Thursday, June 1, 2017 / by Amy Francoeur
They say knowledge is power, and this is especially applicable when it comes to buying a condo. Know what you’re getting into, but more than that, understand what you’re getting into, including your strata documents.
In the Times Colonist, Tony Gioventu, executive director of the Condominium Home Owners Association, answers questions people have about their condos. This particular one deals with first-time buyers who thought they were doing the right thing by paying attention to the fact that there was a depreciation report included in the strata documents but are now facing a heavy special levy because the depreciation report left out crucial details.
Of all the strata documents available to you when buying a condo, the Form B and the depreciation report are the two that should start your reading list. The Form B will give you a good overview of how the strata is run and if there are any upcoming motions or items that you should pay attention to or research further. The depreciation report gives you a financial overview of the maintenance of the building as a whole, outlining upgrades, repairs, and replacements with their correlating cost projections and budgets.
Or at least that’s what a good depreciation report should do. In the case of these first-time buyers, what they didn’t realize was that the report was put together by a volunteer, not an engineering company or other suitable, qualified writer.
Gioventu says, “It was the obligation of the strata corporation to ensure the report met the requirements of the Strata Property Act and regulations. If the strata failed to provide you with a reliable report, you may have a valid claim against the strata corporation for the undisclosed liabilities.”
He goes on to say that there are three things he always double-checks when reviewing depreciation reports:
- Who was the writer and what were their qualifications?
- Is the writer insured for the purposes of providing a depreciation report?
- Is there a summary of common property/assets and their projected renewal dates?
Condos are their own niche market, due to the intricacies of the strata documents and how they pertain to your future return on investment. Do you feel confident in your understanding of strata documents? If not, consider talking to a #CondoExpert who is well-versed in Form Bs, depreciation reports, and all other strata documentation. We can help you find that confidence.