Before we dig in perhaps it’s a good idea to make sure you are clear on something. A condo is a kind of strata property and that when I set up a customized MLS search for you, the search system searches for stratas as a broader category which also includes townhomes, bare land stratas and really anything where groups of people are sharing aspects of common property. I will talk about condos here but please bear in mind that functionally this applies to all kinds of strata properties.

Condominiums are a great alternative to house ownership. Maybe you are considering a condo because a house with a yard is not in your budget or maybe because a house is just too much work for you and your situation. If you’re looking to buy your first home, or want to downsize, chances you are considering buying a condominium. Before jumping in there are a few things that you should consider.

Condominium living is different from owning or renting a detached house because condominiums have a dual nature when it comes to ownership. Condominium owners hold title (ownership) to their units and share responsibility for the operating costs of the exterior/rest of the complex. Common areas such as lobbies, roofing, gardens and so forth make up the area of Strata complex that are shared. Exactly how that is set up and how that is managed is case by case, but by and large they don’t vary a whole lot. Mostly the noticeable variations are on a short list of specifics like policies on rentals, pets, age restrictions and a few other less common variations.

There are many advantages to condominium ownership. The most prominent one being that it is typically less expensive than house ownership. It can also provide an fairly instant sense of community if that is something you desire. Some of themt have clubhouses/party rooms and where you could hold get togethers with neighbours and friends. The bonus of a sense of community is that that people end up looking out for each other more which is a bonus in terms of security and having someone to feed your cat or water your plants while you are away. Another plus is that stratas, as a rule, exist in locations where there is higher density and are closer to shops, restaurants, buses and any amenity you can think of.

That said, condominiums are not everyone’s cup of tea. Strata Corporations typically set restrictions on things such as owning pets or having an outdoor barbeque. The thing with sharing is that not everyone agrees on how to run the place since everyone has a bit of a different personality, different ideas of how much to spend on maintenance, how they want it spent and different ideas of ideal lifestyle.

Also worth noting is that some owners (like me) do not want to own in a strata complex that doesn’t allow rentals as it prevents some potential for income should you decide to move on from your property. That may simply be a loss of potential income in some cases but could turn into genuine financial hardship in cases like when the market has gone down a little, and they don’t have the equity required to sell but they have to move because of a work transfer or an illness.

That said, in a given complex it is mostly the renters that cause the annoyance and drama. Mostly. Hence the notion of not having rentals in many of the higher end complexes.

Regardless of exactly what your hopes and dreams look like, I would consider some general points before even getting into the serious search for a strata property.

How the complex is managed

A Strata Council is like a board of directors elected by the owners. They manage the “Strata corporation” which is just a fancy term for the entity that is the complex. Most strata councils will meet every one to three months. hopefully they are guided professionally by a Strata Management company via a representative, called a Strata Manager.  The Strata Manager knows all the ins and outs of proper maintenance, procedure and laws regarding strata management, which really, if a lot of info.

Sounds booooring, right? It is boring if you’re not a Realtor or maybe something like a Lawyer. I’ve sat on such councils myself for six years of my life thus far, and although in some ways it is interesting because it connects to my profession, I still have to admit that mostly it is pretty mundane.  However, a strata council can make a big difference in the lives of those in the complex so it is important that all owners at least have a concept of what goes on in those meetings so they can understand why and how things are done the way they are. If you do not choose to get involved in the council you should at very least read the meeting minutes as they come out and attend AGMs. Sometimes one hour conversations are summarized in just one or two lines in the minutes so be prepared to ask the Strata Manager questions about anything that piques your interest. They are overwhelmed by questions, requests and tasks as a rule, but at the same time this is the sort of thing they are there for so I say ask them.

I cannot over emphasize the value of a good Strata Manager. It is a super tough job and they tend to burn out fast so having the right talent on your side is golden. They do not make any of the decisions but their level headed knowledge and experience provides info that is sobering to a strata council that may otherwise make different decisions not knowing the likely consequences of their actions or inactions.

