11 Tips for Condo Buyers
Tuesday Apr 05th, 2022
Whether you are a first-time buyer, down-sizing or are simply ready for change - buying a condo is a big life event. There are many things to consider throughout your search, before making an offer and through the conditional period. At the top of the list - team up with a specialized condo buyer’s agent to set yourself up for success.
Check out these 11 tips to learn more about what to consider before you buy.
Tip #1 - Should you buy in a newer building or an older building?
There are advantages and disadvantages to both. Newer buildings tend to have smaller floor plans but lower maintenance fees, while older buildings offer larger suites and less renters. Here’s a few other features you may find when considering the age of the building you want to buy in.
- Contemporary design
- Smaller floor plans
- Lower maintenance fees
- State-of-the-art amenities
- Move-in ready
- Typically a higher percentage of renters
- Classic style
- Larger floor plans
- Higher maintenance fees, but may include more/all utilities
- Varied amenities
- Can renovate to taste
- Typically a higher percentage of owners
Tip #2 - What conveniences are nearby?
If you take public transportation, find out where the nearest bus or subway stops are. Are there grocery stores within walking distance? Do you need a neighbourhood vet for your fur babies? The location you choose to live in is extremely important when considering the many aspects of your life, and choosing locations conducive to your lifestyle will make you happier in the long term.
Tip #3 - What’s the demographic in the building?
Most people want to live in a building with people similar to them so it’s important to assess the demographic of any building you are considering. Are most residents retired? Do they have families? Are there many professionals, or does it feel like a college dorm? You want to make sure that whatever the demographic of the building is, it fits in with your lifestyle.
Tip #4 - What’s the percentage of renters in the building?
Most Toronto condos have at least a 30% rental ratio; however, some of the newer buildings have a much higher percentage. Why does this matter? Some renters don’t treat the building as well as owners, so a large number of renters will likely create more wear and tear, which will eventually cost owners more. The property manager should have a good idea of the building’s ratio of owners to renters.
Tip #5 - Talk to residents in the building
When you are out viewing condos with your Realtor, take the time to chat with people in the elevator, the concierge, and ask them about the building. They will certainly know what issues may exist and it’s a great way to get an unbiased opinion of what it’s truly like to live in the building.
Tip #6 - Tour the amenities
If amenities are important to you, make them a stop on your tour of the building. Check out the pool, gym, and other common areas available. Know the location of the amenities and if they are shared by more than one building. If you go to the gym every day, get a feel for how crowded it may be. If you like to swim, knowing if you need to go outside to cross the street to the sister building to use the pool may be a factor for you.
Tip #7 - Inspect the parking spot and locker
If you’ve honed in on a condo you are interested in putting an offer on, it makes sense to have a look at the other elements of your purchase. Make sure your parking spot has easy access, is well lit, and check out the proximity to the building’s entrance. Although you cannot make any changes to the parking spot or locker location that comes with your condo, at the very least, know what you’re buying.
Tip #8 - Check all appliances
When you feel that you have found the right condo, check out the appliances. A thorough Realtor will ensure that your offer includes a clause to ensure all appliances are in good order; however, it is a good idea while you’re in the unit to open the fridge, turn on the stove, and test the dishwasher and laundry appliances. It’s better to learn of any issues in advance and have them resolved by the seller, instead of realizing there is a problem after moving in.
Tip #9 - What is a Status Certificate and why it is important
The status certificate, which is ordered and paid for by the Seller, gives the Buyer and the Buyer’s lawyer an opportunity to review a number of key facts during the conditional period in an offer. If the status certificate turns up any major concerns, you simply do not waive your status condition, ultimately backing you out of your purchase. The status certificate will showcase a building’s financial health; it’s comprised of all the financial statements for the condo corporation. When you are purchasing a condo in a hot market, often the Seller will have the status certificate ready for you either in advance of submitting your offer or upon acceptance of your offer. The status certificate will show how much money is in the Reserve Fund. Every three years, condo corporations hire an engineering firm to perform a Reserve Fund Study. This Study costs out repairs such as the mechanicals of the building, the roofing, and other common areas of the building. This matters to you because if the reserve fund is insufficient to cover the needed repairs, the condo board will most likely have to ask the owners of the units to pay a special assessment to bring the reserve fund up to where it should be.
Tip #10 - What is a Special Assessment and how it could affect you
A special assessment occurs when the condo corporation realizes there isn’t enough money in the budget or the reserve fund to cover repairs for items such as plumbing, the roof, or elevators. They divide the costs among the owners so that each owner will pay an amount in proportion to the size of their unit. This special assessment amount will need to be paid by the Seller before closing their sale, or by the Buyer coming in. Be cautious if the status certificate reveals there is an impending special assessment.
Tip #11 - Do you need a home inspection?
Typically hiring a home inspector is money well spent if you are purchasing a house, especially an older one. In condominium buildings, the majority have mechanical rooms that are maintained by the building and not the responsibility of a resident. However, if the condo unit you are purchasing contains any mechanicals such as a furnace or heat pump within it, a home inspector might be helpful in learning the functional health of the equipment and how soon this equipment might need replacing.
Remember, your Realtor has your best interests in mind and will provide guidance during every step of the process.