have the proper amount of money in reserve to take care of maintenance, projects, etc. You'll get copies of past years' balance sheets along with records of repairs made. The best thing is to fully understand the financial portion. Then see if you mesh enough with the other owners. The history of the condo association should tell you of any major problems.

If you are really, really concerned, don't buy a condo in a smaller building. There are lots of bigger condo associations in bigger buildings all over the Boston area.

Good luck!

Excellent question. It will be interesting to read what other readers respond but my general sense is that you're right to be concerned. Especially here in Chicago, there's a myriad of three- or six-flat walkup home to condo conversions nearing a century old throughout the city. The charm of owning home in one of these comes with some big risks, a few of which you pointed out...

1. It isn't unreasonable to request an HOA balance sheet for a condo you consider joining/buying into.

2. Ask to see a copy of the condo agreement documents to make sure measures are in place to deal with problems as they arise.

3. What percentage of units are rented versus owner-inhabited and what percentage of units are foreclosures will affect your home's value.

4. Ask about pending special assessments or lawsuits that you'll be expected to help finance.

5. Don't hesitate to pay $500 to have an independent home inspector inspect the property... It can save you a lot of money and frustration knowing upfront about foundation problems, up-coming roof repairs, the presence of asbestos if you intend to reno, structurally unsound balconies, etc...

6. Don't hesitate to contact the property manager to request a meeting with her/him. You'll quickly get a sense of whether this is someone you'll enjoy working alongside when future problems arise.

This might seem like a lot but it's critical considering the housing market is making residential mobility much more difficult these days. Regardless of whether you go the small condo/ large condo association route, don't forget that short term rentals/ executive rentals are a valid option. Who knows what the market will look like in another 6 months?

Good luck finding your dream home!

Renting forever isn't the worst scenario in the world. If your druthers are not to have these legal entaglements, I would stick to renting. You're much more free and you're not paying money into a condo association. I understand owning a home; I understand renting. I've never understood the whole condo thing -- it's like the worst of both worlds.

We just bought a basement condo in a building much like the one pictured in the post, in DC. We met our above neighbor during our inspection and made sure we got the scoop on the building/other owners. Luckily she said all good things and it has turned out really great. 6 months later we have had multiple stoop wine parties and we routinely help each other out. We lucked out likely, but see if you can meet a couple of the other owners when you get serious about a property.

One note, be sure to consider *who* is living above you if you live in a condo conversion. With no concrete floors separating units, it can get loud above you. Luckily, we have a single girl with no dog above us. She did dog sit a large dog for 2 weeks and we were pulling out our hair. Maddening.

EVerything is s compromise. If only 3-families are availabel in your desired neighborhood, you either have to bit the bullet and take the plunge, or expand your search area to include larger buildings or complexes. I would not want a condo in a 3 unit building -- I feel there's safety in numbers!

Never type before having coffee -- let's try that again after a proofreading:

Everything is a compromise. If only 3-families are available in your desired neighborhood, you either have to bite the bullet and take the plunge, or expand your search area to include larger buildings or complexes. I would not want a condo in a 3 unit building -- I feel there's safety in numbers!

You have already received some good information. After living in a small condo (8 units) this is what I can tell you. There is no guarantee that you will never have bad or crazy neighbors. Ever. No matter where you live. After 5 years my solution is to be present, vocal and firm about doing things in accordance with the law and association by laws. People tend to not pull anything because they know I won't go for it.

You also need to realize that if there are only 3 owners someone needs to do the work. We don't have a manager or management company because of the added expense. Three of us handle the following: bookkeeping including taxes, managing all the maintence including lawn care, snow removal and garbage pick up and then there are all the repairs. Just this summer we added insulation to the attic, replaced one of the balcony decks due to water damange, had a chimney repaired and a water pump replaced. Someone has to make the call and meet the repair people. And then good luck finding good people!

My last bit of advice, don't be friends with your neighbors. Absolutely be friendly but maintain a business relationship.

Just become a member of the Homeowner's Association management team. That way, YOU'RE the one making the decisions (along with 4 or so other team members).

