When you purchase a condominium, you own a private dwelling called a “unit” and it is registered in your name. If you purchase a parking spot with your unit, that will be registered also. You also share ownership of common elements and of the building which may include lobbies, hallways, elevators, recreational facilities, walkways, and gardens.
In addition to paying for your unit through means of a mortgage along with your property taxes, you are responsible for a monthly condominium fee. This covers the upkeep and replacement of the common elements you share with other unit owners, whether you use them or not. The fee may also cover the corporation’s insurance policies, utilities and services such as snow removal. A portion of your monthly fee will most likely be put into a reserve fund to cover maintenance and repairs needed in the future. The older the building, the more maintenance and repairs needed, and most of the time, higher condo fees. Condominium fees may have to be adjusted from time to time to reflect the changing costs of inflation and cost of living and goods sold. They may increase on an annual basis.
In some instances, if a major repair to the building needs to be made and the reserve fund does not have enough funds to cover, the extra costs may come out of pocket to the condo owners by means of special assessment, so be sure to check and see if the reserve fund is in good standing before purchasing.
Before buying, find out what restrictions apply to the building you are looking to purchase. For instance, restrictions may prevent you from parking a boat, in your parking spot or if you are allowed to place plants or a barbeque on your balcony. In rare cases, the condominium declaration and description(a basic document for condo owners describing their boundaries and common elements) may state a “no pets” rule.
Condo living is a turnkey, convenient lifestyle with positive and negative attributes I will discuss in Part 2. Condo living: Is it right for you?