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A Primer on Condominiums


Blog by Kim Twohey | September 8th, 2015


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Condominiums offer a form of home ownership that has become increasingly popular across Canada over the last few decades.  The Canada Mortgage and Housing Corporation (CMHC) explains that a condominium, also referred to as a condo, is a form of legal home ownership.  Condos can be in a variety of forms including townhouses, low rise residential buildings, single detached houses, and vacant land.  In urban centres, there are even mixed use condominiums that include residential units and commercial space. 

Condominiums offer a unique home ownership experience that comes with specific pros and cons.  Some of the pros of buying a condo include:

  • Set monthly maintenance fees. 

  • Fewer interior and exterior maintenance responsibilities than in a traditional home.

  • Opportunities to participate in discussions and decisions that affect your investment.

  • In some cases, enhanced security.

  • In some cases, additional amenities such as an onsite fitness facility, concierge service, or a party room.

  • A feeling of community.

Some of the cons associated with buying a condo include:

  • A lack of control over things like the quality and timeliness of maintenance and repair issues.

  • Restrictions on improvements and modifications that you are allowed to make to your unit.

  • Possible increases in condo fees due to significant and unexpected repairs. 

  • Possible restrictions on things like pets, window treatments, and the number of occupants allowed in the unit. 

  • Possible restrictions on using the unit as a revenue generating property. 

There are two different types of condominiums:  freehold condominiums and regular condominiums.  A freehold condominium allows for the ownership of the land and any structures on the land.  Examples of freehold condominiums include houses and townhouses.  While this type of condominium tends to have more maintenance responsibilities for owners, it also offers more freedom and flexibility in terms of how the property is managed.  In a regular condominium, the land is typically owned by a condominium corporation and there are multiple common areas such as the exterior, hallways, elevators, lobbies, and parking structures that are maintained by the condominium corporation.     

Buying your first condominium is not the same as buying a traditional home.  There are different terms and conditions that are important to consider during the condominium purchase process.  Here are a few things you might see in the purchase documents that you will want to pay special attention to.

Bylaws:  The rules and procedures that must be followed while owning the unit.

Common property:  All the areas that are part of the condominium plan that are not within a specified unit.     

Condo fees:  The fees that all condominium owners are required to pay in contribution to a fund that covers common property costs.  Condo fees can cover a wide range of expenses and Buyers should request a list of what is included in their fees.   

Reserve fund:  The reserve fund is the total amount of money the condominium corporation has set aside to cover the costs of major building repairs and unexpected emergency situations.  Prospective Buyers can ask to review the Reserve Fund Report and the Reserve Fund Plan to determine the health and liquidity of the reserve fund. 

Just like with traditional single family homes, not all condominiums are created equally.  The best way to know if a condo is the right choice for you, your budget, and your lifestyle is to work with a knowledgeable Realtor.  Look for someone, like myself, who has earned their Certified Condominium Specialist certification.  Questions?  Feel free to contact me!