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Expecting the Unexpected
Condominium trustees and homeowners who thought New England was immune to such catastrophic events have received wake-up calls in recent years. New Hampshire residents haven’t yet forgotten the floodwaters that rushed through their neighborhoods a few years ago. Pest control companies have been battling armies of irritating bedbugs. And just weeks ago, a band of tornadoes left large swaths of Massachusetts’ communities in ruins.
Read MoreStrings Attached
Although they are supposed to have a so-called reserve account to cover anticipated capital expenses—roof replacements, exterior maintenance, elevator upkeep, and the like—many condominiums, especially in the last few years of economic hardship, have scrimped on reserve funding in order to ease the monthly burden on unit owners paying condo fees, leaving many reserve accounts under-funded.
Read MoreOverlooked Savings
As annual and quarterly budgets come up for review, associations are looking to
cut additional costs anywhere and everywhere they can. But how much more “fat” can be trimmed from budgets? Surprisingly, there are a few unsung cost saving
measures that associations may have overlooked – and with some innovative and cooperative changes, condominiums may still be
able to pull some extra cost savings from their financial hats.
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Drafting a Budget in Uncertain Times
Even in the best of economic times, preparing a condominium's annual budget is a tiresome task, fraught with uncertainty, estimations and shifting numbers. Now, factor in one of the most challenging economic downturns in a century with cash-strapped owners who may be "skipping" monthly condo fees – or even winding up in foreclosure – and you have a downright daunting task. Read More
Greening for Savings
From your neighbor’s spiffy hybrid automobile to Leonardo DiCaprio’s “célèbre-green” status, it’s clear that increased attention to the environment is both vitally important and in vogue. It is also clear that there is huge savings potential in increasing energy efficiency. But what to do and how to do it is a little less clear. From basements to rooftops, here are a few ideas for bringing your building from light green to dark green. Read More
Squeeze Play
Tighter lending requirements for Federal Housing Administration (FHA)-backed
mortgages for condos have put financial and administrative pressure on condos
around New England at a time when many are ill prepared for any new challenges.
The most onerous of the new requirements are mandated reserve fund
contributions, a 15 percent limit on condo fees delinquencies, and the
specification that the condominium itself obtain FHA approval – this resulting in reams of additional paperwork for community associations.
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How Low Can You Go?
Bad economic news is pretty much inescapable these days. You can’t turn on the TV without hearing about another round of layoffs or shaky consumer confidence. The stock market is unstable, retirement funds are shedding value, the housing market has slipped into reverse and uncertainty is hanging in the air. Read More
Federal Form 1120-H, 990 or 1120?
For the uninitiated, tax filing for something as complicated as a community association can seem more than daunting. Fortunately, there are multiple options for homeowners associations, and with a little background knowledge, you can take the first steps toward making the right choice for your particular situation. Read More
You'd Better Shop Around
The day-to-day costs of running a multifamily residential building are significant. There’s the fuel oil, electric, cleaning supplies, equipment maintenance and service calls for repair and upkeep. Then there are the insurance costs, landscaping, trash removal, snow removal, advertising, property taxes, and maintenance fees.
Read MoreUnderstanding Your Condo's Finances
Management of a condominium community is much like democratic government in a
small town or village. The budget process is remarkably similar, whether it’s fees or taxes being collected, and, as in local government, financial
management is a transparent system based on “GAAP” (generally accepted accounting principles).
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