HOA Detective – April 25, 2025: Across the United States, a significant shift is occurring in the condominium market. Mid- and high-rise condominiums constructed during the condo development boom from the mid-1990s until the subprime mortgage crisis are now reaching a critical age.
These buildings, now between 17 and 30 years old, are entering a phase where deferred maintenance, underfunded reserves, and evolving regulatory requirements converge, prompting what CIDAnalytics has termed the ‘Building Exodus.’
The 20-Year Tipping Point: A Lifecycle Milestone: Around the 20-year mark, buildings typically require significant investments to address the aging of essential systems and structures. Common projects during this period include:
- Re-roofing
- Elevator modernization
- Boiler replacement
- Plumbing system overhauls
- Exterior sealant and window replacements
These capital-intensive projects are often anticipated in reserve studies, which are long-term capital budget planning tools designed to ensure that sufficient funds are available when major repairs and replacements are needed.
The “New Car Honeymoon” Analogy: The behavior of first-generation condominium owners during the Building Exodus can be likened to that of new car buyers. Initially, owners enjoy a period of minimal maintenance and stable costs—the ‘new car honeymoon. However, as the building ages and significant repairs become necessary these owners may choose to sell their units to avoid the impending financial burdens, similar to a car owner who trades in a vehicle before costly maintenance is required.