Sorry I have to add a couple of things. Find out about noise, pets and smoking. When I moved into my condo people were masking the smoking odors when selling. Owners then got a nasty surprise. If someone lit up in one condo the smoke spread to most of the rest of the building. With some expense and arguing we banned smoking. You really need to know if the building is smoking or non before you move in and if you are a smoker if it is likely to become nonsmoking. In our state if a majority of officers votes to make the building nonsmoking they can put the amendment through.

I wouldn't do it for a few reasons:

1. Lots of small condo associations in the area don't do a good job budgeting for wear/tear, and therefore either allow the property to decay or hit up owners for assessments regularly.

http://www.boston.com/realestate/news/blogs/renow/2010/11/small_condo_ass.html

2. It is very difficult to sell a condo if a building is not mainly owner occupied. Many mortgage underwriters will not give a buyer a mortgage to buy your condo if to many other units in your building are being rented out. For example, for FHA backed loans, the association must be at least 50% owner occupied. It is not uncommon to find associations these days with so many rentals that it is tough for anyone (other than a cash buyer) to buy a unit, and therefore tough for people to sell. You can be more 'stuck' with ownership in a small condo association that you would like to be.

In many cities, the HOA is required by law to provide a copy of the condo docs prior to closing on the unit. Decent condo docs will include the balance sheet, bylaws of the condo, etc.

Remember as an owner, you have as much right to well-being in the building as anyone else. If you don't like what the HOA board is doing, then become a member of the board yourself. If you think your neighbors above you are being too loud or if the floors are very thin, lobby for a bylaw in the condo rules that a certain percentage of the floors must be covered with carpet, and that fines will be instituted for noisy neighbors.

You have a lot more power in this situation than you think. Don't let the prospect of living with your neighbors scare you away from owning your first dream home.

I had a condo in a 3 family home in JP from 2002-2004. I talked to the neighbors before I moved in, reviewed docs carefully, got a record of the budget (showing expenses and reserve fund) and felt comfortable with the situation.

As someone else advised, I did become a member of the association so that I could have a vote in all condo activity. About 6 months after I moved in, the owner that had been handling the finances sold and I took over that as well. As a consequence, everyone treated me like the building manager which meant if anything got done, I had to do it or initiate it.

In general, I wouldn't say I had a bad experience. However, I bought a condo so that I wouldn't have full responsibility over home maintenance. In the end, I not only managed my homes interior, but the rest of the building as well. At least it was a good lession\preparation in home ownership! I now live in a single family home.

I know lots of folks that have gone into these situations - mostly good stories\experiences with only some negatives thrown in.

Good luck!

HOA are great, in theory, but if you move into a larger community with about 20 members, expect the costs to rise every year. Sure, it's cost of living but our HOA went from under $200 per month to $300 a month in over 3 years. We couldn't afford it anymore.

I've owned a condo in a 3-unit triple decker for a little over a year now. Definitely have your real estate attorney review the condo docs, and make sure you get a copy of the associations balance sheet. If I'm not mistaken, this all has to be provided to your mortgage company anyways. What you'll want to see is a decent amount of money in savings for future maintenance. If the condo assoc fee is really low, that may sound like a good thing, but really it means little money is being saved. Also, the smaller the number of units, the bigger your share of any repairs/maintenance will be.

In any case, it's probably better if the units are owner-occupied so that you get easier mortgage approval and also so that you don't have to deal with renting neighbors + the owner.

We were strongly advised against this by multiple friends who lived in small associations and by real estate lawyers. That's why we ended up in a very large association in Brookline with a board and a management company. So glad we took the advise now being on the other side.

I managed a huge condo complex in downtown Boston and the condo association meeting were nightmares with no consensus at all. In Brookline I have owned in a 12 unit building and a 2 unit home. The smaller experiences have been the better ones - because you KNOW your neighbors. It's easy to be an ass when you don't know your neighbors, their lives, their kids, but much more of a motivator to get along when you bump into each other every day.

When we bought in our current 2 unit home, the other homeowners were very wise and asked to meet with us before the closing to make sure that it was a good fit for everyone (a very sweet breakfast at their home). It was not anything legally binding, but very smart for all concerned. Now that they are selling, we plan on doing the same thing with their buyer. Being up front about smoking, music, kids, cooking odors, pets, cars, etc saves everyone huge headaches down the road.

