Jessica Martinsen · Austin Real Estate
Buying a condo in Austin: read the association before you love the unit
The Texas resale certificate, what HOA finances reveal, the master-policy insurance gap, and why lender condo approval can sink a deal late.
A condo purchase is two purchases: the unit, and a stake in an association whose finances, rules, and litigation history you inherit at closing. Texas law gives you the tool for the second purchase - the resale certificate, a statutory disclosure package the association must produce, covering its budget, reserves, fees, special assessments, insurance, owner-occupancy levels, and any lawsuits. It arrives with a review window, and reading it is not optional homework; it is the inspection report for the 90% of the property you cannot see from inside the unit.
Read the money pages in a specific order. Reserves first: a tower with weak reserves and an aging roof, elevators, or a chiller plant has a special assessment in its future, and recent history elsewhere has made underfunded high-rises a national underwriting concern. Then the fee history: dues that never rose for a decade usually mean deferred maintenance, not efficiency. Then assessments already levied or contemplated, and finally litigation - construction-defect suits are common in buildings from certain eras, and while a suit can end with the building fixed, an active one can make units temporarily hard to finance at all.
The insurance structure has a gap buyers routinely miss. The association's master policy covers the building's shell and common elements, in one of two flavors: bare-walls coverage, which stops at your drywall, or all-in coverage, which includes original interior finishes. Your personal HO-6 policy must fill whatever the master policy leaves out - interior improvements, your contents, your liability, and critically, loss-assessment coverage for your share of a major building claim and the master policy's deductible, which in hail country can be enormous. Match the HO-6 to the actual master policy, not to a generic checklist.
Financing a condo means the building gets underwritten alongside you. Conventional lenders check whether the project is warrantable: enough owner-occupants versus renters, no single investor holding too many units, healthy budget with adequate reserve contributions, limited commercial space, no disqualifying litigation. A non-warrantable building does not make the unit unbuyable - it moves you to portfolio loans at worse terms. Ask your lender to pre-screen the specific building during the option period rather than discovering the problem in week four, and note that the same review protects you: what makes a lender nervous should make you curious.
Fit the building type to the actual life. Downtown towers price in amenities, staffing, and views through fees that can rival a car payment - fine if you use what you are paying for. Garden-style communities and the townhome-shaped condos scattered through the older neighborhoods carry lighter fees and more privacy but fewer services; note that legal form matters more than shape, since a 'townhome' may be a condo regime in which you own airspace or a fee-simple lot where you own the ground, with different insurance and financing consequences. In every case the association's minutes for the last year tell you what daily life there is actually about - request them along with the certificate.
Common questions
- What is a resale certificate?
- A statutory disclosure package the association must provide to a Texas condo buyer: budget, reserves, fees, special assessments, insurance, occupancy, and litigation. It comes with a review window - read all of it, and treat weak reserves plus old big-ticket components as a forecast of assessments.
- What insurance do I need beyond the association's master policy?
- An HO-6 unit-owner policy sized to the master policy's actual structure - bare-walls versus all-in - plus contents, liability, and loss-assessment coverage for your share of major claims and the master deductible.
- Why did my lender reject the building rather than me?
- Conventional loans require a warrantable project: owner-occupancy levels, investor concentration, reserves, and litigation all count. Non-warrantable buildings push financing to portfolio terms. Have the building screened early in the option period.
- Are condo fees wasted money compared to a house?
- They prepay the roof, structure, insurance, and amenities a house owner pays for irregularly. The honest comparison is fees versus your real standalone maintenance, insurance, and time - the failure mode is not fees existing, it is fees that were kept artificially low.
- Is a townhome a condo?
- Sometimes. The shape does not decide it - the recorded regime does. A condo-regime townhome means you own airspace and share the rest; fee-simple means you own the land. Financing and insurance differ, so confirm which one the listing actually is.
This page is a planning guide, not a market report. Confirm current prices, taxes, insurance and property facts against authoritative sources before acting on them.
Ask Jessica Martinsen about Buying a condo in Austin: read the association before you love the unit