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What Is a Condominium?
When people refer to a condominium, they are typically speaking of a form of ownership as opposed to a place to make a home. They are often thought of as being high-rise residential buildings, but could be applied to townhouse complexes, individual houses and low-rise residential buildings. In British Columbia they are known as strata and in Quebec they are referred to syndicates of co-ownership as opposed to the condominiums in Ottawa.
Condos consist of two parts. The first part is a collection of private dwellings called “units”. Each unit is owned by and registered in the name of the purchaser of the unit. The second part consists of the common elements of the building that may include lobbies, hallways, elevators, recreational facilities, walkways, gardens, etc. Common elements may also include structural elements and mechanical and electrical services. The ownership of these common elements is shared amongst the individual unit owners, as is the cost for their operation, maintenance and ongoing replacement.
Each unit owner has an undivided interest in the common elements of the building. This ownership interest is often referred to as a “unit factor”. The unit factor for any particular unit will generally be calculated in proportion to the value that the unit has in relation to the total value of all of the units in the condominium corporation. The unit factor will tell you what your ownership percentage is in the common elements and will be used in calculating the monthly fees that you must pay towards their upkeep and renewal.
The creation of a condo is regulated by provincial or territorial condominium legislation and municipal guidelines. It can be created in many different ways. In some provinces, a developer, or other interested party, may register a declaration to create a condominium, while in others, an application may be made to have title issued for the units pursuant to an “approved plan of condominium.” The operation of condominiums is also governed by provincial or territorial legislation and the condominium corporation's own declaration, by-laws and rules.
Once a condominium corporation has been established, a Board of Directors, elected by, and generally made up of, the individual condominium owners, takes responsibility for the management of the corporation's business affairs. There is usually a turnover meeting where this transfer of responsibility takes place. Each unit owner has voting rights at meetings. Your voting rights will generally be in proportion to your unit factor.
Your Guide to Ottawa Condos
Types of Ottawa Condos
Residential condominiums tend to be:
• high-rise or low-rise (under four stories),
• town or row houses,
• duplexes (one unit over another),
• triplexes (stacks of three units),
• single detached houses,
• stacked townhouses or freehold plots.
There could also be mixed- use condominiums, where part of the building is used for commercial use and the other part used for residential life. There are a variety of sizes and diverse features and condos Ottawa condos could be found in almost every price range.
Choosing The Right Ottawa Condo
There are various sizes and kinds of building forms when looking at condominiums such as office or warehouse space that was converted into condominiums, re-sale condominiums; and newly constructed condominiums. Potential buyers of the condominiums need to be aware of the differences between the condominiums and how it will affect their lifestyles.
New, Re-Sale or Conversion—What Are the Differences?
The term “New” is applied to condominium buildings that are either under construction or have been newly completed, while the term "Conversion" can mean the building was previously used for something else but has been, or is to be, renovated for residential use. For example, many loft style condominiums are converted from former commercial or industrial buildings. Conversions may also refer to the changing of units from rental units to condominium units. Both new and conversion condominiums are usually purchased from a developer. “Re-sale” condominiums are units that have already been occupied, typically in older buildings, and are offered for sale by the current owner.
Newly constructed condominiums can be an attractive option for the prospective owner. They offer all of the benefits of a newly constructed building (fresh appearance, modern fittings, surfaces, elevators, appliances) while providing unit owners with the chance to customize their units.
You can purchase a new condominium from the developer either before or during its construction and well before the condominium corporation is formed. A developer may have some unsold units available after the condominium has been completed and registered. In some market conditions, a developer may wait to sell a majority (or all) of the units before registering the condominium corporation or starting construction. Deposits are typically required to secure, or reserve, a condominium unit in a new development.
When looking over the drawings and specifications, ensure that you are aware of the basis of any floor area measurements: do they reflect the actual floor area of the unit or do they include the exterior and interior wall floor space areas as well? You should also be aware of plans to reduce the ceiling height in any locations in the unit to accommodate ductwork and other mechanical and electrical services. This can have an impact on the aesthetics of the unit and affect the eventual location of lighting fixtures and furniture as well as wall decorations and fittings. Similarly, be aware of the future location of heating and air-conditioning equipment, ventilators and hot water heaters as this can affect the availability and aesthetics of the space in your unit.
Other important issues to consider in the purchase of a new condominium are related to construction quality. Some key questions to consider include: Are there any special provisions to limit noise between units? How are the units heated, cooled and ventilated? How are odours controlled? Is the building energy-efficient? Who operates and maintains the heating and air conditioning systems? What options are available for suite wall and floor finishes, cabinets and fixtures?
You should also be aware that the view from your unit might be subject to change if the building is being constructed in a newly developed area or as a part of a larger complex. Be sure to ask about the future construction plans for adjacent open areas as your view may change significantly with the construction of a neighbouring high-rise.