These small condos are everywhere in the Boston/Brookline/Cambridge area and true nightmares are few and far between. As long as you have a good attorney and real study the docs and regs, and meet the potential new neighbors - you should be fine. Good luck!

PS - Bigger buildings can have HUGE assessments when it comes to repointing, repaving, window replacements, roof repairs, etc.

Any HOA is going to have it's advantages & disadvantages. The bigger the HOA, the more money it's going to cost you. The smaller, the better financially but you will have to get more involved.

I recently bought a condo/townhouse in San Diego with a small HOA (10 units; HOA has P and VP). When I looked at the unit for the first time the next door neighbor/HOA VP came in and started chatting with me. I knew I didn't like her from the first moment I met her. I've been lucky and have always had great neighbors in my previous rentals. If I would have understood how much a neighbor can make your life miserable I would have never bought a place in the building. She is a typical nosey neighbor who is constantly calling the police over NOTHING (not on me thankfully, not yet anyway). And of course she is on the HOA...she's a total psycho. She is currently suing another neighbor over a personal vendetta and having the HOA pick up the tab. So I guess the point is....meet all of the people in the HOA, trust your instinct.

Another idea - when you get the condo docs to go over also request minutes from some of the past
meetings, this will give you an idea of how the owners work together and how the building is run.

Oh, I have been there, and I would not go back. But, in Boston it's kind of common to have to start in a 3 family....so, just be very wary and very prepared.

Check the paperwork and be very careful about the reserves. Some small associations have none and when something needs to get fixed you have to get everyone to agree to pay up. Not easy. Someone is always broke. Check the documents to see what your recourse is if someone does not pay their dues, too. It happens all the time.

Also, check the regulations and recourse on renters, extra tenants and pets. Be sure they are iron clad and that your rights trump any renter or pet with minimal fuss (send a letter and 30 days to solve problem, etc.)

Be prepared to do ALL the maintenance and all the bill paying. Maybe you will get lucky and have helpful neighbors, but assume the worst. Ask the actual neighbors about who does the bills, who shovels the walk, who brings out the trash bins, paints the common hall...if they are vague, then you know.

But, all that planning will not save you from the crazies. We went from a 3 fam with a terrible renter above (dog pooped in the hall regularly) and a depressed divorcee below. No one had money for needed repairs so we sold and left. Moved to a 2 family with a CRAZY lady below. Had to leave just to rid ourselves of her drama (broke, faking terminal illness several times, legal drama, used our basement space as her own, never did a lick of common yardwork, stored junk on her patio next to our front door, asked me to shovel the snow 3 weeks post c-section since she was "busy"). Had to love it when she called me after we sold to ask me, "Didn't you tell them what they had to do????" Hahaha, yep, I handed them the financial folder and headed out the door. College kids renting it from the new owner are not likely to be tending to her they way I did. They apparently even lost the folder when moving in! ;P

Ahhh, single family living...I will never do a small association again, but they were necessary steps.

Hello, this is Caitlin (asker of the above question.) Wow, lots of good advice and information here. I appreciate the cautionary tales as well as the practical and legal advice. Oh, and the writer who mentioned that FHA loans don't apply to renter-occupied buildings - that was VERY useful information. Part of the allure of a condo was that we wanted to be able to rent it out when we traveled, but it sounds like a liberal renting policy would be a bad idea. Sounds like we'll need to sit down with a good real estate lawyer and lay down a game plan...maybe we should hold out in hopes of finding a very small single family, an elusive beast along the Red Line. Thanks to everyone for the advice!

I have lived in 2 two-family condo associations. My first experience was great. We got along well with out neighbor, and when she sold we got along great with the new neighbor as well.

Unfortunately, we moved to a new two-family condo association in Cambridge feeling confident we could work with anyone. Our fellow owner is a lunatic. She leaves us angry letters constantly, can't pay her condo fee, threatens to spend the condo money on her own, and has antagonized everyone on our street. Since it is a two-family association, we can't make decisions on anything without both parties agreeing.

