Research Will Ensure Sound Condo Purchase

A Calgary Herald Special Advertising Section

Knowledge is your best friend when it comes to buying a condo, and the more you know, the fewer surprises there are after you are given the keys, says condominium experts.

Newly minted condo buyers need to understand their role in the maintenance and operation of the condominium association, says Bernie Winter of Condo Check Condominium Support Services Inc.

“You become a shareholder in a corporation,” she says.  “The corporation has liabilities and you are responsible for your part.”

Winter says it’s up to you to keep track of decisions made by the condo board.  “You have to read the minutes of every meeting.”

Checking the minutes before you move in is a good way of gauging the personality of a condo development, says Condo Check general manager Louise Challes.

“You can often tell if the building has serious issues,” she says.

Once you have made an offer to purchase, you have he right to inspect the minutes from past board meetings, ways Winter.  “You also have the right to look a finances,” she says.

Buyers need to be familiar with how condos work, says Marlene Swinton, a realtor with Re/Max Realty Professionals.  “It’s important to know what you’re buying into.”

Swinton recommends potential buyers make use of consulting services such as Condo Check before committing to a purchase, adding such services help ensure that you make a fully informed buying decision.

“You need to know what the rules and regulations are,” says Swinton.  “You need to know what your individual responsibilities are to the condo as well as what the condominium board and the management company’s responsibilities are to you.”

For example, Swinton says, many condominiums do not allow pets, while others have a minimum age requirement.  There are cases of people buying condos and finding out about these rules after the fact, she warns.

Buyers need to understand condo fees, and what is covered by them, says Barry Kozmyk, managing partner with Millennium Condo Gallery.

“Condo fees really come down to three key areas – gas, electricity and insurance,” says Kozmyk.  “Amenities also have a huge impact.  If you want a pool, 24-hour security, concierge…expect higher condo fees.”

Winter cautions against factoring in fees when making a purchase decision.

“You should not be shopping for fees,” she says.  “You should look for properly run corporations, who know what the costs are and whey they will be”

“You should look at the condo’s budget and ask yourself, does this budget make sense?  Developers advertise lower fees, but too many people shop based on fees rather than whether the corporation is run properly.”

Challes says with continually rising utility and insurance costs, condo buyers should budget for at least a nine to 15 per cent increase in fees each year, she says.

“Buyers think it is a ‘fee’, but it’s a contribution to your investment for maintenance and services,” adds Winter.

The Condominium Property Amendment Act of 2000 requires condo associations to have a reserve fund.  “It has been very helpful to the consumer as it requires condo associations by law to review…what has to be upgraded and replaced,” says Kozmyk.  “Is there enough money in the reserve fund?  It helps prevent the shock of something not having been budgeted.”

The condo lifestyle is not for everybody, says Kozmyk.  “You shouldn’t buy a condo if you’re planning to have your kids play basketball in your living room, or if your 22-year-old wants to practice the drums.

“There has to be some give and take.”