Condo & HOA Glossary
Condo ownership comes with its own vocabulary. Here are the key terms you'll encounter in governing documents, HOA meetings, insurance policies, and real estate transactions.
A
- Assessment Cap
- A limit in the CC&Rs on how much the board can raise regular assessments in a single year without owner approval, typically 5–20%.
B
- Bare-Walls Coverage
- A type of master insurance policy that covers the building structure only — not interior fixtures, flooring, cabinets, or finishes. Owners must insure everything inside the drywall.
- Board of Directors
- Elected group of unit owners who govern the HOA. Responsible for budgets, maintenance decisions, rule enforcement, and hiring management companies.
- Bylaws
- The governing document that establishes how the HOA operates, including board elections, meetings, and voting procedures. Bylaws supplement the CC&Rs and focus on organizational structure. Learn more →
C
- CC&Rs (Covenants, Conditions & Restrictions)
- Covenants, Conditions & Restrictions — the master legal document that defines unit boundaries, common elements, owner and HOA responsibilities, and use restrictions. Recorded with the county. Learn more →
- Common Elements
- Parts of the property owned collectively by all unit owners and maintained by the HOA. Includes roof, foundation, exterior walls, hallways, elevators, parking structures, and amenities. Learn more →
- Condo Association
- The governing body of a condominium community, responsible for maintaining common elements, enforcing rules, and managing shared finances. Also called the HOA or homeowners association.
D
- Declaration
- Another name for the CC&Rs — the master document that creates the condominium and defines ownership boundaries, responsibilities, and restrictions. Learn more →
- Deductible (HOA Insurance)
- The amount the HOA must pay before insurance covers a claim. Can range from $5,000 to $100,000+. Many CC&Rs allow the HOA to pass this cost to the unit where the claim originated. Learn more →
- Deferred Maintenance
- Repairs or replacements that should have been done but were postponed, often due to insufficient reserves. A major red flag for buyers. Learn more →
- Due Diligence
- The process of reviewing HOA documents, finances, insurance, and legal status before purchasing a condo. Helps buyers identify risks like special assessments, underfunded reserves, and pending litigation. Learn more →
E
- Exclusive Use Common Area
- See "Limited Common Element." Some states and CC&Rs use this term instead.
F
- Fiduciary Duty
- The legal obligation of board members to act in the best financial interest of the association and all owners, not in their personal interest.
H
- HO-6 Insurance
- The standard insurance policy for condo unit owners. Covers interior improvements, personal property, liability, loss assessment, and additional living expenses. Learn more →
- HOA (Homeowners Association)
- The legal entity made up of all unit owners in a condo community. Governed by a board of directors. Responsible for managing common elements, enforcing CC&Rs, and maintaining financial health.
- HOA Fees (Assessments)
- Monthly or quarterly dues paid by each owner to fund HOA operations and reserves. Set annually by the board based on the operating budget.
I
- Improvement & Betterment
- Upgrades you make to your unit beyond the original builder specification (new kitchen, hardwood floors, custom bathroom). These are NOT covered by the master policy even under all-in coverage.
L
- Limited Common Element
- A common element assigned for the exclusive use of one or more units — but still technically owned by the HOA. Examples: balconies, patios, parking spaces, storage units. Maintenance responsibility is often split or shifted to the using owner. Learn more →
- Loss Assessment Coverage
- An HO-6 policy endorsement that covers your share of an HOA insurance deductible or uninsured loss. Critical when master policy deductibles are high. Learn more →
M
- Master Insurance Policy
- The insurance policy purchased by the HOA to cover the building structure and common areas. Comes in three types: bare-walls, single-entity, and all-in. Learn more →
- Meeting Minutes
- Official records of HOA board meetings. Reveal past decisions, ongoing disputes, planned projects, and the overall health of HOA governance. A key due diligence document for buyers. Learn more →
O
- Operating Budget
- The HOA's annual budget covering regular expenses like maintenance, insurance, management fees, utilities, and landscaping. Does not include capital reserves.
P
- Percent Funded
- A measure of how much money the HOA has saved in reserves compared to what it should have based on the reserve study. 70%+ is generally considered adequate; below 30% is a red flag. Learn more →
- Plat Map
- A recorded survey document showing the physical boundaries of each unit and common elements. The definitive reference for where your unit ends and common elements begin.
- Property Manager
- A professional or company hired by the HOA board to handle day-to-day operations including maintenance coordination, financial management, and rule enforcement.
Q
- Quorum
- The minimum number of owners (or their proxies) required to conduct official HOA business at a meeting. Typically 25–51% of all owners.
R
- Resale Certificate
- A disclosure package the HOA provides when a unit is sold. Includes financial statements, pending assessments, violations, insurance info, and CC&R amendments. Required by law in most states.
- Reserve Fund
- Money set aside by the HOA for future major repairs and replacements (roof, elevator, painting, paving). Funded through a portion of monthly assessments. Learn more →
- Reserve Study
- A professional analysis of all major common-element components, their remaining useful life, replacement cost, and a funding plan to pay for them. Should be updated every 3–5 years. Learn more →
- Responsibility Chart
- A document mapping each building component to the responsible party (HOA, owner, or shared). Reduces disputes and provides a clear reference for maintenance decisions. Learn more →
- Rules & Regulations
- Board-adopted rules that supplement the CC&Rs and bylaws. Cover day-to-day matters like noise, pets, parking, and architectural modifications. Can be changed by board vote without owner approval.
S
- Separate Interest
- The legal term for an individual condo unit — the portion of the property owned exclusively by one owner. Boundaries are defined in the CC&Rs. Learn more →
- Single-Entity Coverage
- A master policy that covers the building structure plus original interior fixtures and finishes as built by the developer. Does not cover owner improvements.
- Special Assessment
- A one-time charge levied on all owners to fund a major expense not covered by reserves — roof replacement, plumbing overhaul, legal settlement, etc. Can range from hundreds to tens of thousands per unit. Learn more →
- Studs-In / Studs-Out
- Refers to how the CC&Rs define the unit boundary. "Studs-in" means the owner is responsible from the wall studs inward. "Studs-out" means the HOA is responsible for everything outside the interior wall surface.
- Subrogation
- The process where an insurance company recovers costs from a responsible party after paying a claim. In condos, the HOA's insurer may subrogate against an owner whose negligence caused damage.
T
- Transition Period
- The period during which the developer retains control of the HOA before turning it over to unit owners. Buyers should be cautious during this period as the developer may prioritize sales over reserves.
U
- Unit
- The individual space owned by a condo owner. Boundaries are defined in the CC&Rs and typically include interior surfaces, fixtures, and appliances within the defined space. Learn more →
- Unit Boundary
- The legal line between your individually owned space and the common elements. Defined in the CC&Rs and plat map. The three main conventions are bare-walls, studs-in, and interior finished surface. Learn more →
Workbook
Want everything in one place?
The CondoWorkbook combines the responsibility matrix, due diligence checklists, maintenance trackers, and board question scripts into one printable PDF you can mark up and keep ($19).
View the Workbook