A condominium is the aggregate or collection of individual home units on a plot or parcel of land, where each such dwelling unit is separately owned individually but all the unit owners in the building or site jointly own the common areas and facilities.
A house owners’ association manages the condominium. The rules of such association provide for restrictions on condominium use including utilization of the common areas and facilities. Rules may contain provision for maintenance fee, color/ design scheme for the exterior, pet restrictions etc. Usually rules of house owners’ association of condominium permit letting out any unit on rent to the tenant but contain restrictions on leasing.
Different states have their own legislation on condominium.
In 1961 the Federal Housing Act allowed the Federal Housing Administration to insure mortgages on condominiums leading to phenomenal increase of fund inflow to this segment of the housing sector.
Condominium is different from a co operative where the corporation owns the dwelling units and every member own shares in the share capital of the corporation. By virtue of such shareholding a member is entitled to enjoyment and use of a dwelling units in a housing co operative.
Unlike a co operative, in a condominium individuals or members of the house owners’ association own the respective dwelling units personally. As such, they can freely transfer or dispose of the units without restrictions.
