Seller Guide
The statutory document package a condominium seller must produce, and the building-level issues that decide whether a buyer's loan closes.
Selling a condominium is a different exercise from selling a house, and the difference is not the square footage. A house seller discloses what they know about their property. A condominium seller must also produce a statutory package of documents about a building they do not control, prepared by an association on its own timetable, describing finances, litigation, reserves and repairs that the seller may know very little about. The house is only half of what the buyer is diligencing. The other half is the association, and in Los Angeles it is the other half that most often decides whether a sale closes on time, closes late, or does not close.
That has become more true rather than less over the past few years. Statutory inspection obligations now attach to balconies and elevated walkways in California condominiums. Lender project standards tightened after the Surfside collapse and have continued to move, with significant changes announced during 2026 that alter which projects are reviewable and how reserves are assessed. A building with underfunded reserves, an open critical repair, an unresolved lawsuit, or simply a management company that answers questionnaires slowly can make an otherwise straightforward unit unfinanceable for a substantial part of the buyer pool.
This guide sets out what you must produce, what buyers and lenders will look for inside it, and how to sequence the request so that the association's timetable does not become your escrow's timetable. It also covers the Los Angeles-specific layers, from Measure ULA to the City's own pre-sale report to the question of a tenant in occupation, and it flags the two ownership structures, ground leases and stock cooperatives, that this city has more of than most. It is not legal, tax or financial advice. Where the answer turns on your building's own documents, that is a question for a California community association attorney and your own counsel.
California's Davis-Stirling Act places the obligation on the seller. Under Civil Code Section 4525, an owner of a separate interest must provide a prospective purchaser with a defined list: all governing documents; a statement about any age-restricted occupancy limitation under Section 51.3; the annual disclosures distributed under the relevant article; a written statement from an authorised representative of the association as to the amount of current regular and special assessments; copies of unresolved enforcement notices sent under Section 5855; construction defect information under Sections 6000 and 6100; notice of any assessment change approved by the board but not yet due; a statement describing any provision restricting rental of the unit; and, if the purchaser requests it, board meeting minutes for the previous twelve months.
The association's role is to supply those documents on request, and its obligations are also statutory. Under Civil Code Section 4530 the association must provide the requested documents within ten days of the mailing or delivery of the request. It may charge a reasonable fee based on its actual costs of procuring, preparing, reproducing and delivering them, but may not charge more for electronic delivery, and may not withhold delivery for any reason or condition other than payment of those fees. Section 4528 prescribes a document disclosure form on which the association sets out a written or electronic estimate of those fees.
Two practical points follow. First, ten days is the association's outer limit, not a target, and in practice the request often routes through a management company and a third-party document vendor, each with their own queue. Second, the seller pays. Build both into the plan by ordering the package at the point you sign the listing agreement rather than at the point you accept an offer. A seller who can hand a complete, current package to a buyer's attorney on day one of escrow has bought themselves a materially faster and calmer transaction than one who orders it in week two.
Experienced buyers do not read the package front to back. They go straight to a short list. The reserve study and the reserve balance, because they indicate whether the next major repair will arrive as a planned expenditure or as a special assessment. The current budget and the assessment history, because a long run of flat dues in an ageing building is a warning rather than a comfort. The minutes, because that is where the arguments live: the roof discussion, the plumbing failures, the insurance renewal, the vendor dispute. And the litigation disclosure, because litigation affects both value and financeability.
Special assessments deserve particular care from a seller. Section 4525 requires disclosure of assessment changes approved by the board but not yet due, and the allocation of a levied but unpaid assessment between buyer and seller is a matter for the purchase agreement rather than for assumption. If your board is discussing an assessment that has not yet been approved, that discussion will very likely be visible in the minutes a buyer requests, and it is far better handled as something you raise than as something they find. The same is true of an insurance renewal that has come back materially more expensive.
Rental restrictions have moved up the list as well. Section 4525 requires a statement describing any provision restricting rental or leasing, and buyers, particularly investors and buyers planning a partial-year occupancy, will read it closely. So will lenders, for a different reason discussed below. If your association has adopted or amended rental restrictions recently, make sure the version in the package is the operative one and that any related amendment has been recorded. Handing a buyer a superseded set of rules is a small error that reads badly at exactly the wrong moment.
