Deb & Perry Abbey : Home - leaky condos, vancouver real estate, special assessments, rain screened, contingency reserve funds

By: Abbey Partners  09-12-2011
Keywords: Home inspector, Leaky Condo Crisis

Real estate: Before buying condo, check condo maintenance records

Verify amount of contingency fund and money for emergencies

BY DEB ABBEY, VANCOUVER COURIER

OCTOBER 14, 2011

Leaky condos aren't the only challenge facing buyers.

Another issue that affects all condominium developments is maintenance. If a condo was built prior to the 1980s, its condition today will be a factor of the strata council's long-term maintenance record and future maintenance plans. The same is true of rainscreened condos and condos built in the past few years where warranty reviews and maintenance will have a critical impact on retention of property values.

Older buildings are very appealing. They often have larger suites with bigger rooms that fit real furniture and they're usually less expensive on a per-square-foot basis. But developments that were built prior to the leaky condo crisis have issues of their own that you'll have to consider. These buildings are at least 25 years old and even if they've been well maintained, there may be worn-out roofs, window systems, water piping and boilers that have to be replaced.

These are routine maintenance issues in older buildings, but if they haven't been replaced, you'll want to know whether there is enough money in the contingency reserve fund to pay for them and some left over for emergency repairs. If there isn't enough in the reserve, there will be a future assessment. This isn't a deal killer-you just have to know how much it will cost and factor that into your purchasing decision. Most home inspectors will be able to give you a ballpark figure for your share of the cost.

The building envelope, while likely not as problematic as the leaky condos of the '80s and '90s, may have maintenance issues. If the flashings and caulking on roofs, windows, decks and so on have not been maintained, water ingress and the ensuing mould and rot may still be a problem, so make sure that you have your home inspector look carefully at the condition of the common property. If that raises any red flags, consider having an engineer inspect the property as well.

It's difficult to cover up decades of poor maintenance, so take a careful look around yourself. You'll soon recognize the difference between a well-managed and maintained development and one that's been neglected. Ask to see the long-term maintenance plan. If there isn't one, that's a concern.

Moving on to the leaky condo era. Many of the buildings from the '80s and '90s have now been rainscreened, making them like new at that time, if it was done properly. There should have been an engineering or building envelope report done to assess the condition and the scope of the work needed before they were rainscreened and a completion certificate when the work was finished.

Unfortunately, some leaky condos have been under the tarp two or three times because the rainscreening was botched by a shady building contractor. Read these reports carefully and have your building inspector or other expert explain anything that you don't understand.

Check out the warranty (more on that later). If the rainscreening was done some time ago, your due diligence should focus on the quality of the job as well as the ongoing maintenance of the property. Again, check out the building envelope reports.

There are a number of buildings in the city that have been partially rainscreened. You'll have to treat these as "unrainscreened," potentially leaky condos and make sure that you review any engineering or building envelope reports for the entire development.

We recently looked at a development that was partially rainscreened a few years ago. New owners who thought that they were protected were surprised when there was a special assessment of more than $4 million to complete the rainscreening on other buildings in the same strata. The assessment was more than $100,000 for the average condo owner.

And finally, new properties. Most buyers think that they don't have to be concerned about properties built in the past few years. Think again. New buildings come with a mandatory 2-5-10 warranty. That's two years on materials and labour, five years on the building envelope and 10 years on the structure. Some new buildings have longer warranties but these are the ones you can count on. Rainscreened properties have similar warranties for two and five years but don't have the 10-year warranty on the structure.

The concern that buyers should have about these warranties is that the coverage will be limited if your strata does not adequately maintain the building as specified by the warranty. Any defects must be reported within the requisite time period. The strata must have the common property inspected prior to the expiration of these warranties or it will not be covered, even if the damage occurred before the expiry date.

Common sense, right. Well, lots of stratas don't do this because they don't want to incur the cost of the warranty inspection. So if you're an owner, make sure your strata is addressing the warranty issues. If you're a prospective buyer, ask the owner or listing agent to obtain the warranty information for you.

For more information, check out the Homeowner Protection Office's 'Buying a Home in British Columbia - A Consumer Protection Guide' on our Reports page.

© Copyright (c) Vancouver Courier

The information in this article was current at 06 Dec 2011

Keywords: Home inspector, Leaky Condo Crisis

Other products and services from Abbey Partners

09-12-2011

Deb & Perry Abbey : Home - building envelope reports

In order to protect yourself and your investment, conventional wisdom recommends that before you buy a condo, you read the Form B Information Certificate, the Seller’s Property Disclosure Statement and the last two years of minutes from Strata Council Meetings and AGM’s.


09-12-2011

Deb & Perry Abbey : Home - year mortgage rates

While lenders aren’t jumping to lower rates, Rob Regan-Pollock at Invis, a Vancouver mortgage brokerage firm, predicts that rates could come down to 3 to 3.25 per cent on five-year fixed terms. Largely spurred on by U.S. economic news and European debt concerns, Government of Canada Bonds are becoming very popular and that means that bond prices are rising and yields are dropping.


09-12-2011

Deb & Perry Abbey : Home - home staging, staging your home to sell

Leave a spot in your sink cabinet or a drawer where you can tuck away your toothbrush and other personal hygiene items when there's a showing. Within seconds of seeing your home, buyers form an impression that will stay with them through the rest of the showing and after. I usually get rid of things I haven't used in five years, and pack up what I haven't used in the past year.


09-12-2011

Deb & Perry Abbey : Home - downsizing baby boomers, downsizing, retirement, real estate, condos

People considering downsizing in many other parts of North America have the added challenge of having to sell their home for a fraction of what it was worth a few years ago. Needless to say, we did a lot more sorting, invited our friends back for seconds, and made another dozen trips to the Sally Ann before we finally got settled.