CONDOMINIUMS QUESTIONS AND ANSWERS

Q & A

Question: What are the different types of condominiums available?

Answer:  There are several different types of condominium classifications and it is important to understand the difference of each.  The following three are the most popular…

• New and Resale Condominiums – The purchaser owns the area within their own individual living space but not the land that the condo sits upon.  The condo association here will be heavily involved in determining the amount of condo fees you pay and what those fees are used for.
• Condo Hotel/Resort – Generally these are condo’s that are located in a resort setting and there may be provisions that give the resort the option to rent out your condo when it is not in use.
• Condo Conversions – This is a condominium that has been converted from an apartment complex.

Question:  What portions of the property will I actually own?

Answer:  Make sure you are clear on whether your ownership is limited to the space inside your own individual living space or if your property includes parking spaces and storage units.

Question:  Are there particular areas on the condo site that are designated as common areas and limited common areas?

Answer:  A common area is one in which all residents are entitled to use such as a pool, fitness centre or park etc.  A limited common area may be defined as a portion of fenced off property that is for the sole use of particular unit owners, or in the case of a beach front property it may represent a dock that is owned by one or several residents.

Question:  How is the condominium run?

Answer:  The condominium owners elect a Board of Trustees or Condominium Association.  It is the responsibility of these elected persons to manage the condo issues, make critical decisions and hold annual general meetings, which allow all condo owners an opportunity to discuss and review financial statements and current issues.

Question:  What is the ratio of occupants who are the actual condo owners, as compared to those that are renting from the owners?

Answer:  This is an important question to ask because generally the condo owners are going to be more concerned with the day to day condo association and property maintenance issues than what short-term renters might be.

Question:  What are condominium dues or fees?

Answer:  As a condominium owner you are responsible for paying monthly dues or fees to the condo association.  These dues or fees are used to cover the costs of repairs, regular maintenance and upgrades to the common areas.

Question:  What is a condo reserve fund?

Answer:  The purpose of a condo reserve fund is to pay for major repairs and maintenance to common areas of the condominium.

Question:  How much money is in the reserve fund?

Answer:  The general rule of thumb is that 10% of the annual gross condo fees should be placed into the reserve fund.  This is an important question to ask because you want to be able to feel safe in that there will be enough funds available for future unforeseen repairs and maintenance.

Question:  What are Condominium By-laws and Rules?

Answers:  Make sure that you review a copy of the by-laws and rules prior to sealing the deal.  These documents will dictate rules and regulations that condo owners must abide by.  These rules are important to review as they may prevent owners from having pets, bringing bicycles into the elevators/lobby area, or may prohibit the use of seasonal decorations on balconies etc.

Question:  Ask to look at the minutes of at least the last six condo association meetings.

Answer:  Reviewing the past meeting minutes will give a potential owner an idea of previous issues and problems and how they were handled, as well as current and future project plans.

Question:  Are there any settled or pending lawsuits on the building?

Answer:  A pending lawsuit is something that you will definitely want to avoid and therefore you will want to ensure that you inquire about this issue before seriously considering purchasing.

Question:   Ask to review a copy of the certificate of insurance.

Answer:  This is basically a summary of the association’s policy and what you are looking for here is a determination of whether or not the policy covers replacement costs that accurately reflect the actual costs of rebuilding.  Additionally, you will want to ensure that the policy has a building-ordinance clause.  This insurance clause will cover the cost of bringing the building up to code in the event that any rebuilding is required.

Question:  Can I make changes to my condo unit once I own it?

Answer:  Any rules and regulations regarding alterations to the unit itself will be clearly outlined in the condo by-law and rules documents.

Question:  Am I allowed to have pets in a condominium?

Answer:  Because the Ontario Landlord and Tennant Act does not apply to condominium developments, the rules regarding pet ownership will be determined within each respective condo’s by-laws and rules.  Check these documents carefully prior to making an offer, otherwise you may risk being forced to get rid of your pet(s) once you move in.

Question:  Can I rent or lease out my condo unit?

Answer:  The answer to this question is dependant on the rules and regulations set out by the condo association.  Make sure that you read through all applicable documents in order to determine whether you may or may not rent out your condo.

Question:  Ask other owners in the building what they like least and what they like best about living there, as well you should ask them if they would ever buy again in the same building.

Answer:  Most residents are going to be friendly and willing to share good and bad experiences.  Be sure to carefully consider the opinions of those who presently live in the building that you are considering future residence in.