When shopping around for a new condominium, it is important to ensure that you are aware of what is and what is not included in the purchase price. For instance, are there amenities such as pools and parking? How is access to such amenities paid for? Are finishes within the units included in the purchase price? Are there other charges over and above the purchase price you should be aware of? Are utilities (gas, electricity and water charges) covered in the monthly condominium fees or not? All such questions must be considered to ensure that you can compare the overall costs associated with different condominiums.
Rules and regulations for new condominiums vary from province to province, therefore it is a good idea to check your provincial legislation. New home warranties are often available for newly constructed condominiums—make yourself knowledgeable about what the warranties cover and for how long.
Quite often, there is a lengthy wait before a new condominium project is completed and you can move in. It is always important to evaluate the current state of the construction project. 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.
Agreements of purchase and sale may contain provisions that allow the developer to extend the dates for making the units available for occupancy. This can be problematic if you have made arrangements to vacate your existing housing by a specific date based on the original closing date. If this is an important consideration for you, ensure that you are aware of any occupancy delay clause in your purchase agreement and plan accordingly. You should also check your provincial homeowner protection legislation to learn your rights in cases where agreed upon occupancy dates are missed.
In some jurisdictions, in compliance with legislation, the developer of a new condominium must provide you with a “disclosure statement” before the sale agreement is binding. This includes, among other things, a summary of the condominium’s features/amenities, the condominium’s governing documents and budget for the first year after registration. This should give you some indication of the rules, regulations and financial situation of the condominium corporation before you buy into it.
Your province may have legislation that provides a “cooling off ” period during which buyers can review the information contained in the disclosure statement and rescind their agreement to purchase if they are not comfortable with their original purchase decision. Ensure you obtain and carefully review the disclosure statement within the specified timeframe. If a cooling off period is not provided for in your provincial condominium legislation, try making it a condition of your offer to purchase to allow you to have a few days to review this information.
New Home Warranties:
Most provinces have new home warranty programs, which include new condominium projects. Warranty programs are put in place to ensure that new dwellings are properly constructed and that they meet the construction specifications. Warranty programs provide for the reporting of defects in, or omissions of, warranted elements within specific timeframes. Often, the developer makes arrangements for independent inspection companies to audit the condominium, individual units and common elements within the first year of construction. The developer is responsible for correcting defects in, or omissions of, warrantied elements that occur during the warranty period. Should the developer default on this obligation, the warranty program can provide funding to correct deficiencies in warranted elements up to a specified maximum dollar amount. All of the owners of new condominiums are expected to cooperate with the new home warranty inspections and to report any defects or omissions in their units. You should be aware that new home warranties do not cover every item that one might construe as a defect. Be sure you are aware of what the warranty does and does not cover, and for how long, before making a claim. New home warranties may also protect the deposit you place on your new condominium, up to a maximum amount, in case the developer cannot, or will not complete your unit, through no fault of your own. Check with your provincial or territorial government to find out more about the warranty program as program coverage varies from province to province.
Advantages of buying a new condominium may include:
• A lower purchase price (depending upon market conditions)
• More choice of locations within the building (if applicable)
• A broader range of options and/or upgrades
• Newer buildings have less risk of having to undergo costly, noisy and intrusive repairs and renovations
• New home warranty protection
Disadvantages of buying a new condominium may include:
• Because construction may not have started, you cannot “see” what you are buying and must rely on artist sketches and floor plans (which may change). Be sure to have the unit’s boundaries, location, finishes, materials, chattels, etc. clearly specified in the purchase agreement.
• Your initial deposit will be tied up for the duration of construction.
• Financial institutions may not give you a mortgage on an unregistered condominium.
• Construction of your unit may not be completed by the expected date.
• You may move into your unit while construction continues in others—this can be noisy and disruptive.
Buying a conversion condominium in the early stages of development is similar to buying a new condominium. The biggest difference is that the exterior of the building (or building envelope) already exists. The majority of the construction project usually consists of modifications to some of the common property components and the creation of individual unit spaces. The transfer of the title of ownership may not take place until after occupancy. You should check with your provincial government to find out if the warranty program in your province covers condominium conversion projects.
Advantages of buying a conversion may include:
• Many of the same advantages of buying a new condominium apply to conversions, (e.g. choice of unit, opportunities for upgrades, etc.).
• Some conversions offer unique designs, (e.g. lofts).
• Converted units are often, but not always, somewhat less expensive than a comparable sized new unit.
• Conversions may be located in established and desirable parts of cities that are well served by entertainment, educational, transit and other amenities.
Disadvantages of buying a conversion may include:
• As new home warranty programs may not apply to conversion condominiums (check with your provincial program), there may not be construction warranties other than that offered by the developer.
• The building structure and perhaps some of its internal components will already be old, which may mean major (hence costly) repairs may be needed sooner rather than later. This could be problematic if the condominium corporation has not had sufficient time to build an adequate reserve fund. This may have an impact on condominium fees and extraordinary charges to the unit owners.
