A condo purchase includes more than the unit
When you buy a condo, you are not only purchasing the space inside the unit. You are also becoming financially connected to the building, its common areas and the decisions made by its syndicate of co-owners.
A condo may appear attractive and have reasonable monthly fees, but its documents can reveal upcoming repairs, insufficient savings, insurance concerns or disagreements within the building. This is why I encourage my buyers to obtain and review the documents as early as possible.
The principal documents to review
1. Declaration of co-ownership and building regulations
These documents establish the owners’ rights and responsibilities. They may contain rules concerning pets, rentals, renovations, parking, storage and common areas. Buyers should confirm that the rules are compatible with how they intend to use the property.
2. Financial statements and annual budgets
Financial statements help show whether the syndicate is operating responsibly. Look for recurring deficits, unpaid condo fees, unusual expenses and whether the building appears to have enough money for its regular obligations. A low condo fee is not automatically an advantage; it may indicate that too little has been set aside for future maintenance.
3. Contingency fund information and study
The contingency fund helps finance major repairs and replacements involving the common portions. Its balance must be considered alongside the building’s age, condition and anticipated work. A seemingly large fund may still be inadequate if the roof, windows, masonry, elevators or garage require major work.
Quebec’s newer co-ownership rules require syndicates to obtain a professional contingency-fund study and maintenance log, subject to the applicable transition period. The study estimates major work and recommends how much should be contributed to the fund.
4. Minutes of co-owner and board meetings
Meeting minutes can reveal issues that are not obvious during a visit. I look for recurring discussions about water infiltration, structural problems, insurance claims, owner disputes, deferred maintenance and major work. A concern mentioned repeatedly without a clear resolution deserves closer attention.
5. Special assessments and planned work
Determine whether a special assessment has been approved, is being discussed or may become necessary. Responsibility for an assessment connected with a sale should be addressed clearly in the transaction rather than assumed.
6. Insurance and water-damage history
Review the building’s insurance coverage, deductibles, claims and self-insurance fund. A history of water damage or a high deductible does not automatically mean the condo should be avoided, but its cause, repairs and preventive measures should be understood.
7. Maintenance log and inspection reports
The maintenance log records the building’s principal components and anticipated maintenance or replacement work. Engineering reports may provide further information about the roof, foundation, balconies, garage, exterior walls or mechanical systems.
8. Certificate from the syndicate
Under Quebec’s current rules, the syndicate’s certificate provides important information about the condition and finances of the co-ownership, including its funds, recent financial results, insurance, losses, major work, legal disputes and certain changes to the declaration.
What warning signs should buyers watch for?
- An inadequately funded contingency fund
- A planned or possible special assessment
- Condo fees that are likely to increase significantly
- Repeated water infiltration or insurance claims
- Important issues in meeting minutes without resolution
- Missing, incomplete or outdated records
- Major work that has repeatedly been postponed
One warning sign does not necessarily mean a buyer should walk away. It means the issue should be investigated, its financial consequences estimated and the buyer’s comfort level considered.
My advice to West Island condo buyers
Obtain the documents early and evaluate them together. A low contingency-fund balance becomes more meaningful when meeting minutes also discuss an aging roof. Increasing insurance costs become more concerning when the building has experienced repeated water damage.
Professional guidance can help buyers identify these connections, ask the right follow-up questions and reduce the likelihood of unpleasant financial surprises after the purchase.