Your Guide to Condominium Corporations in Calgary
- September 10, 2022
- By Cody Battershill
Your Complete Guide to Condo Corporations
Most condo buyers aren’t interested in condominium corporations not because they don’t care, but because they don’t know what it is or why it is important.
As highly experienced multi-family real estate agents, let us tell you why condo corps – and choosing the right one – are critical to understand when buying a condominium. Also see:
- Guide to Condo Corporation Financials
- Search Calgary Condos for Sale
- 20 Tips for Buying a Condo in Calgary
What is a condominium corporation?
A condominium corporation is the legal entity or “board” that governs and represents an apartment complex. Hence, when you buy a unit at, let’s say a building called Montana, for example, you become a partner in its condo corporation.
Every homeowner is a shareholder of a building’s condo corp. And, as owners, you are expected to come together and make decisions about the building. Maintenance costs and other fees associated with upkeep are also shared by members.
A condo corporation can sue someone or a company for damages to common property in the building. It can also be sued by another person, company or other legal entity on any matter for which the owners are reliable. In regard to such matters, an agent or employee - such as a lawyer - can act on behalf of the condominium corporation.
Why get involved with your condo corp?
There are several important reasons you should get involved in your condo corporation by joining the board of directors or at least staying informed by attending every meeting.
As mentioned above, when you buy a condo in Calgary you not only acquire the physical space, but also an ownership interest in the corporation that owns and manages the common property and overall structure. With ownership comes intrinsic value that must be maintained if your investment is to stay safe.
Since the condo corporation’s actions can directly impact the value of your unit, it is essential to get involved and be a part of the decision-making process. A few important considerations:
#1 - Resale value
Your Calgary condo’s value is directly tied to the health of the condo corporation. Get involved, contribute and improve the building for everyone's betterment.
You may have experience in certain areas that other board members may not; combining knowledge and expertise gives your building – and its units therein – the best chance to retain its value on the local real estate market.
#2 - Maintaining your investment
Again, this goes back to your resale value but can also impact your quality of life while living in the condo.
Perhaps as a new owner, you have different ideas, solutions or suggestions that will contribute to keeping condo fees lower. Or, maybe you can develop new solutions to old unsolved problems.
Don’t be afraid to participate and share your ideas. As collective owners, it is in the best interests of everyone to ensure the building fosters an easygoing and relatively peaceful living ambiance.
#3 – Staying up-to-date
Condo buildings can be massive, especially when living in medium to high-rise projects in the downtown areas. Therefore, by getting involved in the day-to-day decision-making process, you’ll know exactly what is going on in the building, and why.
You will never wonder why someone else made a decision on your behalf that affects you greatly, because you’ll be making those decisions for yourself as part of the condo board or active member in meetings.
What is a “board of directors?”
Like a large company, the board of directors oversees a condo corporation’s needs. Typically made up of a small group of elected (and volunteer) unit owners, there is often a sub-committee structure where certain individuals are responsible for certain tasks such as landscaping or organizing activities and events.
Any condo owner can run for a spot on the board of directors, which is great news if you’re looking to take your involvement with the condo corporation a step further.
Why do you need a property manager?
Property managers are an essential part of any apartment building. Offering professional management services, some of the responsibilities of a property manager include:
- Making recommendations to the board of directors
- Maintaining and managing the condo’s common areas
- Overseeing security and other activities/events
Not to worry, as decisions on capital expenditure and others of the sort are always made by the condo corporation – not the property manager (often a third-party consultant or company).
What are condo "bylaws?"
Bylaws regulate the condo corporation and provide directions for administration, management and control of the building's units and common property. They also distinguish the differences between common property and personal property, and what owners can or cannot do with each.
Every condo board is different and may have bylaws that are quite unlike that of other condo boards. Here are a few examples:
Example #1 - one high-rise condominium in downtown Calgary might allow up to two dogs as long as they are registered with the condo board, while another beside it may not allow pets at all.
Example #2 – the same two buildings may differ in how you are to go about renovations on the interior of your unit. One building may require approval from the condo board while the other may not.
Knowing the bylaws for your current or prospective building will give you an idea of what your rights and responsibilities are. Also see:
Health of a Condo Corporation
When buying a condo you’re not only buying the living space itself, but also a share of ownership in the condominium corporation.
When all is well, your building will function and run smoothly and be maintained and managed properly. When the building is however not managed properly, it can make your unit extremely hard to re-sell.
Most banks won’t make loans on buildings that don’t have an adequate reserve fund and diligent management as their loan is not properly collaborated in the security of the property. This is why a professional review of condo documents is essential before making a purchase - to determine the health of a condo corporation.
Other side effects of an unhealthy or under-capitalized condominium corporation can include the potential for special assessments where a bill is paid by each unit owner for their proportionate share of the condominium's cash shortfall needed for repairs.
When a special assessment is necessary, condo owners can face incredibly expensive bills – sometimes in the tens of thousands of dollars – to pay for repairs. Can you imagine getting a bill for $70,000, for example, and having no choice but to pay it or go into foreclosure?!
Do your due diligence by hiring an experienced condo real estate agent and ask them to arrange a full condo document review on your behalf!
Alberta Condo Laws
Condo corporations are just one element of owning a condominium in Alberta. In fact, our province has several condo laws that must be obeyed by all corporations.
Alberta’s Condominium Property Act outlines the responsibilities and prohibitions of the condo corporation. This Act requires condo corporations to:
- manage, maintain, and repair common property
- hold insurance
- maintain a reserve fund
- present an annual budget
- collect fees
- maintain documents and records
- enforce the corporation’s bylaws and rules
Basically, the Condominium Property Act and Condominium Property Regulations provide for condo corporations to establish bylaws and rules specific to that corporation’s operations.
Make the Best Decisions
Another integral part of safeguarding your decision is working with an experienced Certified Condominium Specialist (CCS®) and REALTOR®, one who knows the condo market intimately and the ins and outs of buying and selling condo properties.
Be sure to check out our Complete Resale Calgary Condo Guide for several more tips and tricks to buying a condominium in Calgary.
Questions about Condos in Calgary?
Contact our team of experienced condo real estate agents anytime at 403-519-0495 or by visiting our contact page today. We are looking forward to helping you accomplish your condo goals!