Most Boston condo buyers receive several hundred pages of association documents, forward them to their attorney, get back an email saying nothing unusual, and close. The attorney is checking for legal defects, which is their job. Nobody is checking whether the building is going to hand you a twenty-eight thousand dollar assessment in three years, because that is not a legal defect. It is a financial forecast, and it lives in documents that read like nothing.

Here is what to actually look for, in the order that matters.

Number one: reserves per unit

Find the balance sheet. Find the reserve account balance. Divide by the number of units.

That single figure tells you more than any other line in the package. A fifty-unit masonry building from 1910 with a reserve balance of forty thousand dollars has roughly eight hundred dollars per unit set aside against a roof, a facade, a boiler, and an elevator. That building is not funded. It is a special assessment with a lobby.

There is no universal correct number, because it depends entirely on what the building still has to replace and when. Which is why the balance alone is not the answer. It is the question that leads to the next document.

Number two: the reserve study, or its absence

A reserve study is a professional assessment of every major building component, its remaining useful life, and its replacement cost, mapped against what the association is currently saving. It tells you when the money is needed and whether it will be there.

If the association has one, read the funding percentage and the schedule of upcoming components. If the association does not have one, that is itself the finding. A well-run Boston association with significant deferred capital exposure commissions a reserve study. One that has not is either very small, very new, or not thinking about it. Ask which.

Number three: fee history over five years

Do not look at the current fee. Look at the trajectory. Pull the last five budgets and calculate the annual increase.

A fee compounding at seven percent a year doubles in about a decade. That matters to you in two directions. It is your carrying cost, and it is also what your eventual buyer will underwrite. A buyer qualifies against a total monthly payment, so every dollar of fee growth reduces what someone can pay you for the unit later. Roughly two hundred dollars a month of fee difference translates to something on the order of thirty thousand dollars of purchasing power at current rates.

Also check what the fee covers. A building where the fee includes heat and hot water is not comparable to one where it does not, and listing sheets rarely make this clear.

Number four: insurance

This has become the fastest-moving line in Boston condo budgets. Master policy premiums on older masonry buildings have risen sharply, and some associations have absorbed the increase by raising the master policy deductible rather than the fee.

That shift moves risk onto you. A high master deductible means that when something happens, the association's policy pays less and unit owners cover more, either through the association's loss assessment provisions or out of pocket. Ask for the current master policy declarations page, the deductible, and whether the association has had a claim in the last five years. Then ask your own insurance agent what your HO-6 policy needs to look like given that deductible.

Number five: the minutes

Twelve to twenty-four months of board meeting minutes. Not the newsletter. Not the annual letter from the trustees. The minutes.

This is where the capital conversation actually happens before it becomes an assessment. You are looking for engineering studies commissioned, contractors interviewed, phrases about the facade, the roof, the elevator, the windows, the parking structure. A project mentioned three times in minutes across a year is a project, whether or not it has been voted.

You are also looking for conflict. Litigation, disputes with a developer, unpaid fees, a unit owner in arrears, disagreements about rentals. A building where owners are fighting is a building where decisions get delayed and costs rise.

The documents to request, as a list

• Master deed and any amendments
• Declaration of trust and bylaws
• Current budget and the prior three to five
• Balance sheet and reserve account balance
• Reserve study, if one exists
• Board meeting minutes, twelve to twenty-four months
• Master insurance policy declarations, including deductible
• Any special assessment history and any assessment currently under discussion
• Rules and regulations, particularly on rentals, pets, and renovations
• The six D certificate, which is the seller's obligation and certifies no unpaid fees on the unit
• Percentage of units that are owner occupied

That last one is not just a lifestyle question. Lenders care about owner-occupancy ratios, commercial space percentages, and whether any single entity owns too many units. A building that is fine for a cash buyer can be unfinanceable for the next person, and that is a resale problem you inherit.

How to protect the review in your offer

Massachusetts offers move fast and buyers get pushed to waive things. A condominium documents contingency giving you a defined window to review and withdraw is reasonable, and a well-run association does not object to producing its documents.

If you are in a competitive situation and cannot keep the contingency, ask the listing agent for the documents before you write. Plenty of Boston listing agents have the package assembled and will send it. Reviewing before you offer is the version of due diligence that costs you nothing competitively.

If you already own

Every one of these is a question about your own building, and most owners have never asked them. If your association has a facade or elevator project moving toward a vote, the difference between selling before it is voted and after it is disclosed is real money. Once an assessment is voted, buyers price it at full value plus a risk premium for the possibility it runs over.

That is not a reason to panic. It is a reason to know where your building stands, and knowing takes an afternoon.

Send me the address and unit number and I will pull what is publicly available and tell you what to request. If you are under agreement and have the package in hand, send it over and I will tell you what I would be worried about.

Chris Remmes, Managing Broker, Remmes & Co. [email protected] | 617-398-0015

General information about condominium due diligence in Massachusetts, not legal or financial advice. Have a Massachusetts real estate attorney review association documents before you commit.