So I recommend particular caution with two family situations. Also remember that meeting your neighbors is a good idea, but they can sell and move at any time.

I agree with eiw that renting forever is not a bad idea. My husband and I can afford to buy but we chose to rent instead for the very concerns you have.

In our last apt we were the only renters in a 6 unit vintage condo building. If was fascinating and horrifying to be on the outside peering into a condo association - they discussed their meetings with us and we saw the meeting notes posted even though we were not present at them. We lived with the horribly poor decisions they made.

We were able to see how the tides changed when two units were sold around the same time and owners with smaller budgets and different upkeep values moved in. We saw the building become neglected - back decks installed not up to code for a super cheap price, that were super dangerous. Leaks, gutter, and drainage problems "fixed" on the cheap that lead to tens of thousands of dollars of more severe problems. Meanwhile, they splurged for Japanese maples, high end landscaping, and Christmas decor from the most expensive gardening stores in the city.

As poor decision making by the association took over, the value of the units went down. I work at home and could hear potential buyers scouring the building with agents and inspectors, my jaw dropping as the inspectors pointed out shoddy work left and right. Deal after deal fell through on the condos on the market in that building.

That apartment was the first apartment that my husband and I lived in together. The original plan was to buy a unit in the building. Then we decided to not only move out as renters but take this as a lesson and not own at all. Instead we rent a gorgeous unit in a six-flat two blocks away. The apartment is vintage and condo quality. We have a great landlord who maintains it well - saving us time and money. We don't have meetings to go to nor business relationships to maintain with our neighbors. It is heaven. But should anything change, we know we can move at the drop of a hat.

Larger buildings and associations have their drawbacks as well. In our 40-unit building, it took more than 3 years to get a necessary tuckpointing project underway because the resident/owners who didn't want to pay the special assessment kept digging up dirt on every contractor who submitted a bid. Unfortunately, the bids got higher and higher with each passing year and, ultimately, we paid a lot more than we had to.

I think you have good cause for worry. I have a friend who lives in a tripledecker in the Boston area. One of the unit owners has emotional and alcohol abuse issues which has led to all sorts of problems in the management of the association. Basically, when you buy into an association this small, it's like family --- you can't help being sucked into the drama, no matter how much you would like to remain out of it. And even if the current unit owners seem sane enough, it doesn't guarantee that whoever they end up selling to will be. So I would proceed with great caution.

I think you've gotten some excellent advice so far.

It's very important that you do two things:
1. Contact the Property Manager and ask him or her about repairs or upgrades that have been done to the property within the last five years. I'd be looking for expensive things like a new roof, driveway, siding, etc. Then ask that person about any assessments coming up in the near future. Will the roof need to be replaced very soon? Will the driveway need resurfacing in the very near future? With such a small pool of homeowners these assessments will be very costly. A good Realtor should already have done this homework for you.
2. Obtain and commit to memory the HOA rules. Again, your Realtor should already have obtained a hard copy of it for you, but make sure you get them and know what improvements are allowed to your property and which are forbidden.

Basically, you don't want any surprises after you close.

I've now lived in two condos with 4 units or fewer. A couple of observations:

1. I agree that your best move may be to treat your neighbors with respect and be cordial, but above all, as business associates. This will make it a lot easier to be firm and assertive when tough conversations or tough decisions must be made. In our last condo, indoor and outdoor chores rotated around the building. One unit NEVER did their chores. Was it a big deal? Not really, but when everyone else has to clean up after the people who aren't doing their fair share, it gets old. Fast. But we were all so friendly with each other, nobody wanted to call them on it.

2. Before you buy, make sure that all the people in the building are paying their HOA fees in a timely manner each month. This is something you should be able to figure out by reading the docs provided by the building.

3. Remember that the current owners are as nervous about you as you are about them. We had two units change over while we lived in our last building, and I'd say we were really lucky (even with the couple who didn't do their fair share of the work around the house).

4. Make sure you are clear on what is common (and therefore a shared responsibility) and what is not. This will save a lot of headaches later. (We had to figure this one out on the fly when one unit was offered for sale with "exclusive" use of a common porch. After a lot of wrangling and uncomfortable e-mails, the ads were changed.)

