|
What is a condominium?
A condominium is a type ownership where certain parts of the property (the units) are owned by individuals, and certain parts (the common elements) are owned in common by the unit owners, all of whom are members of the condominium corporation (the organization responsible for the operation of the condominium). Ownership of a condominium means you own the specific unit plus individual interest in the common property. You have ownership over all space and improvements within the walls of your unit.
It is very important to know that you are buying the condominium building first and then the unit, so make sure you like the building and its financial position. I will assist you with this.
What are condo fees and are there property taxes for condos as well?
A condo fee is a fee that each owner is charged to cover the expenses of the complex and individual unit. For example, in a high-rise condominium, the condo fee includes all utilities, plus building insurance, management and reserve fund contributions. When the plan is registered at Land Titles for a condominium, a separate title is created for each unit. And shown on each title is the owners share in the common property, which is expressed in "unit factors". This "unit factor" can be based on the units proportionate square footage or the initial market price in comparison to the rest of the complex. A budget is prepared for a condominium complex, and the fees are allocated according to the unit factor of each condominium unit.
There are also property taxes for condominiums, and they are also calculated based on the unit factor.
What is a reserve fund?
A reserve fund is money that is set aside for repairs, maintenance, or improvements. A portion of the condo fee is used for this fund. In the budget planning stage of the condominium corporation, it is important to analyze the state of repair of the complex, and decide what percentage will be required to do the necessary items. It is important to have a reasonable reserve fund because if there is a shortfall, all the units would be assessed. Condominium corporations usually plan for their future expenditures accordingly for their reserve fund.
Who manages condominium complexes?
The owners of the condominium either hire a management company, or the owners set up their own management group and do it themselves.
Are there any special documents required for a condominium?
Yes. The documents required are:
- Condominium Bylaws - The rules and regulations that a condominium is governed by. They are set up to protect the interests of the condominium owners.
- Current Budget and Financial Statement – The budget is their plan for the year. The financial statement is what actually occurred, and the amount they have saved.
- Property Management Contract
- Insurance certificate – Certificate showing the amount of fire and liability insurance covered on the entire building and the fixtures as originally built.
- Leases on parking stalls and storage – if applicable.
- Status Certificate – The legal document from the condominium association stating the following:
- The current condominium fee.
- When it is due and payable monthly or quarterly.
- The arrears, if any, of the condominium.
- Any special contribution levied to each unit by the condominium corporation.
- Any outstanding litigation on behalf of the condominium corporation and the possible results.
- The amount of the reserve fund, established by the condominium corporation to be used to effect necessary repairs.
- Any condo fee increases anticipated in the future.
- Minutes of the Meetings – The minutes will tell us what has happened and what the condo association’s plans are for the future.
Do condominium owners need insurance, or is it covered in your condo fee?
The condominium corporation placed insurance that complies with the requirements of the Condominium Property Act, and the condominium bylaws covering the insurance of the building. The condo owners are responsible to insure their personal belongings, furnishings, personal effects, as well as insurance coverage on the improvements made to their units. Like home ownership, the unit owner repairs the damage if someone else causes it, and recovers it from that other person. If a pipe breaks, or there is seepage from an adjacent unit, contact the manager and your own insurance company. The insurance company will arrange for repairs and determine the liability.
Do condominium owners have the freedom to bring in pets?
Some condominiums allow pets with the permission of the Condominium Association. The Condominium Bylaws for the complex will specify if pets are allowed.
Do some condominium complexes have age stipulations?
Yes. There are some condominium complexes that specify "18 or over" or "45 and over". Children are allowed for visits only for short periods of time as specified in the Bylaws. To verify these restrictions check the Bylaws on the Title. Some developers have registered restrictive covenants on some properties to limit the use of the property. For example, restrictive covenants are registered regarding the age stipulation.
Can you rent out your condominium?
Again you will need to check the bylaws of the condominium. Basically, almost all complexes can be rented. Some condos do require you approve your tenant and hold the damage deposit.
|
