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Understanding the Condominium


Understanding Condos

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Condominiums, more affectionately knows as condos, are privately owned units within a larger building where responsibility and cost of the upkeep, maintenance, and operating costs of the building is shared among the condo owners. That means pools, lobbies, recreational areas, gyms, hallways, parking lots, security, concierge, building insurance, management salary, and other amenities are paid through a set monthly fee by each unit owner. Additions like personal cable or hydro are generally not included within the fee but can be acquired by each owner for an additional cost.

Condo dwellings vary in type, size, and shape, and are usually categorized using the following:

THE CONDO APARTMENT
The condo apartment styles are generally a suite, two-story, or loft styles with sizes varying from a small, one or two room unit, to huge luxurious units with loads of space, including patios and balconies, and the highest quality materials like granite or marble. Residents have ownership of their unit and pay monthly maintenance fees for the building’s care.

THE CONDO TOWNHOUSE
Each individual unit of a condo townhouse is owned just like a condo apartment. Monthly fees are paid for exterior maintenance and the area outside is shared with other townhouse residents. However, unlike a condo apartment that offers in-house amenities like concierge services, the townhouse amenities might offer a park or playground instead.

THE CO-OP
In a co-op, a share-owned corporation leases a townhouse or an apartment unit to a buyer, and co-ops usually require a 30% to 50% down payment. Due to the comparative investment return in the long run, popularity is not as strong as with other condo ownership.

Amenities, Maintenance, and More

Maintenance fees are confusing to some, but they don’t need to be. Maintenance fees are determined by the budget of the building. The board is charged with producing this budget annually, which covers all of the expenses of the building. Once there is a gross budget number, it is divided and split into the percentages that each owner has of the building. The percentage each owner has is based on a declaration that was developed around the time the condo was built, and when a survey was done to determine exactly how much percentage each unit of the building occupies. This fee is then collected montly.

Maintenance fees pay for a myriad of amenities and services which include things like recreation rooms, Jacuzzis and saunas, pools, gyms, party and media rooms, and common areas like rooftops and lobbies. These fees also pay the payroll of security guards, managers, concierges, and staff for cleaning and maintaining elevators, windows, garages, landscaping, and other required maintenance.

These fees may appear to be an unnecessary expenditure when compared to independently buying a home outright. Most just don’t think about the expense associated with the upkeep of a home. Equipment and tools like lawnmowers and snow blowers can be expensive. Then too, there’s the responsibility and time that goes with having to maintain it yourself as opposed to having it done for you.

By living in a condo, you’ll have the assurance your property will be well taken care of and that your investment will be protected. One of the best advantages is that it will also free up your time and release you from the responsibility of getting it done yourself.

How Condos Function

Buyers of pre-built and new condominiums are exposed to a distinctive two-step process when closing. Generally, this is because the new condos are ready for occupancy before the owners can be presented with the title. These two steps accommodate the closing dates which usually happens after the legal registration.

The “interim closing” is the first stage and comes about either on, or around the occupancy readiness date. It’s on this date that the buyer pays the owing balance on the contract of purchase which is then put into a trust until the legal title is given to the buyer on the ‘final closing’ date.

During the time between the final closing and the interim closing, the buyer is required to conform to the Agreement of Purchase and Sale in it’s entirety; things such as abiding by all the condo’s regulations and rules, and by paying the monthly fees of occupancy. Once the condo corporation is registered, the final closing takes place. It’s at this time that the deposit is released from the trust account and the new buyer is required to pay the purchase price balance. Once completed, the developer presents the new buyer with the deed for the condo unit.

Maintenance

Once the building is completed, the builder will generally warranty the final finishes for a stated period of time. Responsibility of repairs and deficiencies also goes to the builder who will work with the property manager and board to complete any necessary work. The responsibility for repairs and maintenance shifts to the condo corporation and the residents once the warranty dates have been passed, and the costs are taken from the yearly maintenance fees from that date forward.

REPAIRS
When repairs are needed, the condo board and property manager review work bids from possible service providers. Generally, the choice is made based on quality of work, not necessarily estimate alone, and the cost is then taken from the annual maintenance budget.

INSURANCE
Almost all condo corporations do have an insurance policy to cover the overall building, but each unit owner needs to buy their own homeowner’s insurance. Those who live in condos will find their homeowner’s policy to be a bit different from general home insurance in that their insurance won’t cover an entire building, but rather their own private property instead. Speak with the property manager to learn just exactly what is covered under the complete building policy. Then seek insurance that will cover your personal property from theft, explosion, smoke, fire, storm, and anything else you deem necessary. Things like balconies and improvements are also usually covered with this type of policy.

