Co-ownership / condominium
The legal regime applying to a building whose ownership is split among several owners, each holding private units and a share of common areas expressed in thousandths. Governed by the law of 10 July 1965, the broker reviews the co-ownership's financial health (arrears, voted works, ALUR reserve fund) as it can affect asset value and the bank's lending decision.
Key points
- Governed by the law of 10 July 1965 and the building's co-ownership regulations.
- Each owner holds a share of common areas proportional to their lot.
- The property manager (syndic) manages the building and votes on works at general meetings.
- The co-ownership's financial health (arrears, voted works) conditions the bank's decision.
Frequently asked questions
Why does the broker systematically analyse the co-ownership's financial situation?
High arrears or major voted works not yet funded can reveal a struggling co-ownership, exposing the buyer to unexpected additional charges. Banks factor these risks into their assessment: a co-ownership under provisional administration can lead them to decline or limit financing.
How can a buyer verify a co-ownership's financial health before purchasing?
The seller must include in the sale file the last three AGM minutes, the co-ownership regulations, the état daté (unit accounting statement), and the ALUR reserve fund balance. These documents reveal voted works, ongoing disputes, and current charge levels. An experienced broker examines them systematically.
What is the ALUR reserve fund and why does it matter to a buyer?
The 2014 ALUR law made it mandatory to build a reserve fund (fonds travaux) annually funded by co-owners, intended to anticipate major maintenance expenses. A well-funded reserve means future works can be financed without special assessments. An empty or near-empty fund is a warning signal for the buyer.
In practice
A buyer wants to purchase a flat in a 1975 building. The broker reviews the AGM minutes and finds that a €180,000 façade renovation has been voted but not yet funded. They alert the buyer to expected special assessments and propose renegotiating the price.
Official sources
- Co-ownership regulations · Service-Public.gouv.fr
- Buying a condominium dwelling · Service-Public.gouv.fr
- Sale agreement and loan condition precedent · Service-Public.gouv.fr