Condominium

Key Takeaways

• Condominium ownership combines outright title to an individual unit, defined largely by its airspace, with an undivided percentage interest in the common elements.
• The common elements, such as the land, the roof, exterior walls, hallways, and shared systems, are owned by all of the unit owners together and are maintained by the association out of assessments.
• A condominium unit is real property, so it can be sold, mortgaged, insured, and taxed separately from every other unit in the project.
• In Washington, which statute governs a condominium depends on when the community was created: chapter 64.34 RCW for condominiums created after July 1, 1990, and chapter 64.90 RCW for common interest communities created on or after July 1, 2018.

What It Means

A condominium is a form of real property ownership, not a building type. The owner holds outright title to one unit, described in the declaration and the recorded plans largely as a volume of airspace bounded by the unit's walls, floor, and ceiling, plus an undivided percentage interest in the Common Elements shared with every other owner. The common elements are the parts no one owns alone: the land, the foundation and roof, exterior walls, hallways, elevators, and shared plumbing and wiring.

Because the unit is separately owned real property, it can be sold, financed, insured, and taxed on its own. Because the common elements are shared, an owners association manages them and charges regular assessments, with special assessments when a large repair outruns the reserves. A condominium is different from a Housing Cooperative, where a resident owns shares in a corporation and holds a proprietary lease rather than title to real estate. Condominium ownership therefore arrives with a set of governing documents that bind the buyer from closing forward.

How It Works in Washington

In Washington the chapter that governs a condominium depends on when the community was created, and a broker needs the vintage right before answering questions about owner rights. Chapter 64.32 RCW covers the oldest projects. Chapter 64.34 RCW, the Washington Condominium Act, applies to all condominiums created within this state after July 1, 1990 (RCW 64.34.010). Chapter 64.90 RCW, the Washington Uniform Common Interest Ownership Act, is the current law: before January 1, 2028 it applies to a common interest community created on or after July 1, 2018, and to an older community that amends its declaration to elect into it (RCW 64.90.360). That same section provides that chapters 64.32, 64.34, and 64.38 RCW do not apply to a community once chapter 64.90 governs it.

The resale duty is the part a broker touches on every listing. Under RCW 64.90.640 a unit owner must furnish the buyer a Resale Certificate before the contract for sale is signed. The association prepares it from its own books and records, and the buyer may cancel within five business days after first receiving it. A new unit sold by the declarant comes with a Public Offering Statement instead. Both documents put the association's finances and obligations in front of the buyer while there is still time to walk, which is why they belong in the transaction file rather than in a drawer.

Example

Priya buys unit 302 in a 40 unit Washington condominium built in 2004, so the community is governed by chapter 64.34 RCW rather than the newer chapter 64.90 RCW. Her unit carries a 2.5 percent undivided interest in the common elements, which is consistent across the project because 40 units at 2.5 percent is 100 percent. The association's annual operating budget is $240,000, so her regular assessment is 2.5 percent of that, or $6,000 a year, which is $500 a month.

Three weeks before closing the association levies a $600,000 special assessment to replace the roof and the siding. Priya's 2.5 percent share is $15,000. The roof is a common element, so no single owner can opt out and the charge follows the unit. Priya's broker reads the updated resale certificate, spots the levy, and negotiates a seller credit of the full $15,000 at closing. Her monthly cost after closing is still $500, because the special assessment is a one time charge and is not part of the operating budget.

Common Mistakes and Exam Traps

• Condominium describes ownership, not architecture. A detached house, a townhouse, and a commercial suite can all be condominium units.
• In a cooperative the resident owns shares in a corporation and holds a proprietary lease. In a condominium the resident owns real property and takes a deed.
• The unit boundary is generally the interior airspace. The roof, exterior walls, and land under the building stay common elements owned by all the owners together, even when one owner is the only person entitled to use a balcony or a parking stall.
• In Washington the governing chapter follows the creation date, so a 1985 project, a 2004 project, and a 2020 project are not all under the same statute.