Understanding the Texas Uniform Condominium Act

Did you know that your clients can be forced to sell their condominium because other unit owners agree to sell the condominium building?

That’s true in some instances. According to Texas law, if the condominium declaration states that a condominium building can be sold when less than 100% of the owners agree to a sale, an owner can be forced to sell. Once a contract for sale is finalized with the requisite number of unit owner votes, any unit owners still opposed would be forced to sell.

The Texas Uniform Condominium Act contains a provision which states that unless a declaration provides otherwise, a condominium building may be terminated and sold if 100% of the owners agree. It also allows unit owners associations to adopt a rule allowing for a lower threshold of 80% of the votes. A unit owners association may contract for the sale of the building, but it will not be enforceable until the required number of unit owners have ratified the termination agreement. The agreement must detail the terms of the sale and all ratifications must be recorded in the county or counties where the condo building is located.

Condominium owners can review their condominium declaration documents or unit owners association documents to see the percentage of votes required to force a sale.

Although there is no proposed legislation in the current Texas legislative session to amend the Texas Uniform Condominium Act regarding approval of the sale of a condominium building, REALTOR®-supported legislation has been introduced that would increase transparency of condominium owners’ associations rules.

Source: Texas REALTORS®