What is a Site Condominium?
A recent trend in developing a subdivision in Michigan is to establish a Site Condominium for the development. This can be confusing to buyers – who owns the land under the house? Why does a homeowner have to pay a condo fee? Who actually owns the house?
A builder or developer may choose to establish a Site Condo to speed up the building/development process or escape some building restrictions and red tape associated with platting a development. A Site Condo allows the developer to purchase the land, establish a Site Condominium with the township or city, divide the lots, install the roads, and quickly start building right away. The homes are usually Single-Family, detached homes.
Alternately, the other method of developing a subdivision could take years because a developer would have to submit plans for the subdivision then possibly wait months or years for township review, approval and recording, wait for the county road commission to install the roads, wait for the utility companies to install the water, sewer, electric and gas, etc. Instead of waiting for the city, township or county to build the infrastructure, a site condo developer can simply contract these services himself privately so he can get houses built (and sold) faster.
In a Site Condominium plan, the home buyers purchase both the home and the land under it, but all homeowners in the development share ownership in the common areas such as private parks, walkways, playgrounds, pools, clubhouses, etc. The site condo association typically collects a fee from each homeowner to maintain these common areas through Association or Site Condo Dues. Unlike a typical condo association, the homeowner is still responsible for maintaining the exterior of the property, mowing the lawn, taking care of the landscaping, etc. However, as a member of the association you are still expected to obey established rules of the association.
The development is typically governed by a homeowner’s association or maintenance company, and buyers can expect to move into a neighborhood with Covenents, Conditions and Restrictions (CC&R’s) or Bylaws designed to preserve, protect and enhance the property values of the neighborhood.
Some people are vehemently opposed to living within the guidelines of a homeowner’s association, while some people appreciate the benefits of having their neighborhood maintained in a uniform and orderly manner. As a home buyer, you should be aware of your obligations as a resident. It is a good idea for home buyers to request an opportunity to review and approve the bylaws prior to finalizing a purchase contract when making an offer on a home within a site condominium.