Condominiums
Between one-third and one-half of all new homes sold in the GTA today are condominiums. Many people think a condo is a high-rise building where people own apartments rather than rent them. But a condominium is not a type of housing; it’s a type of property ownership. Although many condominiums are high-rise suites, they are also townhouses, low-rise multi-unit buildings of any shape and style, even some detached homes.
When you purchase a condo you have complete ownership of certain elements (your unit and perhaps your parking space and storage space) and shared ownership of other elements (the common elements, such as the parking garage, hallways, the roof, social and recreational amenities, the exterior landscaping and so on). Then there are common elements that individual unit owners have exclusive use of, such as their balconies.
How elements are defined changes from building to building, so don’t make any assumptions about what is common and what is not. These issues are detailed in a document called a Disclosure Statement, including the rules (by-laws) of the condominium. You should check on restrictions that may be in place with respect to your unit (some condo corporations do not permit pets) or the common areas (you may not be able enclose your balcony or park certain kinds of vehicles in your parking spot).
You should also review the Disclosure Statement closely to determine what changes you can make to your unit or to common area elements without voiding your warranty.
Condos are often considered maintenance-free because you usually don’t have to shovel the snow or cut the grass. Lawns and sidewalks normally fall under common ownership and are taken care of by the condominium corporation (although you have to pay your share of the cost). But this isn’t always the case – in some condos the common elements are quite limited, which reduces common costs but means you have to take care of more maintenance on your own.
In addition to sharing in monthly costs, you will also have to contribute to a reserve fund that goes toward covering future major repairs and replacement and insurance.
Condominium purchasers have a 10-day cooling off period, called a “right of recission,” after signing an Agreement of Purchase and Sale and receiving the Disclosure Statement. This period gives you time to review the documentation before your final commitment. If you purchase a condominium, you will almost certainly occupy your home for some time prior to the developer being in a position to transfer legal ownership, following registration of the condominium corporation. During this “interim occupancy,” the developer will likely charge a monthly occupancy fee. The fee should not exceed the amount of interest on the unpaid balance of the purchase price, the municipal taxes on the unit and the projected common costs allocated to the unit, all calculated monthly.
If you purchased long before construction starts, which is very common with high-rise condominiums in the GTA, your Agreement of Purchase and Sale may contain a “tentative occupancy date,” the developer’s best guess at the time, which can be extended. But at least 120 days before that date, the developer must notify you of a “confirmed date.” A confirmed occupancy date may be postponed, but only with adequate and formal notice. If you are not properly notified, you may be eligible for compensation for your living expenses up to $7,500.
The Ontario Ministry of Consumer and Business Services publishes brochures and pamphlets on a number of issues, including the
Condominium Act itself, newly revised in May 2001. You can view information on-line or get information about obtaining printed copies by calling 1-800-268-1142.
The Canadian Condominium Institute, a non-profit national organization interested in all aspects of condominiums, can refer you to other publications of interest, including the Condominium Handbook, which The Toronto Star has called a “must-read” for condo owners. Visit the Web site of the Toronto chapter of CCI at www.ccitoronto.org to order publications on-line or find other information, including recommended specialists in the GTA. Clicking on “Resources” will lead you to additional links that may prove of interest. Condominiums Ontario is an entire Web site (www.condo-ont.com) devoted to condominium resources. It also offers a forum where you can communicate directly with others who are contemplating a condo purchase or already own one.
