Common-area inspections

A transition study is not a reserve study

Most boards already know to order a reserve study before turnover, a funding plan that estimates the remaining life and replacement cost of common components so the association can set assessment levels. A transition (or turnover) study asks a different question: not what will it cost, but was it built right.

"Design, construction, or code-related issues that could impact the association's future management and financial well-being."

Source: Condominium Transition and Turnover Studies: Inspections, Reports, and Capital Reserve Analysis, VERTEX

A board that only commissions a reserve study can walk out of turnover believing its buildings are financially planned for, without ever learning whether the roof was installed correctly or the parking structure was built to spec.

What the inspection should cover

A thorough transition inspection walks every shared system the association will be responsible for once the declarant is out of the picture: roofs, HVAC equipment, parking lots and structures, elevators, and shared utility lines, in addition to structural components. The findings feed two things at once: a repair and replacement forecast, and a record of what might later support a construction-defect claim against the developer.

"A unit and the common elements in the condominium are suitable for the ordinary uses of real estate of its type."

Source: Implied Warranty of Habitability: Key Insights for New Construction Condominiums in Illinois, Illinois Condo and HOA Law Blog (Kovitz Shifrin Nesbit)

Some states recognize this kind of warranty over common elements themselves, not just individual units; others limit it to units, or don't recognize it at all. Ask a construction-defect attorney licensed in your state whether it applies to what your inspection finds.

Florida's mandatory version, and why it doesn't apply everywhere

Florida enacted a specific inspection mandate after the 2021 Surfside condominium collapse. Buildings of three or more habitable stories must undergo a structural milestone inspection.

"By December 31st of the year in which the building reaches 30 years of age."

Source: 2023 Legislative Update: Milestone Inspections, Structural Integrity Reserve Studies, Reserve Funding and Other Items, Falk Law Firm, P.A.

The same reform tied reserve funding to a linked Structural Integrity Reserve Study for these buildings, and owners in that category can no longer vote to waive or reduce that specific funding, a departure from the older rule that let owners waive reserves generally.

Most states have no equivalent inspection mandate. Check your own state's condominium or common interest community act, and your declaration, before assuming a law requires this study; where none exists, the board can still choose to commission one as best practice.

Why timing matters

Inspection findings are only useful if the association can still act on them. A declarant that sells its remaining units and transfers its special declarant rights to a new company is not automatically released from what happened before the sale; the recorded transfer instrument does not erase liability that arose earlier. Separately, construction-defect claims run against a deadline that can be a statute of limitations, whose clock starts when the defect is discovered, or a statute of repose, whose clock starts on a fixed event like substantial completion, regardless of discovery.

"No action may be brought to recover under this title more than 10 years after substantial completion of the improvement."

Source: California Civil Code, section 941, California Legislative Information

Your state's period, and the event that starts its clock, are almost certainly different from California's ten years. Have a construction-defect attorney check your state's deadline well before you assume there's time left.