Condos, carbon and contracts: the challenges ahead.
If you’re a condo owner, a buyer or seller, a professional REALTOR®, a Board member or a Property Manager, hold on tight. There’s some turbulence ahead.
Let’s talk about the AREA (Alberta Real Estate Association) condominium purchase contract.
Amendments to this contract have been implemented and it is safe to say that there are strong differing opinions about the various provisions that have been amended, removed or expanded upon. I speak strictly from the perspective of a condominium corporation disclosure document reviewer, or consultant, who believes that the amendments specific to condominium disclosure documentation (section 8.2) bode well for Alberta consumers. Condominium sellers (their Boards of Directors and/or Property Managers) are now required to provide information such as
A)a copy of the most recent approved and most recent draft minutes of the Annual General Meeting.
B) a copy of the minutes and draft minutes of meetings of the Board of Directors of the corporation for not less than the past 12 months.
C) a copy of the Condominium Additional Plan Sheet Certificate (CAD, or CADS).
D) a copy of any proposed Special Resolution awaiting a vote.
E) a copy of any Special Resolution that has been passed, but not yet implemented.
F) a copy of any easements, covenants and restrictions (ECR) agreements.
G) a copy of any other building or site report such as a building assessment report, building envelope report, geotechnical report, technical or performance audit.
This section of the contract also requires the seller to provide an extension to the condition date, should the seller decide, or be forced, to obtain these documents by other sources. I am no stranger to asking these questions or requesting certain reports when documents suggest that they exist. Until now, condominium corporations were not bound to answer these questions or produce these reports.
My experience tells me that it might be a while before property managers and/or condominium boards become willingly compliant, or knowledgeable, regarding these new conditions. In the meantime, we’ll continue to be the bane of a professional REALTORS® and/or Property Manager’s existence, but bear with me please… our diligence on behalf of a condo buyer provides an educated climate in which a buyer makes a qualified choice and most often, a smooth road to completion of the sale.
And then there was carbon.
I can’t adequately explain the new carbon tax being implemented in 2017, in these few words. I can tell you, however, that if you own a condominium or are considering purchasing a condominium unit, this tax is going to affect that corporation’s budget.
Some larger condominium corporations we’ve spoken to (whose fees include utilities) are anticipating cost increases in large figures. There will undoubtedly be a condo fee increases to support the added cost. Owners/purchasers who are responsible for their own utilities will feel it as well.
Another increase is slated for 2018. The only active way to begin to balance this is to conserve, although there will be considerations given to lower-income residents in the province. We won’t fully know the impact until it’s upon us.
As always, CondoQuest invites you to call or write with condo questions. Confidence truly is in the details when it comes to disclosure documentation and although I’ll never be the most popular girl at the dance, I’ll take your first steps with you.