Thankfully, I just sold my condo, which was in a large association, in the Boston area. I can say with complete conviction that I will never buy a condo again.

Although the 80-plus unit association is professionally managed, it is run like a third-world dictatorship. Monthly trustee meetings are held in secret (I kid you not) and unit owners interested in running for the board but who are not "approved" by the inner circle of idiots never get elected. All decisions are made behind closed doors by a board of 5 trustees. There's no opportunity for discussion and virtually no communication between the trustees and the rest of the condo owners.

When I bought my condo 9 years ago, the management company was great and condo fees were less than $300 a month. Unfortunately, two of the regulars on the board of trustees were so nasty to the management company, that it refused to work with the association. When the new management co. came on board, it started raising fees, and now condo fees are more than $400 a month.

If given the choice between a small association and a large one, I most likely would go small, because at least there would be the chance to have input into where your money will be going.

Caitlin - if your building if not FHA approved and none of the owners need or want it to be, then renting your unit out is obviously not an issue (although it could affect resale value for potential buyers regardless of their loan status, because some buyers want to live with other owners, not renters). Having a building FHA approved, especially in this economy, can be a good thing for attracting buyers. But due to the various restrictions on FHA approval, it may not be worth it to try to get a very small building FHA approved.

The more people who own units, the more people will share the expenses if something major goes wrong with the building. Unless you are financially fairly well off, I would strongly advise against buying into a small building. It's amazing the power a condo association can have over finances which will have a direct impact on you. Members of a condo association change and with that the philosophy of how the building will be maintained will also change which will have a direct impact on whether or not things are fixed, fixed properly, upgraded beyond what you'd prefer to pay, etc. Even with a very thorough and professional inspection of your unit and the building, issues can be missed which will cost money, time and aggravation down the line. The more owners who actually live in their units as opposed to renting them out, the better. Also, make sure you have the best insurance coverage you can find.

I suppose I'm lucky after reading these posts. I bought my first place in Cambridge 2 1/2 years ago. It's a two building, 5 unit association and things have been fine. I think we're all fairly reasonable, responsible people and we've been able to work out any disputes with open communication. We share responsibilities. One woman does the dues collecting/banking, I keep track of our modest "reserve" fund for each building (not much, but enough to pay for the issues that have come up to-date.) One condo owner is handy and underemployed, so he does a lot of the maintenance which we pay him for out of our reserves. Another neighbor has volunteered to take the trash out each week.

I wouldn't say don't do it but just be careful and do your homework. Find out as much you can about the other owners (majority owner occupied definitely way to go.) I looked up the existing owners via property search and then googled them - it's amazing what you can find out.

I know finding a single family in the city is not viable for most first time homebuyers. But now is the time to get into the market. See how it goes. If in a couple years, you're hating it, sell. The market has got to start getting better within a few years I would think.)

Good luck.

Tread carefully and do your research. I know of at least one three unit dysfunctional association. Two out of the three owners are involved in a multi-year feud with a ton of crazy on both sides. The third owner lives elsewhere and rents out his unit and tries to avoid the other two.

That said, anyone doing basic research would become quickly aware of the dysfunction (it includes lawsuits and counter-suits), so just do your research and listen to your gut.

After what I've heard recently about HOAs, I would NEVER even consider purchasing a home involved. If you're considering it, you definitely need to get a lawyer involved to ensure that the HOA cannot just seize your home if you fall behind on your dues.

I've been a buyers agent selling and living in Boston Condos for the last 8 years. There really is no answer that you want to hear. It makes very little difference whether you buy or rent, living in the same building with others is a potential house of pain. Small homeowners associations are worse I think. I've always picked the 3 to 5 owner buildings because in Boston those small townhouses built in the 1880s are my favorite. Feuds always pop up whether you own the unit or are renting. I've got some horror stories. Of course if you own a detached single with a small yard you are better off but you can still have problems with neighbors. Living with people is not easy!
Good Luck,
Jeff Persons ABR http://wesellboston.net/