I am often told by buyers that they are frustrated with the purchase process of condominiums in Edmonton, Alberta. You see in Edmonton, a client is generally not granted the opportunity to review condominium documents before the buyers write an offer on the property.
The contracts used for MLS® purchases (not most Builders) is created by the lawyers over at the Alberta Real Estate Association and included in a Residential Condominium Property purchase contract is a condition of satisfaction with the condo documents. This is great; as a consumer, you need to know how well the property is being managed and how much money it has in the bank.
You will most likely be waiting for a few days after you negotiated with the Sellers and reached final acceptance before you receive the condo documents. The Sellers will have to request a copy of the documents from the property management group and they will take some time to produce the results. Even a rush job can lead onto to a week or more, especially in straightening out everything that is needed for the buyer to make an informed decision. A part of the reason that the Sellers aren’t asked to provide the documents before the offer comes in, is the cost. To get all the documents necessary, it could cost the Sellers up to 600 dollars and that may not even include a rush service. Another reason is tied to the information statement which needs to be current to the month that you have written your offer; and that makes it nearly impossible to do ahead of time. (See Sellers Note 1 at the bottom of this post.)
So how do you make an informed decision quickly?
Real Estate is a quick industry and the best homes at the best prices always go right away. So how do you beat the rest of the public to a smart decision about that particular property and move onto the next one, while maximizing your time spent looking?
Simply put; look at the amount of the condo fees.
All Condo are not created equally, you could have a 1000 ft2, 2014 built, apartment styled condominium with condo fees of $175 per month no utilities included. You could also have a 1000ft2, 1976 built, apartment styled condominium with condo fees of more than $1,100 per month condo fees. What makes the difference in the fees is if; utilities are included, what kind of building it is, how much maintenance costs for that building and the historical as well as professional management of the property.
If those condo fees are high, you can bet they have had to raise the fees to offset future repair and replacement costs. Sometimes the condo fees get so high they are just as much as your mortgage. If the condo fees get that high, you will need to be earning a fairly good wage as condo fees are considered a part of debt to the Financer and you will need to be able to cover this cost, plus your mortgage and still have a significant portion of your wages left over for things other than housing.
What is considered High Condo Fees?
Yikes, this is a tough question. Like I noted earlier, it depends on what is included in your condo fees. I’m going to talk generals or averages here. 1000 ft2 apartment style – low rise, 2000+ build, with heat, water and power included – maybe $550 per month. Same type of property, no utilities included; maybe $250. 1000 ft2 apartment style – high rise, 1970+ build, with heat, water and power included – maybe $900+ per month. Your 2 storey townhouse condos also known as row housing; probably won’t have utilities included and those condo fees fall in ‘normal’ ranges of $200-$275. You should know though, that these averages do not include Bare Land Condos. This is a different type of condominium structure and less exterior maintenance is paid for by the corporation. It is a type of condominium where you own the land the property is on; not just have exclusive use of it.
So check out those condo fees and use your smarts or your REALTORS® help for knowing if it is even going to look at in the first place. Save yourself time, money and frustration. Not every condo is a welcome choice.
If you are thinking about buying a condo and would like a valuable, subject matter expert on your side; I hope you will give me a call. I’d like the opportunity to help you make an informed decision for your home purchase in Edmonton. I consider this as one of the ways in …
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SELLERS NOTE 1: If you are a Seller, I suggest leaving the Information and financial statements to when you have a negotiated offer in place and ordering the by-laws, property management agreement, full reserve fund study, reserve fund plan, reserve fund study, annual general meeting minutes and the budget when you list your home for sale.