Condo plan or proposed condo plan, bylaws, annual general meeting minutes, last 12 months of board minutes, monthly unaudited financial statements, reserve fund study, plan and amount in the fund, management agreement, insurance certificate, percentage of owner occupied units, lease agreements pertaining to parking stalls. These documents and perhaps more depending on the condominium building form the package that all potential condo owners should review and be satisfied with prior to finalizing a conditional offer on a condominium unit. If the list seems a bit daunting (and it should) there is good reason. In addition to purchasing the unit you are also purchasing part ownership in the condominium corporation, a corporation that can have a great impact on your quality of life (ie bylaw restrictions) and your pocket book (potential cash calls).

Any sound, professionally prepared offer to purchase should contain a buyer’s condition that the buyer is given all condominium corporation documentation and upon receipt of all documents have the opportunity to review and be satisfied with them. Where most offers fall short is that the time frame to review these documents is time specific and not tied to when the final document is provided to the buyer.

It’s more often the case than not that sellers do not have on hand all the required documentation to provide to a buyer when an offer is accepted. The scramble begins to locate or order from the management company the required information. If the condition date is a specific calendar date this puts the buyer at a disadvantage in terms of having enough time to review the documents. In the case of new condominiums this situation is resolved by the Alberta Condominium Property Act which states any prospective buyer has 10 days, upon receipt of all documents to review them and be satisfied with them.

As condominium ownership has become a greater segment of the real estate market the awareness of the importance of the condominium corporation documents has increased. This is evident in the number of companies a buyer can hire to review these documents on their behalf. Only seven years ago there were a handful of companies in the city that offered this service. If a buyer thought to have anything reviewed more often that not they consulted with their lawyer. Although lawyers play an integral role in the buying and selling of real estate, their expertise is not in deciphering condo documents. Today buyers have a choice of more than a dozen reputable companies capable of the task.

Given the scope of the financial commitment a buyer is making with condo purchase and that a buyer has to abide by the corporation’s bylaws (can you have a pet, are there age restrictions) the old adage “Assume Nothing” is most appropriate to adhere to. The cost of having documents professionally reviewed will pay dividends in the future!

Are we there yet? On March 28, the city’s Standing Policy Committee voted in favour of a “new” curbside recycling program policy, which is to be voted on by city council on April 16, 2007. This new and improved version will see 300,000 homes (including up to 4-plexes) see weekly pick up of recyclables, including plastics, but excluding food and yard waste. The existing city run recycling depots, totaling nearly 50, located across the city will continue to be operated. This is a great step towards achieving the city’s goal of recycling 80% of the city’s waste material by 2020.

The 2006 city civic census reported a total number of 408,543 residential units. Yet only 300,000 residential units will be served by the new recycling policy, if adopted. More than 25% of the city’s residential units will not have curbside recycling offered to them. It is safe to assume that this number encompasses condominium buildings over 4 units and their residents.

What recycling options are there for condominium dwellers? The city has said the existing recycling depots will remain in place. However, how practical is it for a person who may not have a vehicle to transport their recycling materials to one of these depots, either by foot or on the bus? Other options must be analyzed. Condominium corporations need to look at implementing a recycling program of their own.

As the city has found, there is a monetary cost that accompanies any recycling program. It must be taken into account, however, that an expenditure outlay for a recycling program is accompanied by monetary savings in other areas (not needing to build and maintain another land fill for example). The same is true for condominium buildings. Keep in mind the City of Calgary does not pick up waste from condominiums. This expense is paid for by the owners through their condo fees and can range from a few thousand dollars a year to tens of thousands of dollars for large buildings. By decreasing the amount of “waste” picked up at a decreased cost and allocating those funds for “recyclables” to be picked up would most likely not be any more expensive for the average condo building.

There are already numerous buildings doing exactly this. If yours isn’t, ask the question why. Then put a plan in place to begin. Recycling in condos: Because we can!

