Condo Buying Guide

When you buy a condo, you are buying a unit and a share in a building that other people also own. The building’s finances, rules and condition affect you as much as the unit itself. This guide covers what to look at beyond the floor plan.

What you actually own

You own your unit, and you share ownership of the common elements, such as the hallways, elevators, roof, lobby and amenities, with the other owners through the condominium corporation. The corporation is run by a board elected by owners, and it collects monthly fees from everyone to pay for upkeep and operations.

Condo fees

Condo fees pay for the shared costs of the building. Find out:

• What the fee covers. It might include water, heat, building insurance, maintenance, the property manager, amenities and contributions to the reserve fund. It varies by building, so two buildings with the same fee may cover different things.
• What it does not cover. Often your own hydro, your own contents and unit insurance, and sometimes parking or locker fees.
• How it has changed. Ask for the history. Large increases suggest rising costs or under-funding.
• What portion goes to the reserve fund. Very low contributions can mean larger fees or special charges later.

Always add the condo fee to the mortgage and property tax when you work out your monthly cost.

The status certificate

For a resale condo, the status certificate is the main way to look inside the corporation before you commit. It is requested from the condominium corporation and reviewed by your lawyer. It typically includes:

• The corporation’s budget and financial statements
• Information about the reserve fund and the most recent reserve fund study
• Any special assessments that have been charged or are planned, and why
• Any legal proceedings or judgments involving the corporation
• The declaration, by-laws and rules
• Details of the unit’s fees and any amounts owing
• Proof of the corporation’s insurance

It is common to make your offer conditional on a satisfactory review of the status certificate. Do not waive the condition without your lawyer reviewing it.

The reserve fund

The reserve fund is the building’s savings for major repairs and replacements, such as the roof, elevators, windows, parking garage and mechanical systems. Condo corporations are required to have a reserve fund study done at regular intervals, and it estimates when major components will need work and what that will cost.

Questions to ask your lawyer or agent:

• Is the reserve fund healthy relative to the work the study expects?
• Are contributions increasing?
• Is a special assessment (a one-time extra charge to owners) likely?
• How old is the building, and have major repairs already been done?

Rules and lifestyle

The declaration, by-laws and rules set what you can and cannot do. Check, before you buy:

• Pets: are there limits on type, size or number?
• Renting: are there restrictions on renting out your unit, or minimum terms?
• Renovations: what needs approval?
• Smoking, noise, balcony use, move-in rules
• Short-term rentals

If any of these matter to you, make sure the documents allow it.

Parking, lockers and bike storage

Do not assume the unit includes them. Find out:

• Is the parking spot or locker owned by the unit, or assigned for your exclusive use, or just rented?
• Does it come with the unit’s sale?
• Is there a fee, or is it included in the condo fee?
• Is there electric vehicle charging, and how does it work?

Amenities and what they cost

A gym, pool, party room or concierge are included in the cost of the building. Ask whether you will use them, and what they cost to run and maintain, since that goes into your fees.

Insurance

The corporation insures the building and common elements, but you still need insurance for your own contents, improvements to your unit, and personal liability. Ask what your unit is responsible for, and whether the corporation’s policy has a deductible that could be charged to owners after a loss.

Viewing the building, not just the unit

• Look at the lobby, hallways, elevators, garage, and common areas. Are they well kept?
• Ask about recent or planned major repairs.
• Notice noise, smells, and how the building handles deliveries and security.
• Ask the agent or the property manager how long the property manager has been there and how responsive the board is.

Pre-construction condos

If you are buying a condo that has not been built yet, there are additional protections and additional risks. A 10-day cooling-off period, deposit protection, and a different set of documents apply. See the Pre-Construction Guide.

Questions to ask before you offer

• What does the fee include, and what is it likely to be in two years?
• What does the status certificate show about the reserve fund, special assessments and legal proceedings?
• Do the rules allow how I plan to live in the unit, including pets or renting it out later?
• Is the parking spot and locker owned, assigned or rented?
• What major repairs are planned or overdue?