For the tenth straight month, real estate transactions continue to trend positively in Massachusetts.
Specifically, condominium and single-family home sales in Massachusetts are going up. On March 13, the Massachusetts Association of Realtors reported that sales of condominiums have been increasing since the same time in 2011, and that the number of condominiums under agreement in February 2012 is up 35.3 percent compared to February 2011.
Given that condominium buyer confidence is on the rise, it seems timely to review the relevant documents involved in the sale of a condominium.
· Offer to Purchase - the instrument used by the potential buyer to extend an offer to purchase the condominium (or home); the buyer can accept the offer or counteroffer with an alternative set of terms
· Purchase and Sale Agreement (P&S) - the instrument executed by both the potential buyer and seller which sets forth the material terms of the transaction, including sale price, deposits, closing date, contingencies such as cash due at closing and the buyer obtaining mortgage financing, and disclosure of other pertinent information
· Rider / Addendum / Exhibit - a document sometimes attached to the Purchase and Sale Agreement that further explains or outlines terms contained within the P&S, such as the property description or deadline extensions; these are added either at the time of signing the P&S or afterwards, but only upon mutual agreement of the buyer and seller
· Declaration of Trust -the instrument that created the condominium association responsible for undertaking the day-to-day operations of the condominium
· Master Deed - the instrument that originally "created" the condominium by submitting the underlying land and buildings to the provisions of M.G.L. c. 183A; it is the governing instrument for the condominium, including provisions for unit dimensions, common areas, voting authority, amendment procedure, fees and other pertinent provisions
· By-Laws - these can either be a separate document or part of the Declaration of Trust, and they provide additional rules and regulations governing the condominium units and common areas, such as whether pets are allowed or whether units can be rented out
· Unit Deed - this is the instrument that will transfer ownership from the buyer to the seller, and typically indicates the boundaries of the unit and designates exclusive use common areas (either directly or through reference to the Master Deed)
· Plans - there should be available a set of plans depicting the common areas of the condominium as well as the individual unit being purchased, including exclusive use common areas
Moreover, in instances where the condominium is located on Registered Land, prior Land Court approval may be needed for some documents in advance of the conveyance (i.e. first unit deed or amendments to plans or Master Deed). To ensure that the buyer's interests are fully protected, a careful review of condominium documents by competent real estate counsel is recommended before the sale is finalized.
For an in-depth resource about the many aspects of condominiums, check out New England Condominium's website.
Written by Kristen M. Ploetz, Blog Editor
Copyright (c) 2011-2012 by Jeffrey T. Angley, P.C. All rights reserved.