Recently I worked with a client looking to purchase a condo in the Beltline area. My client, a lawyer from Ontario, has had significant experience in condo living, serving on the condo board in the building where he lives in Toronto. After viewing many properties, the decision came down to one of two units in two different buildings.

Both buildings were nearly identical in age, number of units, style and size of units and parking (part indoors and part outside). The first building was located in a very desirable area with many amenities such as shops and restaurants steps from the door and offered a strong reserve fund, but had outdated common areas. The second building was in an emerging neighbourhood, with substantial construction of upscale condos and amenities in the works, but currently not as good a location as the first building and it did not have as strong a reserve fund. The suite in the first building was a penthouse and the suite in the second building was not.

While in different buildings, each condo met the client’s needs in terms of size, layout and number of bedrooms and price point. Which one to choose? After much research on my part it may surprise you that the client chose the unit in the second building with the less superior location and smaller reserve fund! Here’s why.

The sale statistics for the building he chose showed a trend of buyers repeatedly paying more for units in this building than in the first building which offered the better location and large reserve fund. It was obvious from first entering the chosen building that the owners and management had invested a lot of time, money and effort into their building. The elevator had been replaced, the lobby updated with new, longer lasting materials in contemporary colours, new window coverings were in the lobby, hallway lighting had been improved, silver hardware replaced the older brass style, there were updated fire exit signs, new parkade lighting installed and the parkade had been painted. In addition, after reviewing the condominium documents it was revealed more improvements where scheduled. It was evident the owners were proud to call this building home by wisely spending money to update and maintain the structure and common areas of their building.

Although the reserve fund was not as strong as the first building, it was clearly demonstrated that the owners in this building were actively involved in maintaining and increasing the collective value of each owner’s investment. The proof of higher value in the second building was demonstrated through sales of $20,000-$40,000 more for the same type of condo as compared to the first building. Through research and analysis my client bought a condo in a superior building which will protect and increase his investment in the future.

When condo buildings were constructed in the 1970’s and 80’s it was very popular for a building to have amenity areas for the owners. These may have included group/party rooms, saunas, hot tubs, exercise areas and change rooms. Over the years many of these have fallen into disuse or disrepair. On average, a small percentage of owners utilize these amenities. The emphasis placed on keeping them maintained and updated is diminished.

There is a financially rewarding option many condominium corporations are currently exploring. More and more are looking to sell these areas, either renovated or not, as individual residential units. There are several factors driving this trend in condo buildings.

The first is obviously the great increase in condominium property value Calgary has experienced over the past several years. Condo boards are eyeing the large sums of money that the corporation could realize from selling the unused or under-utilized common areas in the building as individual units. This money could be used to re-furbish other common areas such as the halls and lobbies or be put to major capital expenditures such as replacing old elevators or roofs, thus alleviating the need for special assessments or higher condo fees. Remaining funds could be allocated to the reserve fund for future use. Updating and upgrading the building would increase the overall property values of units in the building, thereby benefiting all owners.

The second reason for this trend is that these underutilized areas are usually a drain on the collective expenses of the building. They still need to be heated, cleaned and maintained. Boards are looking to turn this expense into an asset.

A third reason is that with another unit in the building paying condo fees, each owners monthly fees may actually decrease.

The process to convert common area to individual ownership is a lengthy one and involves the services of a qualified condominium lawyer as well as the guidance of the management company. A special resolution needs to be passed by 75 % of the ownership (not always an easy number to achieve). The condo plan needs to be resurveyed with new unit factors assigned to each unit. A title needs to be created for the new unit and each title in the building needs to be amended with their new unit factor. This whole process can take over a year and in some cases several years! Given the Calgary real estate market, the financial rewards for the corporation can be great and outweigh the time, effort and expense required.

Currently there are several buildings in the Beltline in various stages of this process. Over time buyers will see more of these situations as they look to purchase resale units, or even one of the former common area suites.

