You do bring up a great point, condo buyers must do their due diligence in regards to their review of the management of a condo’s HOA, maintenance/upkeep and funds. There are additional risks assumed by condo buyers in respects to deferred maintenance, under funded reserves, insolvent developers, etc.

Perhaps, the FHA guidelines will prompt more associations to be proactive in conducting reserve studies, but really, the law needs to be amended with an enforcement provision to be effective.

And friends in Washington State, especially, don’t let friends buy condos!

HUD insiders report that Washington State has the highest rejection rate in the country for FHA condo mortgage applications because of the inordinately high number of poorly funded associations….

As one HUD spokesperson (who wished to remain anonymous) put it recently;

“do those people even know what a reserve study is in Washington?”

Not only are Seattle area condos grossly overpriced but in the majority of cases the association is a financial train wreck just waiting to happen.

The 2008 law requiring condo associations is meaningless because the gutless Washington State legislature didn’t have the BALLS to write law with any enforcement tooth in it.

If you buy a condo in Washington you do so at your own risk.