Sample Condominium Agreement

In a condominium, your neighbors are also fellow members of your condominium association. Unlike neighbors in single-family homes, neighbors in your condo often have the legal authority to limit how you use your unit. For example, you may be prohibited from establishing a home-based business in your apartment. You may need the prior consent of the board of directors.

Similarly, it's legal for members of a condominium association to agree on real property issues. They may agree that no owner will sell their unit without giving written notice to the association. Known as a right of first refusal, the notice may give other members the opportunity to purchase the unit. The following is a sample agreement addressing this issue. Its provisions may be limited by laws in your state, so check with your attorney when drafting such an agreement.

Condo Right of First Refusal Agreement

Unit Owner ___ ("Owner") hereby agrees and covenants to be bound by the following provisions hereto. This is regarding the sale or lease of ___ [address including unit number] ("the Unit"). The Unit is in ___ [name of condominium] ("the Building"):

When Unit Owner decides to sell or lease the Unit, Unit Owner will provide the Building Association with no less than ___ days' notice.

When Unit Owner obtains an outside offer for sale or lease of the Unit:

1. Unit Owner will provide the Building Association and every other unit owner in the Building with notice of such offer,
2. Including the purchase price, name, address and telephone number of the prospective buyer,
3. The terms and conditions of the proposed sale or lease, and
4. Such other information as the Building Association requires

Upon receipt of any such outside offer:

The Owner agrees to offer to sell or lease the Unit to any other owner of a unit in the Building or the Building Association itself. The sale or lease shall be on the same terms and conditions as those of the proposed sale or lease.

Within ___ days of such notice to the Building Association and every other unit owner in the Building:

1. The Building Association and all unit owners will decide whether to purchase the Unit and
2. Will notify the Unit Owner of the same

The Building Association shall have the right of first refusal of:

1. The terms and conditions for
2. Purchase or lease of the Unit

If the Building Association does not wish to purchase or rent the Unit:

1. Each of the Building's unit owners shall have the right of refusal to purchase or rent the unit
2. On the same terms and conditions as the outside offer,
3. In order of the length of time each has been a member of the Building

If, after ___ days, neither the Building Association nor any other unit owner in the Building notifies Unit Owner of the desire to purchase or rent the unit:

1. Unit Owner will be free to sell or lease the Unit to any outside purchaser or tenant
2. On the same terms and conditions of the original offer,
3. Provided that the outside purchaser or tenant agrees to comply with all other rules and regulations of the Building
4. As set forth in the By-Laws of ___ [date of By-Laws]

If the Unit Owner fails to comply with the terms of this Agreement governing sale or lease of the Unit set forth herein, the transaction in violation of this Agreement is voidable upon action of a majority of the members of the Building Association.

Dated:_______________

__________________________________________[name of Unit Owner]

__________________________________________[name of Building Association representative]

Purchase Agreements

When you're purchasing a condominium unit, you'll need a written agreement to become a homeowner. The provisions of this contract will discuss important built-in terms, including:

• Purchase price, down payment, and earnest money deposit
• Which title company and escrow company to use, and how many days to keep escrow open before the closing date
• Whether the buyer will be using a lender to finance their purchase
• Prorations for transaction costs between the buyer and seller, e.g. closing costs
• Warnings about paint hazards, lead-based paint, and other environmental harms
• Disclosure affidavits regarding easements and liens (encumbrances) and local laws like ordinances and occupancy restrictions
• Information regarding title insurance, warranties, waivers, and real estate brokers and realtors used in the transaction

If the parties forget to put everything in the initial contract, they can create an addendum to input additional terms. For example, notwithstanding applicable laws, a seller may want to give more time to a good faith buyer to perform the sale contract. Perhaps the buyer needs more business days to obtain a mortgage loan. But if a buyer is purposefully dragging the same, the seller's attorney may file a complaint in court.

Because a real estate purchase agreement is a binding contract, failure to complete the purchase can have legal consequences. That means the seller can force the buyer to forfeit their earnest money deposit or commit to specific performance. If the buyer loses the case, they may also be required to pay the seller's reasonable attorney's fees. But if the buyer has a good excuse to get out of the purchase, the court may elect to cancel the contract.

Need Your Agreement Reviewed?

Contracts come in all shapes and sizes. The template above is only an example of what you can expect. You may have trouble understanding an agreement. You may also need assistance with drafting one. In these situations, consider working with a legal professional. A real estate attorney can give you legal advice about condominium agreements and more.