Recently I was showing suites in an upscale, newly constructed condo building in Eau Claire. When I stepped out of the elevator it was like walking into a bright sunny day; the amount of hallway lighting was the most I had ever seen in a condo building. Every 4 feet a wall sconce was on either side of the hall as well as 4 overhead pot lights. You could almost feel the heat coming off the light fixtures. Later I was informed that the condo fee for the suite my clients were interested in had just jumped 30%, due mostly in part to electricity costs! With the amount of lighting in the common areas I saw and the type of light bulbs used this was no surprise.

Here is a classic example of how choosing a greener approach to our lives can actually pay dividends, rather than costing consumers more. The budgeted amount for electricity for this building prior to the condo fee increase was $110,000 for the year. Image if the condo association board for this building chose to change all the common area lighting to compact fluorescent (CF) bulbs. True, there would be an initial cost outlay to purchase new bulbs, at approximately $2 per bulb. However, the CF bulbs have a lifespan of 6,000 hours compared to 750 hours for incandescent bulbs and the energy usage is roughly 25% of incandescent bulbs.

Under this new scenario, the board would be able to reduce condo fees rather than have to increase them! When was the last time that happened? By thinking “green”, the owners of the building could actually save money. The board could go a step further and put in place a building policy that individual unit owners use a minimum number of CF bulbs in their suites as well. In the case of this building, the electricity for the suites is not individually metered and the condo association pays for everyone’s electricity. This small change would be a cost savings for the owners year after year.

The promise of saving a few bucks a year by using 1 CF bulb may not send you rushing out to replace your bulbs. But consider the wider impact when this is applied on a broad scale, as in a condo building. The green benefits suddenly become very tangible, especially to your pocketbook!

There are hundreds of condominium buildings in Calgary. Each one is unique in its own way. Some have very distinguishing features such as a great architectural design, a swimming pool, running track, or maybe retail shops in the buildings. But can you name something that less than 10 condominium buildings in Calgary possess? The answer is a building concierge. This person is, by definition according to Webster’s dictionary, a caretaker or doorkeeper. In today’s age of busy lifestyles a concierge is so much more to the people who are lucky enough to reside in a building featuring a concierge service.

“Knowing that Arnold and Elaine, our building’s concierge’s, are on the job to ensure my guests are warmly greeted and know where to find my condo gives me great peace of mind. Not to mention the added sense of security I have because everyone who enters the building is received at the front desk” says Chateau La Caille resident Carol Bennet.

For Don Skelton of 500 Eau Claire, having a concierge in the building meant he could renovate his condo without taking on a scheduling nightmare. “When we moved into the building we had no idea of the value that having a concierge would bring. We spent months having work done on our condo, and if we had to let each tradesperson into the unit day after day, I would have had to quit my job. With our concierge there to let each tradesperson into the unit, our renovation went much smoother than expected. We couldn’t have done it without their service.”

Service is what the job of concierge is all about. For the owners and residents in the building, service can mean different things to each one. A smiling face to greet you after a gruelling day at the office, co-ordinating tradespeople for your renovation, facilitating fire equipment testing, disseminating condominium corporation information to all owners, having someone to accept your drycleaning when it is dropped off are a few of the many responsibilities and services a concierge has to offer. Most importantly, the concierge is the face of your building’s community that the rest of the city sees on a daily basis. The concierge is also a reflection of those who reside in the building.

With so few buildings in Calgary offering this dynamic service it is not surprising that these buildings are so desirable for people looking to buy condominiums. And this demand seems to be increasing. Of the few buildings offering concierge service, all but two have been built in the past seven years. Currently, there are 2 new concierge buildings under construction in the Eau Claire area alone and a third in Connaught. Maybe you see a need in your life for the services a concierge has to offer! Find out which concierge will meet your service needs.