California's balcony inspection law is the item most frequently missing from a seller's understanding of their own building. Senate Bill 326 requires condominium associations to inspect exterior elevated elements, meaning load-bearing components and associated waterproofing for structures extending beyond the exterior walls, elevated more than six feet above ground, designed for human occupancy and supported substantially by wood or wood-based products. Inspections must be performed by a licensed architect or structural engineer under Civil Code Section 5551, with the first inspection due by 1 January 2025 and inspections repeated every nine years thereafter.
The mechanics matter to a seller. The inspection report is required to be incorporated into the reserve study, which means a buyer's adviser reading the reserve study will see it or notice its absence. Where an inspector identifies a condition posing an immediate threat to safety, they are required to notify both the association and the local code enforcement agency within a defined short period. A building that has not completed its inspection, or that has completed it and not funded the resulting repairs, is a disclosure and financeability issue rather than merely a governance one. Ask management directly for the report and for the board's response to it.
Los Angeles adds its own seismic layer. Ordinance 183893 covers pre-1978 wood-frame soft-story buildings, which LADBS describes as two or more stories of wood-frame construction with ground floor parking or similar open space, excluding residential buildings of three or fewer units, on a schedule of two years from the order to submit plans, three and a half years to permit and seven years to complete. The non-ductile concrete program reaches concrete buildings submitted for plan check before 13 January 1977, with three, ten and twenty-five year milestones. Older mid-rise and high-rise buildings in the city may sit inside one of these programs.
Most condominium financing in the United States runs through project-level standards, which means a lender is underwriting the building as well as the borrower. Fannie Mae's Lender Letter LL-2026-03 made several changes a Los Angeles seller should be aware of. It expanded the waiver of project review to projects with ten or fewer units, with the condition that five to ten unit projects are not part of a master association, and it made a project's Unavailable status in Condo Project Manager disqualifying for that waiver. It also retired the Limited Review process for loan applications dated on or after 3 August 2026, leaving Full Review or a waiver.
Two further changes cut in different directions. The letter retired the investor concentration limit that had restricted established projects where more than half the units were investment properties, which helps buildings with a high proportion of rented units. But it raised the minimum reserve allocation for Full Review from 10 percent to 15 percent of annual budgeted income for capital expenditures and deferred maintenance, applying to loan applications dated on or after 4 January 2027, and it tightened how reserve study flexibility may be used, requiring lenders to verify that budgets reflect the highest recommended reserve allocation and excluding the baseline funding method.
The practical translation for a seller is that reserves have become the central financeability question in an ageing building, and that the answer changes on a known date. A building funding reserves at a level that satisfies a lender today may not satisfy the same lender for an application dated in 2027. If your association is at or near the old threshold, that is worth raising with the board now, and worth understanding before you price. None of this is advice about your specific building; it is a lender letter, it is subject to change, and your buyer's lender is the authority on how it will be applied.
Government-backed financing operates on its own approval track. HUD maintains project approval for FHA condominium lending, with a searchable list of approved projects, and approvals expire and require recertification rather than lasting indefinitely. Where a project is not approved, FHA single-unit approval can be available for a unit in a completed project that is ready for occupancy and contains at least five dwelling units, and is not manufactured housing, subject to a reduced set of criteria. VA maintains its own approved-project list on a similar model. Specific percentage tests, including owner-occupancy and concentration limits, change over time and should be confirmed with a lender rather than from any summary.
How much this matters depends entirely on your price band. At the top of the Wilshire Corridor or in Century City, very few buyers are using FHA or VA financing and the approval status of the project is close to irrelevant to your outcome. In the mid-market condominium stock across Hollywood, Koreatown, Westwood, Marina del Rey and much of the Valley, project approval status can determine whether a meaningful share of the buyer pool can transact at all. Establish which of those situations you are in before deciding whether the association's approval status is worth pursuing.
