Buying A Condo....Is Condo Living Right For Me???
Buying a residential condo is very different from buying a single detached residential home! If you do not know the differences or have some ideas, then, this post will give you a lot more information to see if condo living is right for you!
There are many elemental differences to Condos vs. Single Detached but I will hit on a few of the major ones to give you a clearer picture. For more detailed info click this link directly below.
With condos, at least in most circumstances, you do not own the whole residence. What i mean is, you only own from the inside of the drywall and the components within these boundaries. The condo association owns the mechanical, plumbing and electrical systems and all components to the exterior of the drywall. The outside areas, including the grounds(land), flower beds, fencing, lighting and parking are all classified as "common elements" and are really jointly owned by all the owners! Are you confused yet?
Because you only own the interior of the condo, your insurance package is very different. If you have an insurance claim, your insurance is basically paying for the interior surface repairs and replacement and , of course, all personal contents. The balance of insurance coverages are handled by the condo association, which will be paid for, by the owner, through their monthly condo fees. The good news is that most insurance providers are fully versed on condo requirements and have numerous packages with various coverages...it is important to use an insurance company with condo experience! Please note too....if you provide upgrades to your condo above and beyond what was originally installed, by the builder, then any coverages for insurable losses must have a rider attached to cover these items which are called "Betterments".
As mentioned above, Condo Fees are paid each month to the Condo Association to cover monthly expenses of the Corporation. These include, but not limited to, realty taxes of the common elements, property manager compensation, landscaping, snow removal, maintenance repairs, and establishing a reserve fund for anticipated large repair expenses and replacements in the future. Many condo corporations have different structures and charge differently for the required services....it is important that when you are shopping for a condo that you compare the costs between condos so you know exactly what you are paying for.
A Reserve Fund is required to be done every five(5) years, as required, by Canadian government regulations. This fund was established to prepare the condo owners for future large expenses/repairs/replacemments of things like roadways & curbs, sidewalks, sewers, painting, windows, garage doors, landscaping, roofing etc. This process forces owners to pay now for exceptionally large costs later. The government decided to do this as many associations were not planning for down the road and when a large expense came along Owners could not afford to pay their share. The result was that the Board of Directors had to ask for an "Special Assessment" to cover the costs!!! Note: Many corporations that did not have a Reserve Fund, prior to the legislation, were required to establish one and play "catch-up" on the required reserve fund amount resulting in much higher monthly fees! Buyer Beware....
This is a very important topic! Status Certificates are a collection of the legal and financial well-being of a specific Condo Association. They advise if the reserve fund is up-to-date, if the unit owner who is selling is current with his/her individual condo fees, if there are any deficient and outstanding fees for common element contracts or liens agains the property, and any anticipated condo fee increases or special assessments, to mention a few. Your Realtor, if experienced, will direct you and insist that this Status Certificate is included as a condition of sale in the Purchase and Sale Agreement.
What About The Advantages:
Condos are an advantage for many people both young and old....here are a few:
-Lock & Go-People that travel a lot or work long hours just lock the door and leave. Very little outside maintenance is required. No grass cutting; no snow shovelling!
-Community-There are usually a number of people in the commmunity and usually different groups are formed such as card groups, book clubs, gardening groups etc. People can generally be as social as they want.
-Amenities-There can be many amenities that individuals do not have available to them such as visitor suites, pools/saunas/hot tubs, exercise/workout rooms, media rooms just to mention a few.
Some Other Thoughts:
There are many Realtors out there that sell real estate....some of whom have never sold a condo. It is extremely important that the Realtor you hire has substantial knowledge of condo operations and is current with all the legislative changes that happen at all government levels. Don't be afraid to ask any potential Realtor what their experience is in Condo sales. Have they sold any recently? Request testimonials!
If you have other questions, please call/text me at 905-977-9807. My email is: firstname.lastname@example.org
My website is: www.paulhammondrealtor.ca
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