ArcaMax

Q: I would love to buy one entire condo building (not the whole complex) and have all my friends and family live “together” with me. How would I go about doing that?

A: It’s nice of you to think about having all of your friends and family live in one condominium building. But, do all of your friends and family actually want to live in the same place?

Assuming they do, you should start by looking for a building that has the requisite number of units required. We imagine you’re looking for a smallish building that may be part of a larger development. This might look like a series of buildings located in a gated community. Or, the building may be part of a development with common amenities, like a clubhouse or workout room. In some cases, each building might have been created as its own condominium. In others, each building’s units are separate condos. Then all of the condominium buildings in the development are part of a larger homeowners association.

Next step, you’ve got to buy the property. Let’s say a building has 15 units. You’d need to purchase each condominium one at a time or make an offer to all of the unit owners in that building at the same time.

If we assume that several units are available for sale in the building today at a price that you like, you could purchase those units upfront. Having those units in your pocket, you could then approach other unit owners about buying their units. Once you own enough units, you could force the remaining owners to sell their units to you.

You’ll need a team of people to help. A real estate agent can help you identify possible buildings. A real estate attorney can assist you in developing the purchase strategy and taking it through to closing. And, yes, even in states where attorneys aren’t typically used to close real estate deals you would need one to manage this process. Why? If you buy a couple of units and then can’t buy others, you might be stuck owning those units but never buying the entire building. The attorney can act as your representative and help you understand the different local and state legal requirements involved with buying an entire condominium building.

Some buildings or homeowner associations restrict the number of units any one person or group of people can own. You also need to consider what local or state laws might be in place that force you to go through a certain process when it comes to buying up all of the units in a building.

The governing documents for condominium associations may have provisions regarding the sale of a building as a whole. The document may require a vote of two-thirds, three-quarters, 90% or even every unit owner for the sale of the building to take place. You’ll want to know what you’re getting into before putting any time and money into a bidding on a particular building.

You could look for a smaller building, one that is perhaps not in a development, and try to arrange for those owners to sell to you. Keep in mind that some people might have lived there for a long time. They might be attached to their homes, and may not want to sell and move. You’ll have to be persuasive or offer an above-market price for the property.

You might get lucky. Depending on where you live, the housing market might not be as tight. You might find a small building where majority of the owners in the building are selling or want to sell. We’re thinking, for example, about parts of Florida, where assessments have skyrocketed because of the new state law and insurance premiums are rising because of climate change. You can buy all of the available units today, and continue to buy units until you own them all. However, while you own those units, you’d still have to run the building as an association and follow the rules of the association.

We say this because you can’t own a majority of the units and simply do as you please. The other owners will expect you to follow the rules of the governing documents until you own all of the units. At that point, you decide whether to dissolve the homeowners association.

Another option? You might look for a small rental building, perhaps one with just 10 units or so. That way, you’re buying from a single owner and not dealing with a bunch of condos. The trick is to find an owner who wants to sell. Then, you’ll need to renegotiate the terms of the tenants, which is easier or harder depending on the state and city in which you live.

Good luck! Let us know how it goes.

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(Ilyce Glink is the author of “100 Questions Every First-Time Home Buyer Should Ask” (4th Edition). She is also the CEO of Best Money Moves, a financial wellness technology company. Samuel J. Tamkin is a Chicago-based real estate attorney. Contact Ilyce and Sam through her website, ThinkGlink.com.)

©2024 Ilyce R. Glink and Samuel J. Tamkin. Distributed by Tribune Content Agency, LLC.