When buying condo insurance, choose a reputable agency and gain a good understanding of what your policy will cover. Then keep your original policy in a safe place, such as a safe deposit box, but have a copy in your condo if you should need to refer to it.

Board of Directors

Each condo will have a Board of Directors, and they are called to act with the requests and interests of the condo owners in mind. A board member cannot serve for more than three years, and new members are elected on a rotating basis that is staggered between three-, two- and one-year terms, this way the board always reflects a range of experience. Board members are elected by residents at the annual general meeting.

Functioning within, and being an integral part of that condo community is the role of the property manager. Board members normally come from within the condo community of the corporation. They want to meet people and live as neighbours, but that can sometimes be difficult if they’re always telling people what to do and having to become the police of the community. So instead, a property manager is hired to communicate and enforce the board decisions. The manager becomes the face of the board, and takes decisions of the board and works with and communicates them.

Last, but not least, a condo is a corporation. When the building was constructed and registered, it became a legal entity referred to as a corporation. This legal entity consists of rules and by-laws, and is registered as a corporation and given a corporation number. Members, positions, responsibilities, property management and such are outlined within the corporation.

Condo Trends

Condo dwellers should always keep resale value in mind. Most who live in condos don’t expect to stay there for the rest of their lives, so any changes made should reflect that idea. When redecorating, it’s vital to be on the cutting edge of style, so stay away from outlandish paint colors and trendy furnishings that won’t stand the test of time. Modernize with stylish furniture pieces, higher quality materials, and inviting colors so as to appeal to a larger range of people instead of just those who share the same style. Let upgrades increase the condo value by using higher quality products instead of just those that are more expensive.

What’s Hot?

Clutter-Free Living
Living free of clutter is a must for those who live in a condo since storage space is quite limited. Most condos do provide a storage locker and one or more closets, but compared to other types of homes there are very few places to store things, especially larger items. Condos are much more appealing and easier to live in when they’re not loaded with unnecessary items. So, when an owner isn’t sure where to put something, its best not to buy it; or if it’s already owned, it’s a good idea to throw it out, give it to a friend or charity, or sell it to make for a much more relaxed and comfortable experience.

Flowing D├ęcor
When decorating, it’s much more cost effective to choose one theme and carry it throughout the condo. For example, give the appearance of having a suite by painting the bedroom and bathroom using the same color, and choose coordinated accents. Condos and townhouses are usually smaller in size but often have an open-concept design. Therefore, using a theme color throughout the rooms, with varying lighter and darker tones of that same color, unifies the space and causes it to appear larger.

Dramatic Wood Finishes
Varying types of wood can be used to bring drama and accent to a condo’s decorating scheme instead of dark paint colors which can make it appear smaller. Use oak or cherry wood finishes on floors or cupboards, and accent with a dark piece or set of furniture. Against lighter toned walls, it will bring depth and give a high-end decorator’s touch to the interior design.

Streamlined Storage
In a condo, every square foot needs to count when it comes to storage. Add shelves or organizers to closets, hang racks on the inside of doors, install easy glide drawers and lazy-susans to better facilitate the hidden spaces in the back, and put thin plastic bins on wheels to roll under beds. Then too, by using seasonal bags to store seasonal clothing will make the best use of the space available.

What’s Not?

Gaudy Paint Colors
Bright purple might be a personal favourite when it comes to clothing, but it could be the worst paint colour choice when decorating a condo. Rather than use it as a main color, save it for the accents and use more neutral tones for the walls. Accessorizing a condo with vases, flowers, candles, blankets, and pillows will give it a more personal touch and still keep it stylish and easily adaptable when necessary.

Fading Floors
Keeping floors in top condition doesn’t need to include expensive renovations. True hardwood floors should be cleaned and waxed regularly while laminate floors shouldn’t be washed at all. Bubbling can be caused when the liquid leaks through the pores so regular sweeping and spot cleaning are advised. If selling a condo is in the future, having the floors sanded and refinished could bring an excellent return on the investment.

Too Much Bulk
If the intent to move from a condo is in the future, choosing appropriate furniture now can save big bucks later. Over-stuffed chairs and bulky furniture will most definitely take up space in a smaller condo that could be put to better use elsewhere. Then too, moving more streamlined furniture is much easier when going through doorways or taking elevators or stairs. Easy transition will be greatly appreciated when that time comes, and it will save a great deal of money in the long run.