The related question is who else can lend. Buildings that fall outside conventional project standards are not unsellable; they are sold to cash buyers and to borrowers using portfolio lenders who underwrite the project themselves, usually at a different rate and with a larger deposit. That is a smaller pool and it prices accordingly. If your building has an open critical repair, an unresolved lawsuit, thin reserves or a high proportion of rentals, the right move is to know the position precisely before listing, so that pricing and marketing reflect the buyer pool that actually exists rather than the one you would prefer.
Measure ULA applies to condominiums inside the City of Los Angeles on exactly the same basis as it applies to houses, because it tests the value of the conveyance rather than the type of property. That reaches the Wilshire Corridor, Century City, Hollywood, downtown and the Valley. It does not reach Beverly Hills, West Hollywood, Santa Monica or Malibu, which are separate municipalities with their own transfer tax schedules. The Los Angeles Office of Finance publishes the current thresholds and rates, which are adjusted annually, and your title officer can confirm the taxing jurisdiction from the parcel number before you build a net sheet.
The City's pre-sale report applies as well. Los Angeles Municipal Code Section 96.300 requires the seller of residential property within the city to apply for a Residential Property Report, commonly called the 9A, delivered to the buyer before entering into an agreement of sale or exchange or before the close of escrow, at a fee LADBS lists as $70.85. Sellers sometimes assume this is a house obligation. Confirm the position for your unit with LADBS or your escrow officer rather than assuming either way, and order it early enough that it is not the item holding up a signing.
Two ownership structures deserve a specific mention because Los Angeles has more of both than most American cities. Some Wilshire Corridor and Westside buildings sit on ground leases, where the owner holds the improvements and a leasehold interest in the land rather than fee title, and the remaining term, rent resets and lender appetite become central selling points. Others are stock cooperatives rather than condominiums, where the buyer purchases shares and a proprietary lease, board approval is required, and financing is a specialist product. If your building is either, the disclosure and marketing approach differs materially from the description above.
Finally, occupancy. If the unit is tenanted, delivering it vacant is a legal question. The Los Angeles Housing Department administers the Rent Stabilization Ordinance and a separate Just Cause for Eviction Ordinance covering most city rentals outside the RSO, generally where the tenant has occupied for at least six months or the original lease has expired, including buildings constructed after 1 October 1978. No-fault grounds such as owner or family occupancy require relocation assistance. Because a great many Los Angeles condominiums are rented, this is a more common obstacle in condominium sales than in house sales, and it needs advice before listing.
Order the Civil Code 4525 package when you sign the listing agreement. Ask management, in the same message, for the current reserve study, the exterior elevated element inspection report and the board's response to it, the current insurance certificate and any recent renewal correspondence, the current budget and assessment schedule, the litigation status, and confirmation of any assessment approved but not yet due. Ask also whether the project has a status in Fannie Mae's Condo Project Manager, since a lender can check that and a surprise there is best discovered by you. Put a date on each request and follow up in writing.
Then get the questionnaire question answered early. Buyers' lenders send a condominium project questionnaire to the association or its management company, and turnaround times vary from days to weeks depending on the manager. Ask now what your association's typical turnaround is, whether there is a fee, and who signs it. If the answer is slow, that is a fact to build into your escrow timeline rather than to discover on day twelve of a twenty-one day loan contingency. A management company that is difficult to reach is one of the quieter reasons condominium escrows run long.
Assemble your advisers to match the questions. A California community association attorney for anything involving the governing documents, litigation, assessments or rental restrictions. Your accountant for the tax and withholding consequences of the sale, including the Section 121 exclusion and California withholding. A landlord-tenant attorney if the unit is occupied by a tenant. Your escrow and title officers for the transfer tax jurisdiction and the pre-sale reports. And a lender your agent trusts, early, for an honest read on how the building will underwrite. That last conversation is worth having before you decide on a price.
Davis-Stirling requirements, lender project standards, inspection deadlines and Los Angeles ordinances all change, and several changed during 2026; verify current requirements with a California community association attorney, your buyer's lender, LADBS and your own accountant before relying on anything here.
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