HOA dues cover the expenses for the common areas of the development.  They pay the exterior maintenance, the landscaping, the snow plowing, the shuttle bus, the heating of the pool in the winter, and hopefully they put money into a reserve account to pay the big-ticket items when they come due.  Some of the dues go toward common utilities like cable, trash, water, and occasionally heat.

When Steamboat condo owners fall behind on their HOA dues, here are some of the things that can happen:

• Services can be suspended or stopped.  For example, pools may close during the shoulder seasons, or hot tubs can be closed to make up for budget shortfalls.
• Owners can be assessed to make up for shortfalls.
• Lenders can refuse to lend money in Steamboat Springs condo complexes with a high (15% or more) delinquency rate.

Cutting the budget can get an HOA back into the black until condos are sold and the new owners take over paying the association dues.

And buyers who pay cash or get financing from outside sources (like an equity loan on a primary home) can get some great values.

In summary, when you purchase a Steamboat Springs condo or townhome, make sure you read the CC&Rs, budgets and minutes closely to make sure the Association is strong, or at least managing the budget by cutting costs until new owners take over from delinquent sellers.

Interested in buying a Steamboat condo or townhome?  Call 970-846-8284, or contact us.

The post Steamboat Condo Buyers—Know the HOA before you Buy appeared first on Steamboat Ski Condos.

When you buy a home or a condo in Steamboat Springs, Colorado, chances are you will be part of a Home Owners Association. All HOAs have written rules which are enforced to varying degrees. Before you purchase Steamboat real estate, read the HOA documents carefully.   If you find items you can’t live with, you can back out of the agreement before the deadline specified in the contract.

Here are some of the biggies to look out for in HOA documents in Steamboat Springs:

• Pets. Some condo and townhome complexes don’t allow pets at all. Most only allow owners, but not renters, to have them, which is a great reason to buy a place.    Owning a Steamboat condo allows you to bring your pets with you to Steamboat.  Renting means leaving them in a kennel.   If you have a dog…or two…make sure the place you plan on moving welcomes your canine roommates.
• RV and boat parking. Don’t assume that you can park your boat or RV on your property. It is likely that storing your toys is a no-no, and you’ll have to find another place to put all your stuff.
• Painting your townhome. Look at the colors in the neighborhood. There is a good chance you will need to get approval first and you’ll be required to use one of a list of colors if you decide to repaint. In duplexes, you may have to get your neighbor’s approval to change the paint color or add a hot tub or deck. Make sure you read the party wall agreement.
• Prepaid dues for Reserves. Many condo and townhome complexes (especially newer ones) require that 3 months dues be paid at closing into a Reserves account for the HOA. You may or may not get this money back when you sell the property. Again, read the HOA documents and make sure that you understand whether this is a requirement or not.
• 2% withholding by the State of Colorado. This is a State requirement rather than a Home Owner Association rule, but it surprises many people. It only applies if you are an out of state Seller and you have made a profit on a sale in excess of $100,000. Let’s say you live in Georgia and own a condo at Eagle Ridge. When you sell it, the Title Company is required to withhold whichever is less: 2% of the purchase price or all the net sale proceeds and you must file a state tax return in order to get any of the funds back. There are a couple of ways around it; you must sign an affirmation that you are not making a profit, that it is your primary residence, or that it is owned by an entity with a place of business in Colorado, or that it is owned by a partnership. You are not liable for the 2% withholding if you are doing a 1031 tax deferred exchange into another property. Of course, this doesn’t affect you as a Buyer, but will if you live outside Colorado and are buying a second home or vacation home.

It all comes down to reading the documents provided to you by the Title Company and your REALTOR (R). Hopefully most of these items will be disclosed to you prior to your making an offer on the property. Talk to neighbors where possible, and contact a representative of the Home Owner’s Association. Most HOAs have websites, and the majority of the documents are online.

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