Condo blues

[ivinsfan]

The owners on the ground floor don't think the building needs a decent roof.. LMAO and this is why I would only buy into a condo development if absolutely necessary.

[pb4uski]

One of the things that drives me nuts about our Association is that the Board doesn't fully fund reserves. Full funding is the default under Florida law but and Association can fund less if approved by a majority of the members. Our Board could chose to not offer less than full funding since it is the default option.

They know that in ~5 years they will need to replace the roofs and that they wont have enough money and that a special assessment will be needed... but t keep saying that they can't increase HOA fees because people can't "afford it"... well, if they can't afford an additional $60/month now how will they afford the $3,600 special assessment in 5 years?

I think that the Treasurer prefers it that way so she can keep her money "invested" since the reserve funds only earn about 1.5% or so.

[Texas Proud]

Quote:

Originally Posted by KimL So far, HOA increased 15% for 2017, 13% for 2018 and I've heard 10% for 2019. No info from association (I was overseas last year and working so no contact with board) but the other owner I talked to the other day told me that the spalling repairs (that I was told had been all taken care of before I purchased) were done with a loan (inadequate reserves) and now we're paying for it.

I will keep reading, but one thing to remember is that there is no increase without the vote of the owners...


Probably when the repair was needed it was voted to go with a loan instead of a special assessment as that means anybody who sells passes along the costs to the new owner... that is what happened in my mom's condo... they took out a 10 year loan and now have a special assessment of $59 a month more just for the repairs...


However, the repairs are needed as it is a 19 story building that has had flooding in the lowest level parking garage a few times...


As for you question... how much in real dollars are you talking about? And how much lower will you have to sell?


If you wanted to live there for 3 years then do so... in the end the price will probably go up enough to cover the extra costs.... or close enough that you would not care...

[bloom2708]

How much will the HOA fees be compared to the expenses of selling low and paying the realtor fees?

Are we talking $1,000 per year, $2,000 per year? More?

Getting below market and paying the realtor fees would be reasons to stay put.

[SheitlQueen]

Quote:

Originally Posted by Luvdogs I'm on the Board of Directors for a condo rental I have. Just got on the board several months ago. I've owned the place for about five years and the increases have been very small--but we have no money in reserves! I mean last year they increased them by $5.00 per month!! Really--so what is that going to do?? We have a 30 year old roof that needs replacing. Condo has spent 25K in the past couple of years for repairs of leaks. Now we want to add a special assessment of 5-7K each for new roofs (small 40-unit complex). The dogfight begins--some want nicer roof/some the cheapest/some want to bury their head in the sand and say "h*ll no." (especially the owners on the ground floor). As for regular condo fees--ours has a cap of 15% per year without member approval. I don't know if that is a state law or a condo rule but if I have it my way it's going up 15% per year for a few years to get some $ in reserves--and that's in addition to the special assessment. For our condo, we cannot commingle the regular fees and the special assessment. Your fees may have been exceptionally low and they may be bringing them up to current levels--or like us--no one cared/paid attention and we don't have the $ for a major repair.

Your situation sound exactly like mine. Which is why the fees just went up 40%, with the approval of the owners. Keeping fees cheap and putting nothing to little into reserves is a mistake and means big assessments whenever major repairs are needed.

[gcgang]

I've heard RE in Honolulu has been on an upswing for 8+ years. Probably not going to get a lot better.

If you're going to move anyways, you should be ok. I'd assume you could buy a comparable unit for 1/4-1/2 the price most places on the mainland.

[Freedom56]

My advice would be for you to get more involved with you condo board meetings and look over your financial reports. We revolted against our treasurer at our condo in Florida for wasteful spending and voted him out. He redecorated our two lobbies at a cost of $657K. It was previously re-decorated in 2012. He wasted absurd amounts of money such as, $12,000 on a grand piano for the main lobby that nobody plays. On top of that he was paying the store that sold it to our condo, $2000 per year for "tuning and maintenance" and it's a digital grand. He also spent $7000 per month for free coffee for all residents. He spent $3000 per month on lawn maintenance. The only lawn we have is artificial grass which we paid a fortune to install to reduce lawn maintenance costs. Many of us suspected that he was getting kickbacks. He left his position and the building. Our monthly fees dropped by 8.8% after we got rid of this loser.

[Texas Proud]

Quote:

Originally Posted by Freedom56 My advice would be for you to get more involved with you condo board meetings and look over your financial reports. We revolted against our treasurer at our condo in Florida for wasteful spending and voted him out. He redecorated our two lobbies at a cost of $657K. It was previously re-decorated in 2012. He wasted absurd amounts of money such as, $12,000 on a grand piano for the main lobby that nobody plays. On top of that he was paying the store that sold it to our condo, $2000 per year for "tuning and maintenance" and it's a digital grand. He also spent $7000 per month for free coffee for all residents. He spent $3000 per month on lawn maintenance. The only lawn we have is artificial grass which we paid a fortune to install to reduce lawn maintenance costs. Many of us suspected that he was getting kickbacks. He left his position and the building. Our monthly fees dropped by 8.8% after we got rid of this loser.

