The value of the condominium unit is really in the quality of the building and condominium board. If the building has high expenses coming, and the board has not prepared to pay, the nice $220,000 condo being sold online can be worth so much less. Their are tools are available for condo buyers in Edmonton to protect themselves.
It seems once or twice a year there are news headlines in our city of a building going through special assessments. Large bills being levied on unsuspecting condominium owners for work that needs to be completed on a building they own a unit in.
The work needing to be completed takes many owners by surprise, and these folks are left with time to pay or a payment schedule to pay for the work to be completed. In some circumstances banks and mortgage insurance companies learn of these levies and cease lending for people to purchase any units in the building. When this happens, less people have access to financing and the ability to purchase, and the value of the units in the building decreases.
The risk of Condominium Assessments to owners in a building are known long before an owner is ever asked to pay. There are engineering studies, reserve fund study’s and plans, and board minutes to name a few, documented for any prospective buyer to inspect. Most people do not bother with the state of the building nor the board until it is too late.
Prospective purchasers are wise to utilize a Condominium Document Review service, yet few do. Buyers can stipulate that the Seller provide a full, updated set of Condo documents to a buyer. This practice is so wise, it is pre-written in a Standard Form Condominium Purchase Contract. The Seller provides a full set of documents listed explicitly on the contract, and the buyer has X amount of time to review or pay someone to review them before committing to the purchase. Your agent can help and inventory the documents you are provided, so these documents match what the Seller and their agent have commited to provide you. Incomplete and omiited information is just as dangerous unchecked infromation.
A good agent can help too. Before a offer is even written your agent can
- Pull sales history in the building, some notoriously troubled buildings haven’t had a sale in years. This can be a red flag up front.
- If there are sales, ask an agent who has done a sale to share those documents to get a preview ( Active Sellers will rarley have documents ready for buyers as they often have to pay out of pocket to provide them , Sellers will often wait to get a good offer)
- Talk to the property manager and ask if there is a history of significant problems or if there are any upcoming ( this conversation should be tactful as owners will not like any manager talking poorly about their building)
- There areknown buildings throughout the city that have good and poor reputations. An experienced agent can scrub out problem buildings before getting attached, or worse yet, purchasing a very expensive lemon.
Following these steps, its hard to pick a lemon. I hope this was helpful, If you’d like to wrap condo’s, I’m happy to chat.