Many inspectors will discount the cost to inspect a condominium townhouse because the exterior features (shingles, roof structure, windows, paint etc) are maintained by the condominium corporation, and, theoretically our liability is lessened.
However, our standards require us to inspect all of these areas and report on them.
If we do report on them, are we not opening ourselves to additional liability?
But if we don’t report on them… we are not working to the standards.
Can we specifically disclaim responsibility for the exterior defects, not report on them and still be working within the standards?
You can report on whatever you want, as per your clients needs and wants. Nothing prohibits you from limiting your inspection to one, two, three components, etc. Just make sure your agreement spells out what you will and won’t be inspecting. More importantly, make sure your client **knows **if you will or will not be inspecting “common areas” or areas that are the associations responsibility - and why.
There is a good (albeit lengthy) narrative in the1,000 narratives (at RRs wise old grandmother site) regarding exactly this.
I report on the condition of roofs, windows, etc but I also include verbage that the condo corp is responsible for maintance etc. and advise the client as well.
I advise the client that I will visually look at and comment on the exterior/common areas , as it is something they have no control of, as it is the associations responsibility. That being said, IF the complex shows a lack of “pride of ownership”, I will point that out, and advise them to check with the association as to (if) they have reserves for future/potential problems.
Know of a young couple (first time home buyers, just married) that purchased a condo. I doubt they had it inspected. In the first few weeks of ownership, they received notice of a cash call to replace the roofs.
Come to find out, it was common knowledge there was not enough in reserves, thus, the seller had to know about the cash call, but did not advise the buyer.
Common problem with condo associations, is they tend to keep their monthly dues low, enough to cover current expenses, but not enough to build up a reserve.
All condo buyers should look at the complete situation, ask if there are any unfunded repairs in the near future, and does the association have reserves to cover them.
Steven I always recommend my clients look over the minutes and and reserve funds, but remember no Lawyer will do that for you, and often it is lip service only when they say they will, but at least you warned them.
The buyer can request financials from the association, and the seller should have monthly and year end financials that are provided to all the owners. Any competent Realtor should be able to get those for the buyer. But, then, the key word here is “competent Realtor”.
My take on the buyer is: you can lead a horse to water, but you can’t make them drink.
I’m just thinking out loud here (as I live in a Condo). Why would you not inspect everything? I know that when I purchased my condo the inspector pointing out a few issues on the roof and fascia (both assocation responsibility). The notes were sent to the association and fixed before escrow closed. If the inspector hadn’t looked at the roof I might have ended up with more serious issues.
Sellers of condo units in Ontario must provide a “Status Certificate” when selling a unit. The certificate includes disclosure of financial reports and any pending special assessments, among other things so the buyer knows what
they are getting into.
I do lots o f condo inspection here. The contract I use clearly indicates it is a LIMITED REVEIW OF THE INTERIOR ONLY and is also stated on the front page of the report. The client at the time of booking is made aware that the inspection will an interior in spection only and at less cost than a full inspection, but if the client wants a full inspection then they pay the full price.
PLEASE NOTE: THIS PROPERTY IS IN A COMMON INTEREST DEVELOPMENT. Maintenance of the communal areas, systems, and components is typically the responsibility of a Homeowners (or similar) Association. Inspection of these areas is considered beyond the scope of this inspection. Furthermore, as the parameters of this unit, common areas, and exclusive use common areas, can only be determined by review of the Association’s “Covenants, Conditions, and Restrictions” CC&R’s (again beyond the scope of this inspection), any comments that may pertain to said areas, have been made as a courtesy only, and should be addressed via the current owner of the Association.
Correction of common area deficiencies will be at the discretion of the Association. “BLUEWATER HOME INSPECTION” Shall not be responsible for erroneous comments or omissions concerning deficiencies involving communal areas, systems, or components. We recommend obtaining and reviewing a copy of the Association OPERATING BUDGET.
A properly prepared budget will include a RESERVE STUDY. The reserve study should be based upon an on-site condition evaluation, preferably by an independent third party. The study should provide information regarding the useful and remaining life expectancies, and replacement costs, of the major systems and components that the Association is obligated to repair, replace, restore, or maintain. Most reserve studies or budgets will also include a statement of the available funds as a percentage of the necessary funds (“percent funded”). It is also important to verify that the Association has adopted a sound funding strategy to cover future reserve expenses. Additional information should be obtained from the Association with regards to their knowledge of any: construction defects; disaster damage; the extent of repairs involving said defects or damage; and pending claims or litigation involving the Association. Furthermore, copies of prior board minutes should be obtained for review.
