Many wonder whether they should buy or not. Some people are not sure and decide not to buy an old one and buy a new one, but it would be a shame to exclude it from the list of options just because it is “old.” In the following, we would like to briefly introduce how to find an older condominium which can be considered “good to buy.”
Is the building ok? ~ Choosing a property with many renovated resale properties
Many people who are concerned about older condominiums are concerned about the life expectancy of the building. Many of the reasons why condominiums are being rebuilt are not due to the lifespan of the concrete or steel frame, but rather to the lifespan of the “equipment, facilities,” and other components. Problems such as plumbing that is embedded in the concrete and difficult to update, or built-in air conditioning system which is expensive to repair and restore, all add up to the inability to maintain a comfortable living environment and lead to rebuilding. It is best to avoid such properties if possible.
A good way to identify a property with no or few problems with the structure is to see if renovated properties are on the market. Properties that are being sold as “renovated properties” are those that have been selected by the purchase and resale business as being suitable for renovation work.
Properties that can be renovated can outlast the building, have a lower financial burden, and attract new owners and residents, so their property values are less likely to decline. It is fair to say that the key to choosing an older condominium depends first and foremost on whether or not it can be renovated.
Is the management okay? ~ Choose a property with an active and functioning board of directors in the HOA
However, large-scale repairs and rebuilding will eventually have to be carried out. It is an important point in selecting an older condominium to check whether or not a repair reserve fund has been properly set aside for such repairs. It is always a good idea to check the amount of money set aside is commensurate with the number of units.
However, no matter how much money is accumulated, the home owner’s association must reach a consensus in order to actually proceed with large-scale repairs and rebuilding. For this purpose, it is important the home owner’s association is functioning well and in order. For older condominiums, you want to choose a property where it is “easier” to reach a consensus across the entire condominium.
Checkpoints include the number of board meetings, the attendance rate of board members, the content of the agenda for general meetings, and the frequency of amendments to the management regulations. By looking at these points, it is possible to determine whether the home owner’s association is functioning well or whether it is a mere skeleton. If the association is functioning well, it is worth considering purchasing, but if the management rules have not changed much since the property was sold and remain flimsy, it is best to avoid the condominium on the assumption that serious discussions about the building are not taking place.
Is the location okay? ~Choose a location that is in high demand as a residential area
In the extreme, if the location is good, the older condominium is a good buy. Conversely, a condominium in a bad location is not recommended, no matter how well managed it is.
As the building ages, there will eventually be talks of rebuilding. At which time, older condominiums in a good location, or in other words, in an area with high land prices, are likely to be able to generate a profit even if the rebuilding project is undertaken. They will not leave it alone as a source of work. In fact, it is nearly impossible for the home owner’s association to carry out reconstruction alone. If you can find a business that is willing to undertake everything from rights adjustment to planning, general contractor selection, etc., it is highly likely things will go smoothly.
On the other hand, in suburban areas with low land prices and areas served by bus services, new construction demand cannot be expected, and the work is less interesting for “professionals.” This is because it is more economically rational to build a new building than to demolish and rebuild an existing building, taking time and effort to build a consensus among residents. Thus, condominium associations are in a position to ask for experts.
We would recommend choosing a property in a good location, where rebuilding is easily foreseeable.
Original Article: 買って良い「築古マンション」の見分け方
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