Chicago Condo Resource

When you purchase a condo, your financial responsibilities consist of several components.  Here is a breakdown of what you’ll pay and the tax benefits you’ll reap as a result…

Condo living is a unique form of community living. When you purchase a condo unit, you make a legal agreement to abide by the rules established in the Association’s Declaration & By-Laws.  It’s a good idea, therefore, to know exactly what you are agreeing to…

Owning a condominium unit can be a great investment move.  It is also a popular living option in and around Chicago.  However, condo living isn't for everyone.  It's important to know a bit about what it means to own a condo unit before you decide to make a purchase..

Condominium association living is not merely a form of property ownership.  At its essence, a condominium association is a business and each owner is a shareholder in that business.  As a result, there are certain Administrative Best Practices your Association should follow to ensure that you are running your business right.

Perhaps the worst possible thing a Board can do (save outright stealing) is to neglect to communicate with the owners.  Failing to communicate breeds suspicion and distrust among owners and may affect the Board’s ability to get their job done efficiently.

A reserve study is a comprehensive report of a property’s major common element components as well as a budget planning tool.  Without careful planning, common area components such as roofs, roadways and siding can become serious financial liabilities to community associations.  A reserve study serves as a road map for planning an association’s budget, meeting all legal, fiduciary and professional requirements, minimizing the need for special assessments and enhancing property resale values.

In a new construction or new conversion building, the developer performs the duties of the Board of Managers until control is turned over to the new owners.  An election for the first owner Board must be held when one of two events has occurred.

by Wolf Peddinghaus, HausFS

A reserve study is the process by which the condo association board anticipates and prepares for major common area expenses.  Whether it is the roof that needs to be replaced in 5 years, the boiler in 10, or the mortar in 15, common areas will deteriorate over time and will require repair or replacement.

This Association doesn’t run itself!  It takes a small army to keep the machine humming.  Your involvement and effort can help to keep it in tip top shape, and will guarantee that your opinions are taken into consideration.

One of the most important items on a new Board’s To Do list is to engage the services of a professional to audit the developer’s financial records, for two main reasons.

by Jim Taylor, Taylor Assurance Group

A review of your Association's insurance policy is in order following turnover of control from the developer to the new Board.  The following checklist will help you to determine if your insurance policy is sufficient.

"How can we ever hope for world peace if we can't even achieve peace in our own condominium building?"

Living in a condominium building can be a challenge.  Serving on the Board can be an even greater challenge.  It’s important for both non-Board member owners and those serving on the Board to understand the rights and responsibilities that exist for both groups when it comes to community living.

At the initial meeting of the owners and each year thereafter (at the “annual meeting”), unit owners elect their Board of Managers (the “Board”).  Depending on the size of your Association, the Board may be elected on a volunteer basis or by a formal election process.

The purchase of a condominium unit carries with it the agreement to abide by the Declaration and By-Laws of the Association as well as any other Rules and Regulations determined by the Board.  But how does a Board enforce these rules and regulations when an owner violates them? 

by Kate Dargis, HausFS

I recently attended a seminar sponsored by the Lakeside Community Development Cooperative about the process of taking over building management from the developer and developing a governing Board.  As a non-owner, I was in the same boat as the new owners in the room - I knew very little about the turnover process.

By Lauren Peddinghaus, HausFS

Info about the meetingup.com group for condo owners to connect and learn.

If your Association doesn't have the reserves necessary to fund major repairs, your Board may need to consider a bank loan or line of credit.  If you plan to apply for financing, you'll need to have certain documentation available.

by Amy Karatz, Natural Order Staging - naturalorderstaging.com

It’s a buyer's market, so what can you do to make sure your condo sells quickly? Owners who use these rules when Staging their condominium for sale are rewarded with higher profits and faster sales.

Long, tedious meetings can often discourage owners from volunteering to serve on the Board.  But Association meetings can be conducted quickly and efficiently if you stick to a standard procedure.  