If you own a condo you pay condo fees. It’s a necessary part of condominium life, given that common property expenses, management and reserve fund contributions need to be jointly paid by all owners. But not many of us are fully acquainted with some of the nuances behind the fee.

Most owners assume that the condo fee amount they pay is based on the unit factor of their unit and that is based on the size of their suite compared to all the others in the building. The larger your suite, the larger your unit factor. But this is not always the case. In fact, there is no regulated standard for how unit factors are determined. They can be up to the discretion of the developer. This leaves the door open for a developer to assign unit factors based on the approximate market value of each unit. This could mean that the higher a unit is in a building, not only does the price go up but the associated condo fee would also go up compared to a similar sized unit lower in the building. Or in the case of a townhouse complex the developer could give each unit the same unit factor irregardless of the size of each unit. Each unit would then pay exactly the same condo fee as each of their neighbours. This is quite customary in bare land condos.

Of course the fee you pay is based on your proportional share of the annual budgeted amount for the building. If you don’t like the fee you are paying, there isn’t much you can do about reducing the number of unit factors you have. The only variable to manipulate is the budgeted amount. I have seen many condominium boards take an aggressive stance when it comes to the budget. Many cost saving measures can be implemented if a board is savvy. Look for opportunities to reduce energy costs, renegotiate contracts for management, janitorial or landscaping positions, look at fixed contracts for utilities, all which could lower the total budgeted amount for the building. If you have some ideas on how your building can save money why not volunteer for the board? Condominium boards are always looking for enthusiastic, solution oriented owners.

And remember that condo fees are not optional! In the rare instance where an owner does not pay their fee over a period of time, the board has the power to caveat an owner’s property for the outstanding amount. In the event the property is sold, the outstanding balance is the first item to be paid from the proceeds of the sale, before any outstanding property taxes or mortgages! Condo fees carry a lot of responsibility and clout. They ensure your condominium communities ongoing financial feasibility and look after you and your neighbour’s mutual investment.

Spring is a busy season for most of us. We shed off the short days and long nights of winter and embrace the longer daylight hours that accompany spring. With these extra hours of daylight we fill up the time quickly. The road construction season is in full swing and home and garden centres have people lined up at the checkouts! It seems we all realize there is work to be done after the long winter months.

Your condo building is no different. Maintenance and other jobs that have been waiting to get done since the fall now press for attention. Also, spring is a prime time for condo corporations to have their annual general meetings held. As a condo owner, spring is a busy season for you, too!

Maintenance work that needs to be completed can affect you, individually. Several, standard, annual items may include parkade cleaning (do you need to be home to move your vehicle), window cleaning (maybe keep those blinds closed), and exterior building maintenance (some building exits may be inaccessible). It is important to be aware of what is happening around your building and when so as not to experience any unnecessary surprises. Most management companies do an excellent job of keeping owners informed of spring maintenance activities happening around your building.

There may be a need for the management company to have access to your unit for some maintenance items. These could include fire protection equipment check-ups, heating system maintenance, window replacement or other items. It is important that the management company have key to access the unit if you are not going be there. Most of these activities will occur during business hours so leaving a key with the building manager will help expedite the work to be completed.

If spring is when your building holds its annual general meeting, plan to make room in your busy schedule to take part. AGM’s are a great opportunity to meet your neighbours, the building manager and hopefully offer you an opportunity to get more involved in your condo community. Consider volunteering for the board or one of the committees, perhaps the landscaping committee! If you have green thumb and feel it is not getting enough use living in a condo, why not flex that thumb muscle for the benefit of the whole building. Your neighbours will love you for it and you will be enhancing your investment at the same time.

Springtime in your condo building can be a very busy and rewarding season. Why not make the most of it!

It has been yet another wet and rainy June in Calgary. We have all been impacted by the amount of water Mother Nature has thrown our way this past month. For Southern Alberta, too much water is not a typical problem. Our semi-arid climate can leave us prone to droughts as we experience several years ago. Finding ways to preserve the ground water and implementing methods to minimize water usage in the province is a hot topic. The City of Calgary is proactive in encouraging water users to reduce consumption.

