Several factors to consider before buying a conversion

By Michelle Hofmann

May 22, 2005 12 AM PT

Special to The Times

Like any resale, condo conversions don’t come with the same construction warranty protection most new homes have. Still, statewide provisions offer some consumer protection.

The California Department of Real Estate requires converters to document any known defects in a written statement. In addition, although not required, developers are asked to submit inspection and structural reports before receiving a public report -- a green light for moving ahead -- from the department.

Because developers should not transfer title or sign binding sales contacts until they have either a public report or an exemption from the DRE, consumers should ask about this, said Chris Neri, assistant commissioner of subdivisions for the department.

Neri recommended that consumers proceed with caution, yet out of 10,000 complaints received by the DRE in 2004, fewer than 80 were against real estate subdividers.

Even so, experts say conversion buyers should do their homework.

Research and visit the builder’s previous conversions or developments, talk to residents and buyers, and compare the conversion unit with attached and resale homes in the area.

Get a copy of the public report and read it to make sure the developer has taken all the necessary steps to ensure a legal conversion through city and state channels. And request copies of any engineering, architectural or structural inspection reports.

Neri said these steps are especially important for those buying “as is.”

“Just because a product is less expensive does not mean it’s going to be less of a headache,” Neri explained. “In fact, it could be more of a headache.”

West Los Angeles resident Hossein Kazemi, 27, learned this lesson the hard way.

In October 2001, Kazemi bought a two-bedroom, two-bathroom condo conversion for $270,000. Within three months, water problems plagued the home. However, when Kazemi turned to the homeowners board, he found it difficult to get immediate help. “During the first year, there was no real board,” he said. “Everyone was getting settled in.”

Today, most of his issues have been settled, but Kazemi said buyers should research the developer and the builder to make sure they have a history of putting together quality projects.

Buyers can also negotiate for a home inspection or hire an independent apartment building inspector to evaluate the unit and property’s condition, Neri said.

For added protection, some purchase extra safeguards through a home warranty.

A standard condo home warranty costs about $215 per year and covers the unit’s major systems and appliances, according to Ray Adams, president of the Burbank-based Buyers Home Warranty Co. and former president of the Home Warranty Assn. of California.

Despite his first experience, Kazemi recently purchased another conversion in Reseda.

“If the price is right and it’s a good deal,” he said, “you have to go for it.”

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Where to shop, if you’re in the market

In Los Angeles County:

* Bella Montagna of Woodland Hills, (818) 999-2773, www.bellamontagnahomes.com

* Metropolitan at Warner Center in Woodland Hills, (818) 712-9717, www.warnercenterliving.com

* Villiago at Brentwood, (310) 820-9351, donheller@prula.com

In Riverside County:

* Mission Villas in Riverside, (951) 776-0028, www.missionvillascondos.com

* Temecula Creek Village, (951) 676-4331, (800) 880-8994

* Triana at Corona Ranch in Riverside, (951) 582-0200, www.trianacoronaranch.com