When you start a new job, you often receive an Employee Handbook filled with information about how the company operates.  Similarly, new owners should receive an Owner Handbook when they purchase a unit in your building, with everything they need to know about how the Association operates.

Chicago may be woefully behind the times when it comes to city recycling services, but your Association can make a positive impact by establishing its own recycling program.  Recycling will even earn you a rebate from the city.

Assessments are the lifeblood of every Association.  In order to maintain the investment you've made in your real estate purchase, your Association must have the cash flow necessary to pay the bills for the common expenses and plan for future financial needs.  When assessments go uncollected, the entire building feels the effects.

For certain individuals, 73 degrees isn’t hot enough, while others couldn’t be happier when the thermostat reads 65.  For buildings with common heating systems, it can be a challenge to find a temperature that will make everyone happy.  However, the city does have minimum requirements that condo buildings must observe.

by Wolf Peddinghaus, HausFS

Not all common elements in a condo building are created equal.  Rather, some common elements are limited common elements.  What is the difference between the two, and who is responsible for maintenance of each?

Board members often want to know if there is a standard list of rules that they can implement for their own Associations.   However, there really is no "standard' when it comes to Rules & Regulations--each Association is unique and their R&Rs should reflect that.  HausFS recommends the following when it comes to implementing rules...

Download a PDF version of the popular seminar by Lauren Peddinghaus of Haus Financial Services, "Best Practices for Small and Self-Managing Associations."  Includes links to important reference websites.

We recently installed a rain barrel at our building and following last night's rain, we now have a full barrel!  We just saved 55 gallons of water from going down the sewer, and we'll be able to use it to water our garden. 

Now that summer has arrived, we are watering our plants daily. Watering in the summer can account for up to 40% of household usage. Our $40 investment should pay off over the long haul, especially with water rates increasing 14% in 2010.  And it feels good to make a positive contribution to the environment, however small. 

Find out how you can get a rain barrel (or two!) for your thirsty property:  http://www.chicagorainbarrel.com/

by Lauren Peddinghaus, Haus FS

In our work with new associations, we’ve encountered a recurring theme when it comes to new conversion and new construction buildings in a down real estate market …

Too often, new condo owners receive their Declaration & By-Laws at closing and file them away, never to be seen again.  But these documents are the basis for governing your Association.  When there is conflict, the issue can almost always be settled by consulting your Declaration & By-Laws.  Understanding the purpose of these documents will help to decrease conflict among owners.

Handling the finances of the Association is one of the greatest responsibilities delegated to the Board and a time-consuming job for the Treasurer.  Here we detail the Board’s financial responsibilities and outline the procedures that the Board can implement to promote a financially sound Association.

by Lauren Peddinghaus, HausFS

My goal with the Chicago Condo Resource was to share my condo expertise to help other condo owners.  Little did I know the first person who would benefit from the site was me! 

When a condominium owner sells their unit, the Board or property manager will be asked to provide certain documents and information for the closing.  There may be a fee involved in obtaining this information.  Here is what may be requested by the seller, a mortgage broker, an agent or an attorney involved in the transaction…

When an owner becomes delinquent on assessments, the Board has a duty to collect the funds due to the Association.  Because the process can take some time, it is important not to let the delinquency occur for too long before taking action.

The IL Condo Act requires that certain items be turned over by the developer.  There are also additional items that your new Board may need in order to properly maintain and administer the property.

by Steve Rivera, Otavala Consulting

What do you do when faced with conflict in your daily life? Depending on your personality you may face it head on, you may deflect it thus continuing the conflict, or you may just avoid it all together pretending it doesn’t affect you. This is what is known as conflict management.

Now that you've completed your turnover and elected a new Board, there is some administrative work necessary to complete the transition from the developer to the owner-controlled Association.

Energy expenses are often comprise the greatest portion of your Association's annual budget, as well as your individual bills.  Here are some great tips for saving money on energy use in your building and your individual unit.