Top Tips When Buying A Condominium
There is a lot to know when you are buying a condo. Here is some information to get you going in the right direction.
Condo’s can offer a great lifestyle for those that want to take a more hands-off approach to home ownership. While many of the general upkeep and maintenance items may be included in your condo membership, there is much more to it. Let’s jump in and learn the top tips of owning a condominium.
What makes a Condo, a Condo?
Most people think that a condo needs to be in high-rise building but in reality, a condominium is a style of ownership that can come in many different shapes and sizes, including a townhouse, duplex, detached house or plot of land! When you buy a condo, you are purchasing a private dwelling called a “unit”, as well sharing ownership of common areas and assets of the complex. These common areas and assets vary from condo to condo, so it is important to do the proper research to discover what exactly you are buying into.
What are Condo Fees and why do I have to pay them?
Along with purchasing a condominium, you will also have to pay your portion of condo fees. The condo fees can include items such as upkeep and replacement (when necessary) of common elements, an insurance policy, utilities and services such as snow removal and professional management. What is included in your condo fees varies for each condo project, so research is necessary to confirm what exactly you are getting for your payments.
What is a Reserve Fund Study & Plan?
This is possibly the single most important thing to understand if you are considering a condo. Every 5 years, a third party will evaluate the components of the complex and make a plan for when each item will need replacement. This will make a financial plan to start saving for each item to ensure when it comes time to replace something there is money already saved to do it! It is important the complex is following the plan as set out for them, or there is a possibility of a special assessment.
What is a Special Assessment?
Special Assessments are dreaded and dirty words among condo owners… it means you’re getting a bill in the mail! When an unforeseen expense occurs, or there is a shortage in the reserve fund, a special assessment is levied. This can range widely in cost, depending on the issue, and can come in many scheduled intervals or all at once. At the end of the day, you will want to know if there is any talk of one coming your way before you buy into the complex.
What is the difference between Bylaws and Rules?
Bylaws and Rules govern how you will live in your condo. They can specify regulations on things such as pets, noise toleration, parking, the maximum number of occupants in a unit, items that can be on a balcony, etc. It is important for you to personally read the rules and bylaws, so you can determine if your lifestyle is a fit for the complex. You can’t just assume things when it comes to condo’s so you need to make sure that you do your homework upfront!
Should I have the condominium documents reviewed?
We strongly advise you to make your offer conditional to a document review and for you to hire a professional to do so. It is the best way to know what you are getting yourself into from the Reserve Fund, Bylaws & Rules and more. Yes, this is a cost but it may end up saving you dearly in the future.
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Buying a home is one of the largest financial decisions in life. That's why we believe you should be guided with the highest level of professionalism and knowledge. Our advisors will make sure you always have the right data, resources, and professional advice you need at every stage of the buying process, so you can be 100% confident in your home decision.