The Condo Buyer's New 7-Day Review Right: What Sarasota Buyers Must Know

0:00Welcome back to my Real Estate Podcast with David Liberatore. I'm really excited about today's topic because it's something that affects a lot of condo buyers out there.

0:09And honestly, I think a lot of people don't even know about it. David, we're talking about this new seven-day review right for condo buyers.

0:19What is that exactly? Thanks for having me. So this is actually a really important protection that condo buyers have.

0:26Basically, when you're under contract to buy a condo, you now have a seven-day period where you can review all the condo documents, the bylaws, the financial statements, the reserve study, all of that stuff.

0:40And you have the right to back out of the deal if something doesn't look right. Oh, wow. Okay, so you're saying you can actually walk away, like no questions asked within those seven days?

0:50Well, not exactly no questions asked. But yeah, you have that contingency right. The idea is that you get time to really dig into what you're buying.

0:59A lot of buyers rush into condos without understanding what they're getting into financially. And this gives you a real chance to do your due diligence. That's huge.

1:09I mean, condos can be complicated, right? There's HOA fees, special assessments, reserve funds. It's a lot to understand. So what kind of documents are we talking about here that you need to review?

1:21Yeah, exactly. You're looking at the condo association's bylaws, which tell you how things operate. You want the financial statements, usually the last couple years, so you can see if the association is healthy

1:35or if they're struggling. The reserve study is critical because that tells you if they've got enough money set aside for big repairs, like roof replacements or structural work.

1:46And then there's the budget, any pending lawsuits, special assessments that might be coming. It's a comprehensive look at the building's health. So if I'm reading those documents and I see something that concerns me, what happens?

1:59Like, do I need a lawyer to help me interpret all this? You definitely can hire a lawyer. And honestly, I think a lot of buyers should. But you can also work with your real estate agent or even a condo specialist who understands how to read these documents.

2:14The key thing is you want to understand what you're looking at before that seven days is up. If you see red flags, like the reserve fund is critically low or there's a major lawsuit pending, that's something you need to know about.

2:31Right. So what are some of those red flags people should actually watch out for? What would make you go, yeah, I'm not buying this condo?

2:38Good question. If the reserve study shows the building needs major work and there's no money set aside for it, that's a big one. If there are multiple special assessments on the horizon, your monthly costs could skyrocket.

2:52If there's litigation involving the association or the building itself, you need to understand what that means for you as an owner. And if the financial statements show the association is running at a loss year after year, that's unsustainable.

3:09Wow. So this seven day period is really your window to avoid some serious financial headaches down the road. I'm curious, how many buyers actually use this right?

3:19Do people take advantage of it? That's the thing. A lot of people don't even know it exists or they rush through it because they're excited about the property.

3:27But the smart buyers, the ones who really want to protect themselves, they use every single day if they need to. They get their attorney involved, they ask questions, they really dig in.

3:39And sometimes that's when they discover something that changes their mind. That makes so much sense. So if someone's listening to this and they're about to buy a condo, what's your advice?

3:49Like what should they do right now? First, make sure your purchase agreement actually includes this seven day review contingency. Don't assume it does.

3:59Second, request all the condo documents as soon as possible. Don't wait until day six. Third, get a professional to help you review them, whether that's an attorney, your agent, or a condo specialist.

4:13And fourth, take it seriously. This is your chance to really understand what you're buying. I love that practical advice.

4:21You know what I think is so cool about this, right? Is that it's really putting the power back in the buyer's hands. You're not just taking someone's word for it, you can actually see the numbers yourself.

4:33David, this has been super helpful. Thanks so much for breaking this down for us. Thanks for having me. It's such an important topic and I'm glad we're getting the word out about it.

4:42A lot of buyer problems down the road could have been prevented with a good review during those seven days.