Last week was the pre-qualification lecture. This week: the condo lecture. It’s for your own good and really, it’s because we care about our clients so much that we are always willing to have these tough conversations. And have them early and often. If you’re thinking of buying a condo in Alberta, or you want to sell your own condo, the condominium document package is mission critical. Here’s why…
Nearly every offer made on a condo contains a buyer’s condition, subject to the buyer’s approval of the condominium document package. The contents of these documents tell you a lot about what you’re buying. That’s because when you purchase a condo, you’re not just buying the unit you’re living in, you’re buying shares of a corporation. So, as a condo owner, you not only own your unit, but you acquire shares of the common property.
Common property can include the exterior of the building, the land, the parking lot, the hallways, etc etc. The common property doesn’t take care of itself. Using money from the monthly condo fees, an elected Board of Directors will manage the money in the corporation which goes towards things such as:
- Reserve Fund (money set aside to say, replace an aging roof)
- Insurance for the common property
- Common property maintenance (e.g. landscaping and snow removal)
- Professional property management (not all condos do this but it’s common)
As an owner, you need to understand how effectively and efficiently the condo is being managed. You need to know the financials are healthy and that you’re also okay with the by-laws. (Age and pet restrictions are a deal breaker for a lot of people!)
Some folks are under the impression that things like by-laws are just goofy rules which can be broken. No they cannot. They’re there for a reason and they are often enforced. Reason being that some of those by-laws maintain a specific lifestyle which unit owners enjoy, in turn protecting the value of their condo.
Watch my video below for further explanation regarding the importance of an up-to-date condo doc package when buying or selling a condo in Alberta