A Word About Resale Condos
Here are some tips you should keep in mind when it comes to buying a resale condo, meaning one that is already built.
Did you know?
When you buy a resale condo, you:
do not have a cooling-off period to cancel the purchase. (These are10 days in which you have the option to cancel when you purchase pre-construction)
have to request to receive a copy of the status certificate.
The status certificate
You should consider making your offer conditional on your satisfactory review of this certificate. The status certificate contains a statement on the status of the current owner’s condo fee payments, the condo corporation financial status, the declaration, by-laws and rules, and the condo's reserve fund, along with other important legal information about the corporation.
I recommend that buyers of resale condos get a home inspection. The inspection will help you make an informed decision before buying. It will help you understand the condition and value of the individual unit and the building itself.
Before you buy a unit, talk to your real estate agent & your lawyer about:
Is the budget in a deficit or a surplus? It is important to know the financial health of the corporation to help assess what your condo fees will be.
Has the corporation levied any special assessments? (a special assessment is a type of common expense fee that is in addition to the regular condo fees to help pay for things like unexpected major repairs or shortfalls in the reserve fund)
Is the corporation involved in any lawsuits? If so, what is the case about and how much money is at stake?
Just remember to be clear about what is and isn’t included in the purchase price so you can compare overall costs with other condominiums. For example:
Are there amenities, such as pools and parking, and how are they paid for?
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?
Investigate whether there are any “hidden” costs. For example, some developers take out long-term leases on building fixtures, such as furnaces, to save on capital costs. These costs are inevitably passed along to owners.
Ask what municipal services, such as garbage pickup and snow removal, the condominium receives. Even though you pay for these services through your property taxes, condominiums sometimes have to assign this work to contractors and you may pay for them twice.
Check what, if any, new home warranty coverage remains on the unit.