A huge water waster is hiding in every residence. The average toilet can waste thousands of litres of water a year. With water and sewer costs metered in condo buildings, this can cost you and your condo corporation thousands of dollars a year as well. Toilets account for an average of 30% of the total water usage for a residence. Conventional models can consume up to 18 litres per flush, as compared to 6 litres for the new low flush models. That’s over 66% savings in water and cost per flush!

The City of Calgary offers a $50 rebate for every conventional toilet replaced with a low flush model. Some modes cost as little as $150 and each will save you up to $100 in water cost the first year alone. Each year thereafter you are saving not only water but money, too. Dual flush models will save you even more money and water, and are included in the rebate. For more information call 311 or visit www.calgary.ca/waterservices.

Although this is an excellent way for individuals to do their part, imagine if an entire condominium building embraced the rebate program. As most condo buildings have only one water meter, the corporation pays the water and sewer cost from the condo fees collected. A large building can have water and sewer annual bills of $45,000. If 30% of that water usage is from toilets ($13,500) and installing low flush toilets in the building would save 66%, the corporation could reduce it’s budget by nearly $9000 a year and collect the $50 rebate per conventional toilet replaced.

This is another example of an idea making green sense, and dollars and cents, too!

Maybe you have heard of the residential rental crunch the city of Calgary is experiencing this year. According to Canada Mortgage and Housing Corporation, Calgary’s vacancy rate is below 0.5%. The situation has been so extreme the U of C’s student union put out a call for Calgarian’s to consider housing a student for the year, due to the remarkably low number of affordable suites available for students to rent. Obviously there is a need for more rental suites in the city and not just the “affordable housing” that is in the headlines.

Combine this with the large supply of properties currently for sale in the city and the savvy investor will see an opportunity in the market. In the inner city alone there are nearly 200 condos for sale under $300,000, many of which would make excellent investments as rental units. Finding a tenant is not a problem in today’s tight rental market and there are solid investments to be found with the abundance of properties to buy.

Given the real estate environment in the city you may be looking to expand your investment portfolio into real estate. Of course the question becomes where to start. Begin with a call to your banker or mortgage broker. You may also want to speak to your tax accountant to explore how owning a rental property will affect your tax position.

Once you know what price point to focus on, start looking at properties. But why look to condos and not single family houses? Several reasons jump to mind: less property to manage and maintain (ie roofs, fences, furnaces, etc), the initial investment is lower due to the lower price point compared to single family homes and typically there is less wear and tear on the suite based on renter demographics. Proportionally, the rent received per dollar invested can be greater in inner city condos compared to single family homes.

If the condo rental market looks good to you, find a realtor who specializes in the condo market segment to guide you through the purchase process. You may also want to explore the option of having a management company look after the property, find tenants, collect rent, etc. Consider the option of renting the property fully furnished, which will bring in much larger rental income. Find out what different types of properties are renting for; a one bedroom suite verses two, with parking and without, one community compared to another, etc. In addition to looking in the classifieds section of the local paper for this information there are several online classified rental sites for the Calgary area that are excellent, including pictures and greater detail than the paper offers. In addition, once it is time to find your future tenant you can utilize these sites at a very reasonable rate.

It is important you familiarize yourself with the laws pertaining to landlords and tenants in Alberta. Check out www.servicealberta.gov.ab.ca as well as www.landlordandtenant.org for more information. Good luck with your income property!

Imagine flying over the downtown core and below you is a checkerboard of green gardens and oasis’. Sound improbable in our highly populated inner city? Calgary has a surprising amount of wasted open space. In the densely packed downtown core including the areas of Eau Claire, West Downtown and the Beltline, prime real estate space atop roof tops is given too little consideration in a city that values each square foot so highly. These unused spaces can offer extensive benefits to city dwellers, developers and concerned citizens alike when retro-fitted as “green roofs”.

