Selling a San Diego Condo With an HOA Special Assessment

If you own a San Diego condo, you may have heard the balcony-inspection deadline got pushed to 2026. It did not — not for you. The 2026 extension applies to apartment buildings under SB 721. Condominium associations fall under SB 326, and that deadline was January 1, 2025, with no extension.

That distinction matters right now because HOA budget season is here, boards are voting on how to fund repairs the inspections uncovered, and special assessments are landing in mailboxes in the middle of the fall listing window. If you are planning to sell, the single most useful thing you can do this week is request your association’s inspection report and current reserve study — before you set a price, not after you are in escrow.

Who this is for

San Diego condo and townhome owners thinking about selling in the next six to twelve months, and owners who just got a notice from their board and are trying to figure out whether it torpedoes the sale. Also — and I hear from these owners constantly — people who own a San Diego condo from another state, whose only window into the building is whatever arrives in the mail. My own family is spread across the country, so I understand how easy it is for something like this to sit unopened for three weeks.

It does not torpedo the sale. It changes how you price it and when you disclose it, and those two decisions are worth a lot of money.

What SB 326 actually requires

California Civil Code §5551 requires condominium associations to have a licensed structural engineer or architect inspect the building’s exterior elevated elements — balconies, decks, stairways, walkways and their railings that are more than six feet above ground and supported substantially by wood. The first report was due January 1, 2025. After that, the cycle repeats every nine years.

Two things follow from that, and they are the whole story:

• The inspections found things. Wood framing that has been quietly absorbing coastal moisture for thirty years does not look good under a probe. Buildings all over the county came back with repair scopes nobody had budgeted for.
• The reports belong in the buyer’s packet. Under Civil Code §4525, a seller has to deliver a specified set of association documents to a prospective buyer. Your escrow officer orders that packet from the HOA or its management company. A buyer’s agent who is paying attention will read the inspection report and the minutes.

So the question is never “will they find out.” It is “do they find out from you, on your timing, with a number attached — or from the HOA packet in week two, with no explanation.”

The number I am not going to quote you

You will see figures circulating for what these assessments cost — anywhere from $40,000 to $175,000 per unit. Those numbers come from contractor blogs and law-firm marketing, not from any central registry, because no central registry exists. I am not going to repeat them as if they were a statistic.

What I can tell you from working San Diego buildings is the shape of it. A small association with limited wood exposure and a healthy reserve fund may absorb the repair without an assessment at all. A 1970s or 1980s coastal complex with wood-framed balconies on every unit and a thin reserve is where the frightening numbers come from. The variable is not the law. It is how much wood your building has and how honestly your board funded reserves for the last twenty years.

Get your building’s actual number. Do not price off an internet range.

Why lenders care, and why that is really the issue

Here is the part that surprises sellers. A special assessment does not just reduce what a buyer will pay. It can affect whether a buyer can get a loan on your building at all.

Since 2021, conventional lenders have been asking condo projects directly whether there is significant deferred maintenance or an unsafe condition in the building, and whether any needed repairs affect safety, soundness, or habitability. A project that answers the wrong way — or a board that will not answer at all — can be found ineligible until the work is funded or completed. When that happens, your buyer pool shrinks to cash and portfolio lending overnight, and so does your price.

This is why a funded assessment is so much less damaging than an identified but unfunded repair. A board that has voted the assessment, set a payment schedule, and put the contract out to bid has given lenders something to underwrite. A board that got the report in 2025 and has been arguing about it ever since has not.

If your board is in the arguing phase, that is worth knowing before you list. It may be worth a year of patience.

Your three real options

Option	How it works	Best when
Pay it off at close	The assessment balance is paid from your proceeds through escrow, and the unit transfers clean.	The assessment is levied, the amount is fixed, and you have the equity. Cleanest story for a buyer and for their lender.
Credit the buyer	You price at market and give a closing credit sized to the assessment, letting the buyer take over the payment plan.	The assessment is payable in installments and the buyer would rather have the cash at closing than a lower price.
Price it in and disclose up front	You set the list price with the assessment visible from day one and market the building’s repair as completed or funded work.	The repair is a genuine improvement and the building will be better for it. Works best when the scope is defined.

And then there is the fourth option, the one people actually try: say nothing, hope the buyer’s lender does not ask, and deal with it if it comes up. I want to name it plainly so nobody drifts into it by accident. It does not work. The packet goes to the buyer regardless, the lender asks the association directly, and you end up renegotiating from the weakest possible position — in week three, with your buyer annoyed and your leverage gone.

Same fact, different outcome. The only variable is who said it first.

Why timing matters more this fall

San Diego is carrying roughly 6,400 active listings and about 3.2 months of supply — the most inventory we have seen since 2019 — with homes going pending in a median of around 25 days. Buyers have alternatives. A buyer who discovers a $60,000 assessment in week three does not negotiate. They cancel and go look at the other condo in the same zip code that disclosed everything in the listing remarks.

In 2021 you could have hidden a lot behind a bidding war. You cannot now, and I would argue you should not want to. I will not quote you a countywide median price, by the way — the sources I trust are returning three different numbers for it right now, and a number I cannot stand behind is worse than no number.

What to do this week

1. Email your HOA manager and request the SB 326 inspection report, the current reserve study, and the last twelve months of board minutes. You are entitled to association records as an owner.
2. Read the minutes for the word “assessment.” Boards discuss these for months before they vote. If it is coming, the minutes will show it.
3. Check the pro forma budget. Associations distribute an annual budget report ahead of the fiscal year — that is the document that tells you whether reserves are funded or whether an assessment is doing the work.
4. Get a real valuation with and without the assessment. The gap between those two numbers is your negotiating room, and it is usually smaller than owners fear.

Frequently asked questions

Who legally pays a special assessment, the buyer or the seller?

California does not assign it by statute — it is negotiated in the purchase contract. In practice, assessments already levied before closing are typically the seller’s responsibility and anything levied afterward is the buyer’s, but that is convention, not law, and it gets negotiated on almost every deal. Confirm the specifics with your agent and escrow officer.

Do I have to disclose an assessment that has been discussed but not voted on?

If you know about it, disclose it. Material facts you are aware of belong on your disclosures whether or not they have reached a formal vote. Our guide to California seller disclosure requirements covers what that actually means in practice.

Will an assessment stop me from selling?

No. Buildings with assessments sell in San Diego every month. What stops sales is an assessment that is unfunded, undefined, and undisclosed — the combination, not the assessment itself.

Should I wait until the repair is finished?

Sometimes. If the work is scheduled and short, a completed repair is a genuine selling point. If your board has not voted yet and there is no timeline, waiting can mean waiting years. That is a case-by-case call and it is exactly the kind of thing worth a conversation before you commit either way.

Get the real number before you price it

The owners who do well with this are the ones who found out early and built the price around it. The ones who struggle are the ones who found out in escrow.

I will pull your building’s recent sales, look at what comparable units with assessments actually closed at, and tell you honestly whether this is a price adjustment or a reason to wait. No cost, no pressure, and I will tell you if the answer is “don’t sell yet.”

Book a seller consultation →

More on the numbers side: what it actually costs to sell in San Diego and how to get a valuation you can trust. Or start with our seller services.

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Amara Berg — Big Returns, Inc. I sell San Diego homes and manage rental property here, and I spend an unreasonable amount of time reading HOA minutes so my clients do not have to. Find me on Instagram @sdrealestateagent.

Amara Berg, CA DRE #01961620. This article is general information for San Diego property owners, not legal, tax, or financial advice. Statutory references are provided for your own research; confirm how they apply to your association and your sale with your attorney, your escrow officer, and your CPA.