You never really know when you are looking at condos how much money the association has on hand. And I am not privy to that information a lot of the time. You will have a "condo doc review period" in which you will find out...but how much is enough? Many larger buildings in town have over $1,000,000, and many smaller associations have zero (in all fairness though, think of how limited the common area is in say a Brownstone Building). I think looking at the overall condition of the building should help alert you to the need for strong reserves (money in the kitty). And comparing that with similar buildings in the area is a good idea should you have concerns.
And here is a new twist I hear from local lenders-
IF A CONDO ASSOCIATION IS NOT PUTTING AWAY 10% OF THEIR MONTHLY COSTS INTO RESERVES....MANY BANKS WILL NOT OFFER LOANS ON SUCH CONDOS....And this may seriously screw with your ability to resell your condo at a decent price....If your condo can't be financed- the demand for your condo is going to fall off the side of a cliff, perhaps.
If I may be the unpopular voice of reason....I think this is a good thing for your association. All associations need a cushion to save for a rainy day. Because you know what? One day that roof will leak. And even doing simple upkeep items like keeping the hallways bright, clean and freshly painted only adds to your condos value. Condo buildings are like hair-dos and automobiles- they need to be maintained to keep their appeal. So collect, save and spend. Know that new constructed buildings in town may need significantly less in their kitty, as there is no deferred maintenance to contend with....
If you are wondering if your condo is collecting enough money/spending it
in a way to help protect the value of your condominium...
Give me a call and let's chat...perhaps I can give my two cents.
Mark Wade 267.237.3404