Buying a condo is more than just picking a layout. You are entering into a legal and financial partnership with every other owner in the building. To protect your investment, you must look past the granite counters and evaluate the health of the corporation.
Get the Status Certificate
The most important step for any condo buyer is reviewing the status certificate. This document gives you a snapshot of the building’s financial and legal standing. Have your lawyer check it for any “special assessments.” These are extra, often large, payments owners must make for major repairs like roof work or elevator overhauls. If the certificate shows a deficit or an upcoming levy, you might want to reconsider your offer.
Check the Reserve Fund
Every condo corporation must have a reserve fund. This is a savings account for future major repairs. In Ontario and many other provinces, the board must update a reserve fund study every three years. Ask if the current balance matches the study’s recommendations. If the fund is low, your monthly fees will likely climb fast to make up the gap.
Ask About Rules and Restrictions
Condo living comes with bylaws that dictate your lifestyle. Do not assume you can bring your dog or rent out your unit on a short-term basis.
- Pets: Some buildings have weight limits (e.g., under 15 kg) or limit the number of pets.
- Parking and Lockers: Confirm if you own your spot or if it is a “right to use.” Check the physical spot to make sure your vehicle fits.
- Renovations: You often need board approval for simple changes like flooring, as certain materials cause noise issues for neighbors.
Review the Maintenance Fees
Understand exactly what your monthly fees cover. Some include heat and water, while others require you to pay all utilities separately. Ask for the history of fee increases over the last five years. If fees stayed flat for too long, a massive jump is likely coming soon. Keep in mind that older buildings often have higher fees as mechanical systems reach the end of their lifespan.
Investigate the Community
Ask about the ratio of renters to owners. A high number of tenants can sometimes lead to more wear and tear on common areas and lower engagement in building governance. Visit the building at different times of day. Listen for noise in the hallways and check the condition of the gym or pool. If the common areas look shabby, management is likely falling behind.
