A condominium regime divides a property into individually owned units and common elements owned in undivided shares, governed by recorded documents.
The documents. A declaration creating the regime and describing units and common elements; a plat or plan; and bylaws governing the association. State condominium acts prescribe much of the content.
Percentage interests determine voting and the allocation of common expenses, and are typically based on relative value or area. They are difficult to change, often requiring near-unanimous consent.
Limited common elements are portions reserved to one or more units — balconies, parking, HVAC serving a single unit — and the maintenance responsibility for each should be stated explicitly.
Mixed-use regimes separating retail, office and residential components require careful allocation of shared systems and costs, separate voting on matters affecting only one component, and often a master association with sub-associations.
Assessments and liens. The association’s lien for unpaid assessments, and its priority relative to first mortgages, is state-specific and materially affects lender underwriting.
Reserves and studies. Statutes increasingly require reserve studies and funding, particularly after structural failures prompted reform. Underfunded reserves are a diligence item for any purchaser.
Developer control and the transition to owner control require careful drafting and a documented handover of records and warranties.