What to Consider When Buying a Condo: HOA Dues, Reserves, and the Questions Worth Asking
Buying a condo means looking at the unit and the association together. The dues matter, and so do the reserve balance, the assessment history, and whether lenders treat the building as warrantable. All of it sits in the disclosure package you'll get during escrow.
Some issues show up in the unit, others in the building. The association documents cover the second kind, so here's what's worth a look when that packet lands.
The monthly dues are only part of the picture
Dues are a real monthly cost, and a signal about how the building is funded. Low dues in an older building can mean the association is underfunding something, and that cost can show up later as a lump sum.
Start with what they cover. Some include water, trash, gas, cable, and earthquake coverage. Others include almost nothing, so two buildings with identical dues can carry different costs. Then there's the master policy, which usually stops at the drywall. You'll still want your own HO-6 walls-in policy, and it's worth knowing the master deductible and whether any of it can land on owners.
Reserves show you what's coming
California's Davis-Stirling Act requires most associations to have a reserve study done at least once every three years, with a visual inspection, and to review it yearly. It covers the major components the association is on the hook to repair or replace that have under 30 years of useful life left, what that will cost, and how it plans to pay.
One number worth finding is percent funded. Around 70 percent or better is generally treated as well funded. One in the 20s with a 40 year old roof usually points to a large bill ahead. Read the funding plan against the component list, and check the study is current. Aging plumbing stacks and end-of-life deck waterproofing show up here, not in the listing photos.
Special assessments, and how to see one coming
A special assessment is a one-time charge to every owner, usually for something reserves couldn't cover. They range from a few thousand dollars to six figures per unit.
Sellers have to disclose assessments the board already approved. The ones still being debated are harder to catch, and that's what board minutes are for. Under Civil Code 4525 a seller has to provide the last 12 months of open board meeting minutes on request. They're dry, and they're where roof bids, plumbing debates, insurance renewals, and litigation surface first.
The financing question worth asking early
A condo can be a good home and still be hard to finance, which affects your loan now and your resale later. Fannie Mae revised its rules in March 2026. As of August 3, 2026, Limited Review is gone, so most projects now get a Full Review, where underwriters look at deferred maintenance, structural reports, special assessments, reserve balances, and insurance rather than checking one box. Starting January 4, 2027, the minimum annual reserve contribution rises from 10 percent to at least 15 percent of the annual budget, weighed alongside the rest of the picture.
When an association is deemed non-warrantable, buyers often need larger down payments and face higher rates, which can shrink the buyer pool. Getting your lender to look at the project early leaves room to react.
Know what's actually yours
Under Civil Code 4775, unless the CC&Rs say otherwise, the owner maintains exclusive use common areas like a balcony or patio, and the association repairs and replaces them. The CC&Rs can shift that, so it's worth confirming.
Civil Code 5551, from SB 326, also requires associations in buildings of three or more units to inspect balconies, decks, stairs, and walkways substantially supported by wood and more than six feet above ground. The first deadline was January 1, 2025, and inspections repeat every nine years. That report belongs in the disclosure package, and an association that can't produce one is worth a closer look.
Frequently asked questions
What should I ask about HOA dues before buying a condo?
Ask what's included, what the master policy covers and what its deductible is, whether any of that deductible can land on owners, how often dues have gone up, and how many owners are behind.
How much should a condo association have in reserves?
There's no legal minimum. Percent funded is the usual yardstick, and around 70 percent or better is generally treated as well funded. Lower isn't automatically a problem, but weigh it against how old the roof, plumbing, and elevators are.
Can I see the HOA board meeting minutes before I buy?
Yes. Under Civil Code 4525 the seller has to provide the last 12 months of open board meeting minutes on request, along with the budget, reserve information, and the balcony inspection report.
What is a non-warrantable condo?
One that doesn't meet agency lending guidelines, often because of low reserves, deferred maintenance, litigation, or too much commercial or single-entity ownership. Financing gets harder, you'll usually need more down, and reselling can take longer.
Thinking about buying a condo?
Condos across LA range from waterfront high-rises in Marina del Rey to newer buildings in Playa Vista to small 1960s walk-ups all over the city, and every association is its own story. If you're buying a condo anywhere in LA, get in touch and we can talk through what you're seeing.
Sources: California Civil Code sections 4525, 4775, 5550, and 5551 (Davis-Stirling Act), and Fannie Mae project standards and reserve funding updates announced March 2026. Reviewed September 2026. This is general information, not legal, tax, or financial advice. Association documents and lender guidelines vary and change, so review the disclosure package alongside your lender, attorney, or CPA.
Megan Majd, Compass · DRE #02089919 · (310) 845-6209