Is Your Buyer in Love with a Tall and Skinny? Here’s What You Need to Know
The start of the year is the time for dreaming big. For many, that means finding (and hoping to purchase) their new home. Your Nashville real estate clients want elegance, modern amenities, and convenience, ideally situated in growing neighborhoods like East Nashville or The Nations.
Translation: they are in love with a Tall and Skinny, also known as Horizontal Property Regimes (HPRs). These appeal to many buyers and are full of opportunities for realtors. But even proactive buyers may not find everything they need to know in a listing. That’s where your title attorney is valuable. Here’s what you need to know to help clients make an informed decision when looking for their dream home.
Is it a PUD or a Condo?
The main difference between a HPR and a Condo is who owns the land. Homeowners own the land on which a HPR is built, while a Condo Association owns the land in the latter. You must review the Master Deed site plan and definitions. Your client needs a clear understanding of their responsibilities, and the extent of their ownership/autonomy related to the property.
What are Three Types of Elements that Make Up an HPR?
A horizontal property regime consists of three elements: private elements, limited common elements, and common elements.
Private elements are the housing unit itself.
Limited common elements are the area surrounding the Private element, usually the yard and grounds around the Private element.
Common elements are the parts of the HPR that are owned by the association and are owned jointly by all the owners of the units.
Not all HPRs will have common elements such as shared walls or shared driveways.
Each of these elements is detailed and indicated on the site plan, found in the Master Deed.
It’s very important that your Tennessee title attorney explain exactly what your client is purchasing so they fully understand their responsibilities and ownership.
One of the biggest snags involving the HPR is the fact that the Association must be incorporated; even though, there are not any common elements. The homeowner must maintain the existence of the corporation by paying an annual $20 fee to the state as it is established with the initial filing when the HPR is created.
Further, if there are common elements, there are possible property taxes that are owned by the Association. Although minimal, these taxes need to be paid by the property owners. These taxes are not included in each unit’s property taxes. Even if there are no common elements, there will still be a map and parcel assigned to it by the county assessor.
Your Expert Partner for Tall and Skinny Real Estate
Your due diligence is what helps your client land their dream home, and avoid nightmares. Working with a trusted partner will give you peace of mind. Title law is our main riff. As Nashville’s HPR experts, we’re committed to keeping you, your client, and the title protected. Contact Blue Note Title today to request a free consultation.
