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Thursday, March 22, 2007

Condominium Assessments...A Wake Up Call!

Besides writing about resales in the Charlotte Condominium market, I will share from time to time the priceless jewels that come across my path...and this one is a classic! From the Tar Heel Realtor Newsletter, February 2005...A Question to the Forms Guy from an agent in NC.

Dear Forms Guy,
I have a listing on a condo. It's under contract and was supposed to close yesterday, but there's a problem. When I took the listing, the seller told me he had read in his association newsletter that bids on repainting the exterior of all the units in the complex had come in considerably higher than anticipated, and that there might be a special assessment to cover the increased costs. I called the treasurer of the association and he told me that the association's board had discussed the possibility of an assessment at its last meeting but hadn't voted on it yet. Even though the assessment hadn't been approved, to be on the safe side the seller checked "Yes" to question No, 19 on the Residential Property Disclosure Statement and wrote in "ASSESSMENT TO PAINT ALL UNITS BEING CON- SIDERED BY OWNERS' ASSOCIATION" in the blank at the end of the Disclosure Statement. We got a good offer on the condo, and I wrote the exact same wording in the first blank in the "Special Assessments" section (paragraph 6) of the Offer to Purchase and Contract. I wrote "N/ A " in the second blank in paragraph 6 since the assessment had already been disclosed on the Disclosure Statement and in the first blank in paragraph 6 of the Offer.
The board voted to approve the assessment a week before the closing date. It will be paid in 12 monthly installments beginning in two months. When the closing attorney's paralegal faxed me a copy of the HUD-I settlement statement the day before closing, it showed the assessment as the seller's obligation. I called the attorney and told her in the nicest way I knew how that her paralegal had screwed up the HUD-I. She told me the contract clearly stated that the seller was obligated to pay the assessment. What I want to know is, how can that be? Number one, the seller disclosed the assessment on both the Disclosure Statement and the Offer. Number two, it's not even payable until after the closing date anyway.
Would you do me a little favor and call the closing attorney and set her straight? Signed, Mighty Miffed
Dear Mighty Miffed, I'm mighty sorry, but I think the closing attorney is right. There are two blanks in the Special Assessments paragraph of the Offer to Purchase
and Contract form (standard form 2-T), and they serve very different purposes. In the first sentence of paragraph 6, the seller warrants that there aren't any pending or confirmed special assessments. If there are any pending or confirmed special assessments, the blank at the end of that first sentence is where the seller must describe them.
The second sentence of paragraph 6 is an agreement between the buyer and seller about who will be responsible for any pending or confirmed special assessments that may exist. The way the pre-printed wording reads, the seller is responsible for any special assessments that may be "con- finned" through the time of closing, and the buyer is responsible for any special assessments that may be "pend- ing." According to the Guidelines for Completing the Offer to Purchase and Contract (standard form 2G), "[a] ' Confirmed ' assessment is defined as an assessment that has been imposed by a governing body. A 'Pending' assessment is defined as an assessment that is under consideration by a governing body." If the parties agree to
vary the pre-printed wording about who is responsible for the payment of any assessments, that agreement needs to be set forth in the blank at the end of the second sentence. In your situation, the seller properly disclosed the existence of the "pending" assessment in the first blank in paragraph 6. However, just because the seller disclosed it doesn't make the buyer responsible for paying for it. Since the condo association board approved the assessment prior to closing, the second sentence of paragraph 6 states that the seller is responsible for it unless otherwise agreed in the blank at the end of the sentence. Since "N/ A " was inserted in the second blank, the parties did not agree other- wise, and therefore, the assessment is your client's obligation. Also, it is immaterial that the owners won't actually begin paying for the assessment until after the closing date. The assessment was "confirmed " when it was
imposed by the board, not when it becomes payable by the owners.
Sincerely, Forms Guy.
NCAR, 4511 Weybridge
Lane, Greensboro, NC 27407.

Tuesday, March 20, 2007

Charlotte's First Condominium built by Kathryn Smetana

Kathryn Krause Smetana
Built the first condominium in Charlotte in 1970. With great care she built Gaynor Arms in Randolph Park at Cotswold. This is her story.
She was born September 15, 1910 in Philadelphia, Pa. Her parents were Michael and Catherine Krause.
She went to school in Philadelphia until she was fourteen years old. Then she went to work with Apex Hosiery Company in Philadelphia. She went to Continuation School to complete her high school education while she worked. At sixteen years of age she left Philadelphia and came south. She worked several years in the Greensboro area and became quite proficient in all of the production jobs associated with the manufacturing of women’s hosiery. Soon she became an instructor, and it was not long before she was quite in demand to teach her skills. Whenever a new mill opened, Kathryn was hired to train the women in production. And her jobs took her to the Concord area and to Gastonia. As soon as the manufacturing plant was up and running smoothly, she would go to another start-up mill.
In the late thirties, Otto Smetana opened a new mill in Monroe, NC and hired Kathryn to train the staff in production. This time she stayed and married Otto.
After World War II the hosiery business changed drastically. The stocking that had the seam up the back was called full fashion. Rather than convert the plant to make hosiery as it is today, Otto Smetana sold the mill and retired from the hosiery business. He and Kathryn traveled extensively throughout the USA.
Otto and Kathryn built a bowling alley, Park Lanes, near Park Road Shopping Center. They later sold it, but Kathryn and her brother in law ran The Wash Bowl Laundry in the basement of the bowling alley. Otto and Kathryn lived in a home on Ferncliffe Drive during this time. Otto passed away in the early sixties.
Kathryn got the building bug and decided to build a condo. The plans and specs were started in the late sixties and Gaynor Arms was started in 1970. Kathryn gave thought to every detail including security, storage, elevator, central laundry, clubroom and covered parking.
After completing Gaynor Arms, she moved to Florida and built four houses there. She stayed on in Florida for seventeen years, but in 1986, returned to her condo at Gaynor Arms.
Kathryn passed away January 23, 1998.
A long and cherished friend of Kathryn’s, Al Busedu, was kind to write this story in memory of his friend.
Thanks, Al…another Angel.

Monday, March 19, 2007

Journey of a 1000 miles begins...

Okay, now that I have written a little about who I am and where I am from, let's begin with what my intention is for this blog. I enjoy this Charlotte is interesting to observe the changes in the last several years. Charlotte is growing, the marketplace tries to accommodate the change, people come for jobs, people come to be with their children, people come because the climate is pleasant, people come because Charlotte is a good place to raise a family. Our real estate changes...patio homes and condos to suit the beginners and the empty nesters, condos and townhomes to suit the single professionals, million dollar+ homes for those coming from the larger markets. People invest, to live, to start their lives.
Real estate technology changes...from a big, thick weekly book with all the listings to terminals to the Internet. We grow. Many focus on the new condos. The hip, all glass, uptown spaces within walking distance of arenas and stadiums and pubs...the towers dot our futures. There is a lot of speculation. There is a lot of buzz. There are many people jumping in the game.
All that glitters is not gold.
Our name is CC...Condo CanDo...and that might also stand for cautious, curious, careful, conservative. Me and the kid in the red cape, Condo CanDo, will leave the new to the new...I will begin with older condominiums and townhomes because there are some interesting stories and charming condos and townhomes throughout our city, Charlotte.
This is my plan.
Lynnsy Logue, The Real Estate Lady and Condo CanDo