Before you purchase a new or resale condominium, you should consult with a number of advisors and condominium experts. The following questions will help you assess their qualifications. Of course, condominium markets vary and the intensity of a particular market can influence how much time a buyer may choose to take to question experts and review documents.
QUESTIONS TO ASK A REAL ESTATE AGENT
How Much Experience do you Have in Helping Clients Buy Condominiums?
Buying a condominium is very different from buying a traditional house so it’s important that your agent specializes in condominiums. Ask the agent how many condominium buyers she or he has represented in the last 12 months and be sure to get three buyer references (who are unrelated to the agent). If you’re buying a new condominium, an experienced agent may be able to help you to secure upgrades and better terms from the developer.
Will you Represent my Interests Only?
You can opt to deal with the vendor’s real estate agent, but you should really enlist one who will act only on your behalf.
How Familiar are you With the Neighbourhood(s) in Which I want to Buy?
A neighbourhood specialist will know the desirable areas and can readily advise you on pricing as well as the benefits and drawbacks to the neighbourhood.
How Much Time will you Give me to Review Important Documents?
There’s a lot of paperwork when you buy a condominium. Ensure that you and your lawyer have plenty of time to go over it before signing.
When Drafting a Purchase Offer for a Condominium, What Clauses do you Normally Include to Protect the Purchaser?
A real estate agent skilled in condominium purchases should know to include protective clauses unique to condominium buying, such as making the offer conditional upon a satisfactory review of the condominium's documents. In jurisdictions offering this service, you may want a provincial condominium review specialist to examine the documents.
Are There any Fees or Charges I Need to Know About?
If you deal with the vendor’s agent, there should be no charge to you, as the agent will be paid a commission by the vendor. An agent acting exclusively for you should not charge a fee because he or she normally shares in the vendor’s agent’s commission.
QUESTIONS TO ASK A LAWYER
How Much Experience do you Have With Residential Condominium Transactions?
Ensure that the lawyer specializes in residential (not commercial) real estate law and has plenty of experience in reviewing condominium offers to purchase, and purchase and sale agreements.
- Have you dealt with this developer before?
- It’s advantageous if your lawyer has some knowledge of the developer of the project.
- Do you deal with both developers and condominium buyers and sellers?
- Law firms often represent either developers or condo buyers and sellers, but not both.
At What Point do you Get Involved in a Residential Condominium Purchase?
Find out the key stages in the purchase process when your lawyer will be needed.
What Parts of a Purchase Agreement Tend to be Problematic?
An attorney skilled in condominium law should be able to identify areas in a contract that warrant special attention.
What will You Expect from me?
Find out what your role will be in the process and what documents you’ll need to provide the lawyer.
Do you Charge a Flat Fee or an Hourly Rate?
It’s best to know this ahead of time so there are no surprises. If the lawyer charges by the hour, ask for an estimate of his or her total time so you can work this into your budget.
What Costs will be Incurred at the Time of Closing or Before?
If you need a mortgage, you may have to have an appraisal done. Land transfer tax must be paid at closing, if applicable. A lawyer should be able to provide a complete list so that you can be prepared.
QUESTIONS TO ASK A PROPERTY MANAGER
A good property manager can have a significant impact on the quality of life in a condominium community. He or she ultimately serves the owners so it’s in your best interest to find out as much as possible about this individual and/or company before purchasing in a particular building.
Property managers also tend to be very busy people so you may want to set up an appointment with one by phone or e-mail. Here are some questions to ask a property manager to get a better idea of his or her experience, personality, professionalism and communication skills.
- How long have you been the property manager for this condominium? How long have you been working in the property management field? How are vacations and other time away from the job covered?
- If employed by a property management company, how long has the company been in business? What are other properties managed by this company?
- Can you provide concrete examples of where your organizational skills and follow-through benefitted this condominium community?
- How have you shown leadership when meeting the needs of residents, the board of directors, staff and contractors?
- How do you communicate with owners on a timely basis? E-mail? An interactive website?
- Can you give an example of where you have learned from a mistake on the job?
- What business skills and experience do you bring to the position?
- How has your attention to detail made a difference in the building’s day-to-day operations?
- Have you, or are you working toward, the Registered Condominium Manager designation?
- How do you stay current with changes in the industry?
QUESTIONS TO ASK A CONDOMINIUM’S BOARD OF DIRECTOR
Owners who sit on the board of directors have a close-up view of the condominium corporation. While their knowledge of legal, financial and property management issues will vary, it’s worth asking them the following questions if you have the opportunity.
How Much Money is in the Reserve Fund (and How is it Invested)?
You’ll want to ensure that the condo has sufficient funds to cover major repairs and renewal projects.
Have There been Special Assessments in the Last Five Years and, if so, What Were They for and How Much did They Cost? Are Any Other Special Assessments Expected in the Next 10 to 15 Years?
Special assessments are sometimes necessary but frequent, costly ones may indicate a deteriorating building or poor financial management.
What is the Turnover Rate in the Complex?
This will give you an idea of how happy people are living there.
What is the Turnover Rate Among the Board of Directors?
Repeated resignations among members may point to friction within the board.
How Familiar are Board Members with Condominium Legislation?
Provincial and territorial condominium legislation covers many important aspects about how condominiums operate, including the powers of the board of directors.
Have There Been any Situations in Which the Board has Drawn Upon Professional Help?
Board members’ knowledge of legal, financial and property management issues may be limited so it may be necessary to consult professionals occasionally.
Is the Condominium Corporation Involved in any Lawsuits?
If it is and it loses the lawsuit, a portion of all of the owners’ maintenance fees could go toward paying a settlement. This is one of the reasons why you should review the corporation’s liability insurance coverage.
Has the Condominium Corporation Made any Claims on its Insurance Coverage in the Last Five Years? If so, What for?
Insurance claims can tell you more about the condition of the property and may account for steeper condo fees.