Major decisions are voted on at owners’ general meetings.  Participation in community decision-making is a benefit of condominium living. Again, it’s dull, it’s dry but it makes a big difference to the quality of life in the strata so I recommend getting involved in what in my eyes in a mini democratic society.

Conditions and Restrictions

Condominiums are governed by a set of rules called bylaws, which are enforced by the strata council. Bylaws vary from one development to another but mostly look similar except for the common variations mentioned above like rentals, pets and age restrictions. Others  I see variations on fairly often are whether an outdoor BBQ is permitted at all or if it is, what kind, are you allowed to do any of your own gardening (usually not) and once in a long while I encounter a place where the windows are the responsibility of the owner, not the strata.

As a potential condominium owner, you should be comfortable living within the bylaws of the strata and living in close proximity to others. Worth noting here is that it is typical to make any offer on a strata property conditional on seeing the strata documents which are quite extensive and include a copy of the bylaws and a ton of other things. It takes time to get as well as review them so I would say that this is why that part is not done until after the offer is accepted and we are in the subject removal phase. (See #5 here for info on subject removals. There would be a sixth clause here to refer to the need for strata document review)

Strata Fees

The Strata Council plans budgets and determines the fees for all units, usually based on the size of each unit, the number of units occupied and the projected expenses for maintenance and repair.

Every condo owner pays fees to help maintain the building, pay the salaries of  handymen or groundskeepers, and provide facilities such as a pool, gym or gardens. The fees are paid monthly and are subject to change.

Special assessments could be made when an unexpected repair or planned modification exceeds the cost of the condo fees collected. “Special assessment” is a kind of a dirty word to me. Sometimes they are necessary but if a complex is managed well, they are few and far between.

Questions to ask

It’s important that you read and understand the documents given to you when you are purchasing a condo. I will go through them first and make some notes about my thoughts on the matter but only you can decide what is in your comfort zone and what is not. Certainly, if I see something that I think is cause for concern or worth noting I will point it out but bear in mind that although I know real estate deeply, I probably don’t know you deeply.

The documents are extensive. Like 200-500 pages extensive. It will take me some time to go through them before I pass them to you along with my notes. Again, it is up to you to read through it all even though it is not a fun or light read. They will outline the bylaws, budgets, insurance, meeting minutes for the past two years, a Form B which is a summary of what the situation of the particular unit. If you don’t have a clear understanding of the information provided in the documents, ask for clarification so that you know what you are getting into.

Those minutes are pretty telling of the state of things in one way or another. Those plus the bylaws are the meat of it in my eyes but there could be important discoveries anywhere in the docs so they are all worth reviewing.

Amenities

One of the easier points to wrap one’s head around is that included in the price tag is the amenities included in a complex.  As these are used communally, they are also paid for communally. So, try to resist balking at a strata fee, be it high or low, until you know what is included in that fee. Higher fees may simply mean that the complex is old and needs lots of maintenance or it may mean there are some great amenities, or it may mean that it was not well managed financially in the past and they are trying to play catch up on things like the contingency reserve fund.

Allow me to illustrate; On one end of the spectrum we have what we see in most basic condos. The fees for these pay for landscaping and garden maintenance, the exterior of the building, common property like hallways and elevators and maybe a room of extra storage units downstairs. This is the most common setup. On the other end of the spectrum is something like what we see in the lovely Edgewater complex in Nanaimo. It varies a bit from building to building but I had a listing there a little while ago that had really high Strata Fees which caused a stir when people saw them. But once I told everyone what was included, they immediately stopped complaining. This place  has a clubhouse that is grand enough to have a wedding reception in. I mean like a classy building with a veranda overlooking a grand pond full of lily pads. There is an exercise centre, a recreation centre, a workshop, guest suites, a storage unit and last but not least the natural gas to the fireplace which was included in the strata fees which provided nearly all the heat to the home. Ultimately, those strata fees made sense.

Ryan Coffey

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