If you’re planning on buying a condo, there are some things you need to know. There are a whole host of things of which Canadians should be aware of when it comes to choosing the right condo and the right developer.
Status certificates are one of those things. Their importance can’t be overlooked since they will let you know of the financial and legal health of the corporation from which you’re purchasing your unit. These certificates are governed by various acts that oversee condominiums across Canada in all provinces. They usually come in the packages presented to condo buyers.
Why Are They So Important?
A certificate will let you know how the building will be managed. Knowing something about the financial health of the building in which you’ll be living will go a long way in helping you to make some decisions, including how you manage your own finances.
Status certificates will outline any lawsuits that are pending against the condo company/developer. Getting involved with a company that is in the middle of a nasty litigation suit might help you decide whether or not you want to get involved with such an outfit.
If you’re planning on purchasing one or more units as investments, buying these from a company involved in legal wranglings might not bode well for you when you go to sell. Most buyers don’t want to be involved in such lawsuits, even indirectly.
A Financial Window
The certificates will also help you in creating an all-encompassing monthly financial budget since they will outline what you’ll need to shell out for common expenses in the way of condo fees. It will tell you how much money is in the building’s reserve fund, which will show if the corporation is able to take care of things like major repairs. If the reserve fund falls short, owners will have to cough up money to cover these types of things.
Also included in status certificates are issues dealing with building insurance, and condo bylaws and rules that impact unit owners.
No one wants to live in a poorly-managed building. A status certificate will show if management is doing a stellar job or falling short. A building that isn’t in ship-shape order physically and financially may turn out to be a nightmare for a prospective purchaser.
Buyers are encouraged to look over a status certificate well before signing on the dotted line. With a lot of your hard-earned money on the line, you’ll want to ensure you’re buying not only the unit of your dreams, but in a building that has top-notch management.