CONDO ASSOCIATIONS
The 800-Pound Condo In The Room:
The Harsh Realities Of Condo Associations Getting Older In 2017
Since the dawn of humankind, Homo sapiens have lived in communities. From the first groups of cave dwellers, we’ ve huddled together for our own survival— the literal success of our species. What is new is the concept of condominium associations. Here, an anthropologist might say, is a unique form of human socialization. Picture a single cave, owned equally by all the cave dwellers, ruled democratically— the first cavedominium!( Society Hill at Mesopotamia?)
The first condominium associations in New Jersey came about some time in the mid-1960s, with some of the earliest condos evolving from apartment buildings which may have been built even earlier. As time went on, builders found improved profits were to be had in constructing conjoined housing instead of single family homes.
Quickly, condos were everywhere.
The advent of commonly owned buildings created opportunities, questions and challenges. Attorneys and lawmakers put together the concept and the paperwork. Builders flourished. Banks sold more loans and property management firms sprouted. A relatively
small number of insurance companies jumped in the pool. Some quickly jumped back out.
For years, the few insurance companies which participated in this new market did well. With new condos appearing regularly in New Jersey, the flow of new business was steady. Condo associations performed extremely well. Roads and sidewalks were perfect. Roofs and plumbing were all new and didn’ t leak. Unit owners enjoyed sitting by the community pool as their kids played on the new playground.
WHERE ARE WE NOW? The bulk of condo associations in New Jersey are now probably around twenty years old. Many are older. Unit owners, like any other homeowners, must now face the costs needed to maintain, repair and in some cases; replace the major components of their buildings. Boards of directors which have reserved money over the years are best prepared for these costs, but some associations have not adequately set the money aside, fearing backlash from unit owners or not seeing the need to save for a rainy day. That’ s where a great property manager can make all the difference.
According to Bruce Young, property
manager at Taylor Management,“ Many condos which were built in the late 70s or early 80s generally were self-managed and had governing documents that were not specific in spelling out the need for the association to save for future major expenses. Some associations knew that saving for the future would make sense, but still did not save, as the theory of‘ Let the future board worry about it’ prevailed.”
Even though most unit owners understand quite clearly the need to maintain their property in order to preserve and even enhance the market value of their units, there may be those in the association who still must push back. In instances where individual incomes are fixed or declining, boards have to argue their position. This is where the experiment of condominium living hits its first major obstacle.
There may be cases where, even though unit owners were able to afford purchasing their units, they may not be able to afford to maintain them in the face of increasing costs for practically everything. Thus, when discussions arise to resurface the roads or replace the roofs, there will be many votes against such a large expenditure, even though it obviously must be done. According to
28 | SPRING 2017