In my old neighborhood our annual assessment fees went way up... found out the president had signed contracts with HIS company... no kickbacks needed...


When someone found out about this there was a push to get him out at the next meeting... he kept delaying it over and over until someone forced the issue... so he held it at a place many miles away!! A bunch of people went anyhow and just before the vote he closed the meeting on some technicality.... took another couple of months to get him out...


It is important that people look at what is happening and not just ignore it... that can cost you money...

[audreyh1]

Quote:

Originally Posted by Texas Proud In my old neighborhood our annual assessment fees went way up... found out the president had signed contracts with HIS company... no kickbacks needed... When someone found out about this there was a push to get him out at the next meeting... he kept delaying it over and over until someone forced the issue... so he held it at a place many miles away!! A bunch of people went anyhow and just before the vote he closed the meeting on some technicality.... took another couple of months to get him out... It is important that people look at what is happening and not just ignore it... that can cost you money...

Wow. Unbelievable! He really though he could get away with it.

[pb4uski]

Quote:

Originally Posted by Freedom56 ..... He also spent $7000 per month for free coffee for all residents. ...

How is that even possible?

[jollystomper]

Quote:

Originally Posted by pb4uski How is that even possible?

Kickbacks.

[Scrapr]

Quote:

Originally Posted by pb4uski How is that even possible?

McDonalds $1 coffee delivered by Uber Eats. The tip really gets ya

[Freedom56]

Quote:

Originally Posted by pb4uski How is that even possible?

He subcontracted to a coffee service that rented the machine to our building along with a person who would come everyday to refill with fresh coffee, milk, sugar, and other ingredients. This machine made all the varieties of coffee you can imagine. But it was not worth spending $7000 per month or about $33 per month for every unit owner. Most owners spend about 1-2 months per year at their condo so they really did not benefit. This was one of the first contracts we cancelled after booting the guy out.

[RobbieB]

Hehe, yeah every owner should have hiked down to the office and had a cup a joe every day. Get his dollars worth.

Amazing.

[ivinsfan]

Quote:

Originally Posted by Freedom56 He subcontracted to a coffee service that rented the machine to our building along with a person who would come everyday to refill with fresh coffee, milk, sugar, and other ingredients. This machine made all the varieties of coffee you can imagine. But it was not worth spending $7000 per month or about $33 per month for every unit owner. Most owners spend about 1-2 months per year at their condo so they really did not benefit. This was one of the first contracts we cancelled after booting the guy out.

Like the "free" coffee machine at a lot of car dealers?, that's not even good coffee....

[Freedom56]

Quote:

Originally Posted by ivinsfan Like the "free" coffee machine at a lot of car dealers?, that's not even good coffee....

No this one was a nice machine. It made good coffee, espresso, latte, cappuccino, hot chocolate, and other beverages. It held 4 different varieties of coffee beans. It just did not make sense to give out free coffee. There were people clearly abusing it. As unit owners, we had a problem paying all that money for it.

[ivinsfan]

Quote:

Originally Posted by Freedom56 No this one was a nice machine. It made good coffee, espresso, latte, cappuccino, hot chocolate, and other beverages. It held 4 different varieties of coffee beans. It just did not make sense to give out free coffee. There were people clearly abusing it. As unit owners, we had a problem paying all that money for it.

And of course it wasn't really free was it?

[Freedom56]

Quote:

Originally Posted by ivinsfan And of course it wasn't really free was it?

If you were renting a unit, like the majority of the residents, it was free. Only 18% of the units are owner occupied. Many snowbirds bought their units as investment property and chose to rent it out. We have a majority owner who rents out his units. He was a big proponent of eliminating wasteful spending to reduce his operating expenses.

[ivinsfan]

Quote:

Originally Posted by Freedom56 If you were renting a unit, like the majority of the residents, it was free. Only 18% of the units are owner occupied. Many snowbirds bought their units as investment property and chose to rent it out. We have a majority owner who rents out his units. He was a big proponent of eliminating wasteful spending to reduce his operating expenses.

This is getting to be more of a problem. I know an area that has done 2 huge developments with more planned that pitched entirely and zoned for short term rentals. But the devil is in the details and the HOA are pretty substantial and the owners must use managements rental agents who take 1/3 of the rent money right off the top.

[fasteddie911]

Not sure what kind of building you're in, what your HOA fees were/are and what your plans were for moving to Hawaii. But it's not uncommon to see HOA fees in the 1k/month range. A lot of buildings are old, outdated and need work. Construction and materials are expensive in the islands. The issue with selling is that there's been a huge influx of condos (mostly high end though) that possibly has affected the market. Hard to say if you're panicking, depends on your numbers, but your concern is justified. This is just a reflection of one of many realities of living in Hawaii. Great place to visit, but different from living.