• Occupancy dates can be changed due to construction delays.
One of the advantages of purchasing an existing condominium is that you get to see the unit, building and grounds before you make your purchase. You also have the opportunity to meet other unit owners, speak with the Board of Directors and ask questions to the property manager. Consider the age of the building and what repairs have been made and when. Ensure that the condominium is well maintained and managed. All of this will provide you with valuable information as to whether or not the condominium is right for you.
When making an offer on a re-sale unit, ensure it is conditional upon obtaining, and having the time to review, the corporation documents available to the purchaser under provincial legislation, including an estoppel or status certificate. There may be a fee for this certificate, but it will give you the opportunity to review information including the condominium’s governing documents, financial statements and insurance coverage. It is important to thoroughly review these documents, as once you sign the offer to purchase you are contractually bound and cannot change your mind if, for example, you later find out the condominium does not allow pets or requires major repairs. In Alberta, there are services available to help you with the review of condominium document packages. In other provinces you should ask your lawyer or notary to help you review them. Provincial new home warranty programs do not protect deposits made when buying a re-sale condominium and won’t provide protection for construction defects once the applicable warranty periods have expired. Therefore, it is important to have the purchase of the unit contingent upon the Your Guide to Ottawa Condos
satisfactory inspection of the unit and building by a qualified home inspector, professional engineer or architect.
Advantages of buying a re-sale condominium may include:
• You get what you see.
• There are no lengthy waiting periods before you can move in unless provided for in the condition of sale.
• Deposits are often much lower for re-sale purchases and there is no GST.
• You can check out the condominium “community” in advance to see if the corporation is well run and the people who live in it are compatible with your needs and lifestyle.
• Older condominiums can have larger unit sizes.
Disadvantages of buying a re-sale condominium may include:
• Fewer options with regard to choice of unit (within the building), decorating, or upgrades.
• Older re-sale condominiums may require more maintenance and repair than new ones.
• The amenities that you may find desirable (e.g. a workout room or whirlpool, high speed Internet connection, security features) may not be available.
• Older resale units may not be as energy efficient due to different construction standards in newer buildings.
• Major repairs may be coming due that will require extra charges to the unit owners if the reserve fund is underfunded.
• You will only receive the portion of the new home warranty that has not yet expired.
Buy or Rent an Ottawa Condo?
When buying an Ottawa condominium, a person would own the unit, along with a percentage of the common property elements allocated to the unit. The percentage of the common elements and the boundaries of each unit that is owned may vary between condominiums. This depends on how they are specified in the condominium’s governing documents. There are times where the unit boundary can be at the backside of the interior drywall of the unit’s dividing walls or could be the center line of the unit’s wall. At the time of purchase, it is important to consider the boundaries of your condominium, especially if there are alterations and renovations as a potential part of the purchase. Equipment, systems, finishes and other things that are contained only in an individual unit are included. The right to use one or more parking spot and storage areas may be included even though a person seldom owns that space.
For a freehold condominium (or a bare/vacant land condominium), the unit may be the entire house including the exterior walls, the roof and in some cases, the land surrounding the structure. Prior to making a purchase, you may wish to hire a professional surveyor to review the site plan for the condominium corporation so you know exactly where you unit’s boundaries lay.
Components of building systems that serve more than one unit, such as structural elements and mechanical and electrical services, are often considered part of the common property elements, particularly when they are located outside of the unit boundaries specified in the condominium’s governing documents.
There may be some parts of the condominium complex that are called “exclusive use common property elements.” They are outside the unit boundaries, but are for the exclusive use of the owner of a particular unit. Balconies, parking spaces, storage lockers, driveways and front or rear lawn areas are common examples of exclusive use common property elements. It is important to be aware of any exclusive use common property elements before you make an offer to purchase a condominium. While these spaces are exclusive to your use, there may be restrictions on how and when you use them. For instance, you many not be able to park a boat, RV or commercial vehicle in your assigned parking spot. There may also be restrictions on what you can place on your balcony.
Ottawa Condo Checklist
Before a person buys an Ottawa condominium, there are questions that should be answered so that the proper decision could be made. The person needs to ask about the location of the condominium, the amenities, the condominium rules and regulations, affordability, the building, the condominium corporation, and the community and lifestyle.
• Is the condominium in the neighbourhood I want?
• Is there a school nearby?
• Is it accessible by public transit?
• Is the commute time to work acceptable?
• Is it close to amenities (e.g. shops, theatres, restaurants, etc.)?
• Does the condominium have recreational facilities?
• Does it have an exercise room?
• Does it have a pool?
• Does it have a party room?
• Does it have a convenience store?
• Does it have a children's area?
• Does it have parking available?
• Indoor or outdoor?
• Guest parking?
• Does it have suitable storage available?