A green roof consists of a waterproof, root-repellent membrane, drainage system, filter cloth, lightweight growing medium and vegetation ranging from grasses and plants to trees. A few of the benefits green roofs offer include:

• Providing much needed amenity space for building users
• Increasing the roof life span
• Reducing storm water run off
• Providing noise insulation
• Filtering pollutants and CO2 out of the air
• Providing locally grown food (from roof-top vegetable gardens)
• Increasing habitat for birds in built-up areas
• Reducing heating (by adding mass and thermal resistance value) and cooling (by evaporative cooling) loads on a building
• Reducing the urban heat island effect

For the vast majority of people, emerging technologies and new ways of thinking need to make economic sense in order to be embraced. True, the construction of a “green roof” can be as much as twice the cost of a conventional roof, even though the public and private benefits are numerous. Successful “Green Roof” initiatives in Toronto, Chicago, Portland, Minneapolis and New York have implemented incentives for developers to incorporate at least 75% coverage of new building roofs as “green” in exchange for increased zoning density. Other initiatives could include tax incentives to retrofit existing buildings to “green roofs”.

Could this type of policy driven change be adopted in Calgary? Calgarian’s are quick to apply the spirit of “because we can” to a situation to improve it for the better. Our cities high rates of volunteerism is a great example of the “Because We Can” spirit so prevalent here. Why should our city’s stakeholders look to green the rooftops of Calgary? Simple answer:

“Because We Can!”

Condo living means many things for many people. Simplified maintenance, more personal time, ease of part-time residency, co-operative management of shared common property, increased safety, affordability and many more, as varied as the people who own and live in condos. One important aspect of condo living that will be gaining greater attention is the positive impact condominium buildings, condo owners and condo corporations can have on our environment.

The impact of global warming on our environment is in the news daily and it is impossible to avoid or dispute that it negatively affects each and every one of us. Every Canadian is responsible for contributing an average of 23 tonnes of green house gases into the atmosphere every year! To help combat this, the Federal government has recently announced several initiatives for home (condo) owners to help reduce green house emissions by “greening” their homes through reducing the amount of energy consumed. Although firm details will be announced later in the spring, the government is proposing a $5000 rebate to home owners to cover the costs of increasing their homes energy efficiency. Presumably this could go towards the purchase of a high efficiency furnace, increasing the insulation in the home, installing more energy efficient windows and other similar “green” upgrades. But how can condo owners take part in this and make a difference?

Condo living already means owners work as a collective to focus on the needs and goals of all owners. It is an easy step to direct the same collective energy to find ways to reduce the carbon footprint of a condo building. If individual condo owners pool their $5000 rebates and put those funds to greening the building as a whole, the financial impact on individual owners would be quite minimal. Initiatives could include the installation of motion sensor lighting in hallways and/or parkades that only come on when someone is present, replacing old windows with double or triple pane windows, changing incandescent light bulbs to lower energy consumption florescent bulbs and reducing the temperature of the parkade. All are substantial steps a building and condo owners can collectively take to address the issue of reducing carbon emissions. As if saving the planet were not enough reward, there is the potential for condo fees to decrease when less energy is used in the building!

Enmax and Direct Energy, two of the leading energy suppliers in Calgary, already have programs in place to help condominium buildings analyze and reduce the amount of energy consumed. I encourage each and every condo board in the city to take on the challenge of reducing the amount of energy used for their building.

Here is your Morning News Rundown for Friday, Nov. 21:

CMHC probing Canadian house ‘premium’ to U.S. prices – CBC

Condos make up more than half of housing starts in Canada’s biggest cities: CMHC – Financial Post

Calgary gets high for quality of life in Citizen Satisfaction Survey – CBC Calgary

Morning News Rundown is a post from: CREBNow… Read More

Morning News Rundown is a post from: CREBNow