The Daily Soak - August 25

Judge Denies Class-Action Status for Orlando Condo Lawsuit

Back in July, HB.com reported on the $20 million lawsuit filed against the developer of the 313-unit Paramount on Lake Eola in downtown Orlando. The lawsuit was filed by purchasers looking for a loophole to avoid taking possession of their units. Earlier this year the plaintiffs found out about the building's cracked foundation and argued they should have been notified and given the option to back out of their contracts. An Orlando judge has now rejected the class-action status of that lawsuit and ruled that each purchaser must fight the developer, Zom Inc., individually. Attorneys for Zom applauded "the judge's rejection of the class-action request because it clears the way for other buyers to close on their purchases and move into the building." A 1,200 square foot, 2bed/2bath unit in the Paramount is listed on Trulia for $460,000, or $387 per square foot. (July 7 Video)



Boca Project: "When Bad Things Happen To Good Condos"

A stalled condo conversion project in Boca Raton will revert back to an apartment complex according to Ceebraid-Signal, the West Palm Beach developer. Like many projects, the 212-unit apartments were converted to condos during the housing boom, but the project stalled, according to the Palm Beach Post. "The four-building project has sat, unfinished, with two buildings completed and the other two incomplete. Little to no construction work has taken place during the past year. The two boarded-up buildings serving as a constant reminder - and eyesore- of when bad things happen to good condos." Eden resident and local teacher Kathleen Callaghan can't wait to give back her $393,000 condo. "They can turn it into an amusement park," Callaghan said. "I don't care. Just let me go." Callaghan may not get her wish as quickly as promised. Her closing date was just moved from August to September and, according to the Post, "financing remains tricky" for the developer. (Google Map)



Buying A Condo? Better Do Your Homework First

AP published a checklist of good advice for those considering a condo purchase. The author of Tips and Traps When Buying a Condo, Co-op, or Townhouse warns "The biggest single mistake that people tend to make is to think that buying a condo is just a less-expensive way of buying a house and not really understanding that it's shared ownership, which is a lot different." The first priority should be finding out about monthly HOA fees and the likelihood of special assessments in the near future. Next, buyers are encouraged to ascertain the number of unsold or investor-owned units in a condo, because high percentages can be a red flag for lenders. "Banks typically won't finance or will charge a premium to finance a unit in a building where 40% or more of the units are rentals." Finally, find out about the financial status of the condo's developer and make sure any deposit monies are placed in escrow.