Overview
Condo ownership comes with its own vocabulary, and understanding the key terms before you buy or while you own helps you navigate association decisions, budgeting, and potential disputes with confidence. This glossary covers the essential terms every Miami condo owner or buyer should know, from the basics of the association structure to financial concepts like reserve funds and special assessments.
Condominium
Other terms: Condo, apartment
A condominium is a type of ownership where individuals own a unit in a multi-unit building, along with a share of the common areas and amenities.
Unit Owner
An individual who owns a specific unit within a condominium building, with responsibilities and rights defined by the association's governing documents.
Homeowners Association (HOA)
Other terms: Condo association, the association
A condo association is governed by a board of directors made up of volunteer members elected by the owners. The board manages the building, sets the budget, hires property managers and contractors, and enforces the rules.
Board of Directors
Other terms: The board
Board members serve as fiduciaries for the owners, with a legal duty to act in the association's and its members' best interests. Serving on the board is also an opportunity for owners to take an active role in managing the building.
Common Areas
Other terms: Amenities
Shared spaces like hallways, elevators, pools, gyms, and rooftop terraces. Maintenance responsibility typically falls to the association, funded by monthly condo fees.
Condo Fees
Other terms: Association fees
Monthly fees covering maintenance, repairs, and other building expenses. The amount usually reflects unit size and the amenities and services the building offers, covering maintenance, utilities, insurance, property management, and reserve fund contributions. Review the fee breakdown carefully to understand where your money goes, and factor these fees into your overall budget before buying.
Reserve Fund
Other terms: Reserves
Funds set aside for major repairs and unexpected expenses, like a roof replacement or structural repair. A well-funded reserve reduces the likelihood of a sudden special assessment; an underfunded one increases it.
Special Assessment
A special assessment is a one-time fee covering expenses the reserve fund doesn't, whether from unexpected repairs, legal disputes, or a natural disaster. It may be due upfront or in installments added to your regular condo fees, and can represent a significant financial burden with limited notice. Reviewing the association's financial records and reserve funding regularly helps you gauge the likelihood of one coming.
Condo Financials
The association's financial records, including the annual budget, balance sheets, income statements, and cash flow statements. Reviewing these gives real insight into whether the association is managing its resources well.
Board Meeting Minutes
Records of board meetings, covering decisions like rule changes and planned maintenance. Access varies by association policy and state law, but these minutes are a valuable way to stay informed about your building's management.
Bylaws
Other terms: Rules and regulations
The association's governing rules covering common-area use, pet policies, parking, noise, and more. Review these carefully before buying, since violations can mean fines or other penalties.
Covenants, Conditions & Restrictions (CC&Rs)
Legal documents outlining owners' rights and responsibilities, covering maintenance duties, pet policies, parking, and common-area use. Violations can mean fines or legal action, and CC&Rs can be amended over time, so it's worth staying current on any changes.
Property Manager
Oversees day-to-day building operations — maintenance, repairs, and financial management — working under the board's direction. Often serves as the liaison between the board and owners for updates and concerns.
Right of Refusal
Some associations hold a right of refusal, giving the association or existing owners the first opportunity to purchase a unit before it goes to an outside buyer. Buyers should check whether this applies before making an offer, since it can affect timeline and price.
Condo Building Master Insurance
Insurance covering the building's physical structure, common areas, and related liability. Lenders typically require a minimum coverage level before approving a loan on a unit, to protect their investment.
