Mar 23, 2026
Approximately 130 residents of a condo complex in Santa Clara, California were evacuated from the building in early March due to fears of a structural collapse.
As CBS News reports, the evacuation was a precaution after reports of “displaced concrete” on the building’s exterior (1). While homeowners in the area around the 56-unit building were allowed to return to their homes the next day, residents of the building are still unable to live in their condos following the initial assessment by city engineers, the building developer’s engineers and the building’s HOA.
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A report from local news service The Silicon Valley Voice suggests residents have been facing ongoing issues since the building opened just a year ago (2). One condo owner complained about “unmet promises,” “construction delays and quality issues,” as well as “rusting metal structures.” Another resident complained about “water leaks during heavy rain.”
In response to the structural issues, the city has stated the developer of the Villa Bella condo complex will be responsible for construction and repairs, and has urged residents to contact their insurance companies for financial assistance to cover the costs of their displacement.
This story proves the importance of understanding your responsibilities as a homeowner, which includes reviewing insurance policies, understanding what you’re responsible for, and ensuring you have adequate emergency savings when issues such as this arise.
Understanding insurance coverage
The National Association of Insurance Commissioners reports that additional living expenses, also known as loss of use coverage, will reimburse many of your common living expenses if your home becomes unlivable due to an insured peril (3). These expenses typically include hotel bills, transportation costs above your ordinary expenses, increased food expenses, pet boarding and the replacement of essential personal items (4).
However, your insurer will only reimburse the costs that are beyond your normal living expenses. Therefore, your mortgage payment, HOA fees and other bills that you typically pay are still your own responsibility.
Experts advise that you keep all your receipts and document your expenses so that you can be reimbursed in full by your insurance company. You should also be familiar with this coverage under your plan, as some policies have both a dollar limit and a time limit for claiming expenses.
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For renters, your insurance should also cover loss of use and the associated expenses. Landlords who own a rental property may also be eligible for insurance coverage for loss of rental income (5).
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How to potentially avoid this issue
For most homeowners, the best way to prepare for a serious issue like this is to try to avoid it. Before buying a condo unit, do your own research on the building’s history, speak to current residents if possible, and ask for records of repairs from the HOA.
Whether you’re a prospective buyer or a current resident, you should understand your HOA’s reserve funding and their fee model, how often they complete safety and structural inspections, and what the HOA’s insurance policy covers. This can help you to understand what expenses you’ll be responsible for in the event of a major issue like the Villa Bella complex in Santa Clara.
However, as law firm Berding Weil notes, condo buyers can be at a disadvantage when purchasing a new home, as information on the building isn’t always available (6). Furthermore, a home inspector typically doesn’t review the building’s common areas, and may not review the exterior adequately.
Berding Weil advises prospective condo buyers to ask as many questions as possible in addition to obtaining the statutory disclosures that the seller must provide. You can also lean on your real estate agent’s knowledge and ability to find information on the building.
How to prepare for the worst
As a homeowner in a condo, you can help to prevent major issues that impact yourself and your fellow residents by staying involved with your HOA and ensuring that routine inspections and maintenance are carried out appropriately. You can also prepare on an individual level by ensuring that you understand your insurance policy coverage and buying additional coverage if you think it’s warranted.
Homeowners should also consider an emergency fund earmarked for repairs to their home, as this can cover minor issues inside your unit, or costs associated with major accidents, disasters or damage to your building that you can’t predict or prevent.
Article sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
CBS News (1); The Silicon Valley Voice (2); National Association of Insurance Commissioners (3); Pandit Law (4); U.S. News & World Report (5); Berding Weil Law (6).
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Rebecca Holland is dedicated to creating clear, accessible advice for readers navigating the complexities of money management, investing and financial planning. Her work has been featured in respected publications including the Financial Post, The Globe & Mail, and the Edmonton Journal.
