The Anchorage real estate market turned on a spring day last May and has been growing stronger every month as a result of pent-up demand from the prior four years of recession. And with this turn-around the Anchorage condo market has sprung to life once again. For the first two months of this year compared to last year, the number of condos sold jumped 42% and the days on the market decreased 46%. What a change from the sale of only 36 condos in January 2012. Plus, this February the average condo sold for $205,558 compared $170,889 just a year ago.
The condo hot spot is between $224,999 and $249,999 where there are only 15 condos for sale within the Municipality of Anchorage and where over 10 sell per month, putting the supply of condos in this price range at less than one and a half months. So, if you’re in the market for a condo, you had better hurry before summer starts jump the prices up 7%.
But, whether you’re an experienced home buyer getting ready to make the down-size move or a first time home buyer, the purchase of a condominium requires some extra care and reading. Condominiums are part of a common ownership community and they come in all sizes and shapes. There is no easy way to physically recognize a condo. A condo can be a single family home, half of a duplex or an apartment style unit with common hallways. They can be stacked, side by side or totally detached and in any price range.
To find out what you’re purchasing, you must read the public offering statement which is a required condition of approval for every purchase. A public offering statement is issued for every new condo. A resale certificate is issued for one that is being resold. Either one will describe the physical limitations of the property you are purchasing. Particular attention should be paid to the budget. Is the association self-managed or is it professionally managed? How are the cost for water and sewer allocated per unit? I once had a realtor make an offer on behalf of a buyer who wanted to snow plow his own driveway to reduce his dues. Dues are fixed costs and are never negotiated as part of a purchase and sale agreement. Dues are reviewed and established on an annual basis by the board and property management company.
Older condo developments may have future assessments for roof repair, asphalt, exterior painting, landscaping. Unless they are already a pending assessment, they will not be identified in the budget so a buyer should read the prior twelve months of the board minutes where these items will be discussed prior to assessment. Reading the minutes of the board will tell you whether or not there is conflict within the association and what additional costs may be levied in future months or years.
One final note about resale certificates and public offering statements. Make sure that they are current with all amendments. The most reliable resale certificates are prepared by either a professional property management company or an attorney. The cost of a resale certificate or public offering statement is between $250 and $350 per issuance. It is well worth the cost paid by the seller to ensure that it is current and up to date with all the appropriate information, including a budget, all amendments and current phasing plan.