Want To Buy A Condo? Some Things You Should Know

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This weeks’ blog is a Q&A we read about with real estate experts, who gave some advice on some important things to consider before signing a purchase contract for your new condo.

Q: Who should I consult with when I want to purchase a condo?

The CMHC suggests that prospective buyers consult with a real estate agent, a lawyer, an engineer or inspector and financial advisors before making a decision on a condo. Fair point made about not going solo there!

“Because buying a condominium is different from buying a traditional house, it’s a good idea to enlist the help of professionals who specialize in condominiums,” writes the CMHC.

Real estate agents say prospective buyers should also speak with the people already residing in the building by knocking on doors or connecting on social media to find out more about life at the condo. They add that “A condo, in theory, is a city within a city. Neighbours are the most important thing when you’re buying a house, and that’s the same here. Instead of living the next plot over, you’re sharing a small wall with neighbours.”

Q: What questions should I ask if I plan to buy a newly-built condo?

What’s included in the price of the unit.
If common elements like parking or pool access included?
Finishing touches to the interior of the unit?
Are utilities separate or part of the condo fees?
How long the wait will be until they can move in.
The building’s new home warranty

The CMHC believes it’s always important to evaluate the current state of the construction project and consider whether or not it seems reasonable that the project will be completed by the date set out in the purchase agreement from the developer before making your moving and financing arrangements.

Make sure to properly audit the purchase agreement, as there may be clauses that allow the developer to push back the move-in date.

Another important document to review is the disclosure agreement. This includes information about the condo’s amenities, governing documents and budget for the first year.

But according to an Ottawa real estate lawyer buyers should take those budgets with a grain of salt. “I would expect it to be a little bit more,” he says of the condo’s first year budget, adding that a developer might put their lowest expectations rather than their highest in order to attract buyers.

Ontario law allows buyers have the right to cancel a sale within 10 days of receiving the fully-signed disclosure agreement, or within 10 days of any significant change to the agreement. If the buyer cancels within this “cooling off” period, the developer must return the deposit.

Q: What questions should I ask if I plan to buy an older unit?

Adding to the above statement, in Ontario law, buyers looking for an older unit do not have the same “cooling off” timeframe as people looking at new units do.

Buyers need to pay for a status certificate, which discloses the rules and basic information about the condominium, plus any financial or physical information from previous inspections and studies. Standard.

“Your lawyer will order it and go through it with you,” says the real estate agent. He also warns the certificate is “about an inch thick”!

If a buyer is still unsure about any of the physical or technical aspects of the building, the CMHC recommends hiring an inspector with condominium experience and credentials from the Canadian Association of Home and Property Inspectors or a provincial license.