When purchasing a condominium, it is important to review and understand the condominium documents and budget.
 
Condominium documents primarily consist of the Master Deed, Declaration of Trust (which includes the By-Laws) and the floor plans. The Master Deed creates the condominium under the Chapter 183A, the condominium statute. It describes, among other things, the land upon which the condominium is situated, what constitutes the common areas and facilities, a description of the limited common areas, the percentage allocable interest assigned to which unit, the initial trustees of the condominium association and the method required to amend the document. The common areas and facilities are those areas outside of the individual units that everyone uses in common. Examples of these are walkways, yards, roofs, exterior of buildings, installation of central services such as power, light, gas, heating, etc. Limited common areas are those portions of the common areas and facilities that are limited for the exclusive use of one or more but fewer than all of the units. Examples of these are parking, roof rights, private yard, terrace, etc. Moreover, these limited common areas should be clearly shown on the plans that were recorded with the Master Deed. Unless a limited common area is specifically created in the Master Deed and assigned to your unit in the Master Deed or in the first unit deed conveyed by the developer, you will not have the exclusive use of that area. Accordingly, it is imperative that the documents are reviewed prior to the Purchase and Sale Agreement and a thorough title search of the documents at the Registry of Deeds is conducted prior to closing, to insure you are getting that parking space or roof rights that you believe you are getting. Needless to say, limited common areas have an enormous value and if one is not properly created and granted, it affects the value of your unit as well as its use and enjoyment.
 
In regard to the budget, it may be a simple handwritten document for a small condominium or software generated one for larger condominiums. Naturally, it is important to review it to insure that the revenue generated from the condominium fees equal or exceed the expenses of the condominium. Although not usually apparent from the budget, you should inquire as to what, if any, the amount of money in the condominium reserve is. This money will pay or help offset any capital improvements that may be required. Lastly, if you total the expenses set forth in the budget, multiply your percentage allocable interest and divide by 12, you should arrive at your monthly condominium fee.
 
Craig Gilmartin
Gilmartin, MaGence, Camiel & Ross LLP
376 Boylston Street
Boston MA 02116
Tel: (617) 375-9000
Fax: (617) 375-5700
Email: cgilmartin@gmcrlaw.com
Web: www.gmcrlaw.com