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The Condominium lease agreement is a legally binding document that’s entered into between the condo’s owner and the renter or tenant. Like a standard lease agreement, it outlines the terms between the parties. The difference is that the tenant will also have to abide by the rules of the association that oversees the complex.
Apart from that, the tenant will be treated in a similar way to the landlord in that they’ll have the ability to use all the common areas, built-in facilities, and other benefits. Of course, this could be removed by the terms of the agreement but is extremely rare. One thing to note is that the association dues are usually paid by the landlord and not the tenant.
A condo is unique because it’s a single unit within a complex or development of similar units that share ownership rights of common areas with other condos in the development. The units are owned by individuals instead of a company that rents them out to tenants. This is most common in high-rise buildings with the top floors almost always being owned by individuals.
Every unit is responsible for paying a condo association fee that is used to maintain the property as a whole, upgrade or fix things in the common areas, and pay salaries for the staff of the building. As mentioned previously, the landlord /owner is responsible for paying the association fees - not the tenant. ”
Like other types of properties that are rented out, each state has laws in place to govern the relationship between tenants and landlords. Once your condo is rented out, you automatically become a landlord which means you have to stay compliant with the laws in your state.
In addition to the state laws, there may be local laws that need to be taken into consideration. For example, does your rental property need to be registered with the city? Is there a maximum amount you can charge as a security deposit? What’s the eviction process? These are important things to understand so that you won’t’ encounter unforeseen circumstances that will be costly to handle.
Condo associations do more than maintain the property. Each association has its own rules governing the conduct of its members. Some of them refuse rentals completely, others limit it to a certain percentage and you’ll need to formally request permission, and some don’t care.
Even associations that allow tenants may have certain requirements such as interviewing prospects and making them register with the association. Each one is different so make sure you’re clear on all the protocols before starting your search for a tenant.
You may want to engage the services of an agent to help you find prospective tenants. They’ll do most of the legwork and take a cut of the rent paid or a flat fee. Conversely, you can advertise it yourself and set up a screening process. The screening process is important because the Fair Housing Act governs discrimination related to race, color, sex, etc. Make sure that everyone goes through the same screening process, require a rental application (with a small fee to cover costs), and run a background check (criminal, rental history, and credit). That way, everyone has a level playing field and you’ll avoid any allegations of discrimination.
After the right tenants have been found, they’ll make a conditional offer or accept the one you present. From there, you’ll discuss other terms of the lease such as pets, utilities, etc. Only after both the landlord and tenant have hammered out all the details should the lease agreement creator be used (or you can download the template from this page). To execute, all parties should sign. A witness isn’t required but it may be a good idea to have one sign the agreement nonetheless.