Can't Afford Your San Diego Condo Special Assessment? Cash Sale Options

Understanding SB 326 and the Special Assessment Crisis

Senate Bill 326, enacted after the tragic 2015 Berkeley balcony collapse that killed six people, requires all California condominium associations with three or more units to inspect load-bearing components of exterior elevated elements—balconies, decks, stairs, and walkways more than 6 feet above ground. The inspections must be conducted by licensed structural engineers, architects, or civil engineers, and the January 1, 2025 deadline has already passed.

According to industry experts, special assessments between $20,000 and $60,000 per household have skyrocketed across California. Some extreme cases have seen assessments as high as $175,000 per unit. The cost to repair each balcony typically ranges from $10,000 to $25,000, and with 80% of inspected balconies requiring some repair, the financial impact is staggering. For Pacific Beach and Mission Beach condos built in the 1970s and 1980s with wooden balconies exposed to salt air, the deterioration is often more severe, pushing repair costs to the higher end of the range.

Non-compliant HOAs now face daily civil penalties of $100 to $500, which can accumulate to $182,500 annually at the maximum rate. More seriously, board members face potential personal liability if injuries occur, and HOAs risk losing insurance coverage for balcony-related claims. These pressures force HOAs to levy immediate special assessments, leaving owners with impossible choices.

Can You Sell Your Condo Before Paying the Assessment?

Here's the critical question most distressed condo owners ask: Can you sell before paying the special assessment? The answer is yes—but with important caveats.

Unpaid HOA assessments automatically become a lien on your property. This lien clouds the title, making it difficult to sell through traditional channels because buyers typically cannot secure conventional financing on properties with liens. However, cash buyers specialize in exactly this situation. A cash buyer can purchase your condo and either negotiate with the HOA to satisfy the lien at closing or purchase the property subject to the assessment, providing you with a clean exit.

The alternative—waiting or defaulting—carries severe consequences. HOAs have the legal right to foreclose on your property for unpaid assessments. In California, this foreclosure process can move quickly, and you'll lose not only your home but also any equity you've built. The foreclosure will damage your credit score for years, making it harder to rent or buy another home.

For San Diego condo owners in neighborhoods like Pacific Beach, Mission Beach, Downtown, Little Italy, and Point Loma, selling to a cash buyer offers a dignified exit strategy. You avoid foreclosure, protect your credit, and walk away from an assessment you cannot afford. Many cash buyers in San Diego specifically target special assessment situations, understanding the unique challenges and timeline pressures condo owners face.

Frequently Asked Questions