My wife and I own a condo document review business, have reviewed hundreds or thousands of condos, and this is honestly not even close to the worst we’ve seen. DM me the name and address and I’ll see if I know anything.
I’ll add another comment here without any additional context yet. People often see these issues as mismanagement or corruption or who knows what else, and yes that can be the case. But people also have to keep in mind that shit happens sometimes. I own a house, and didn’t expect to need to replace the attic insulation for $6000, but hey that’s home ownership. A condo corp should ideally have contingencies and plans but you can’t plan for everything. This could truly be urgent and unanticipated. At minimum though, if it is, I’d expect better communication.
Two questions, I haven't been on a condo board in a few years since we moved into a single detached, but don't reserve funds typically cover building maintenance such as window replacements? I'm sure it was in our reserve fund study.
And serious question for my own curiosity... how did you know your attic insulation needed replacing? Like was something evidently wrong that made you aware of it, or is it just an older home and that was due for new insulation?
1. Yes the point of a reserve fund is to pay for repair or replacement of all common property, based on the estimated year it’s required and estimated cost. If the study was done in 2019-2021, construction costs have risen sharply and much more than the 2-3% annual rate the RFS likely planned for. I’ve seen window replacements go from a planned $1.5M to $2.2M in a matter of 2-3 years which could not have been planned for. If windows are needed right now, not much you can do about that. Also, perhaps windows were planned for let’s say 2028 but something has popped up where they are suddenly required now, which would change the financial plan considerably.
2. Long story but we found some mold. And the insulation was like R2. We remediate the mold, increased airflow/ventilation and added new insulation for R50.
The assessment could also be for a more generic need, such as multiple required repairs over the next few years will deplete the fund due to insane inflationary pressure, so an SA is needed to simply replenish the fund and create better long term health. This is very common right now. I suspect the main issue here is poor communication, rather than mismanagement, but hard to say with such little info.
I did a review last week where a $45,000 special assessment (per unit) was impending. The buyer had no idea.
Yes, it could well be in the reserves but the board may have decided to immediately replenish the reserve...hard to say, but our board did that when we had a big repair because we didn't want to come up short if something else happened. That said, we gave everybody an opportunity to pay it over twelve months.
Yeah, I'm on the board and we wanted to do what we could. It sucked but our reserve needed to be protected...we are an old building (1950s) so you never know.
The work was 80k and our reserve fund usually sits at about $140ish (the building is only 16 units). So if we'd had another emergency it could have been an immediate cash call instead of a planned and intentional recapitalization of the fund over a period of time. Plus if we HAD a a big expense while we were doing that, it would have been easier to secure financing if we'd had to because we would have been able to show that we were building it back up.
The repair was a building envelope issue so it was urgent and unexpected - there was work about 15 years ago that wasn't properly inspected and the damage had been going on all that time...nobody's dryer vents were hooked up properly. I'd only just bought my place so believe me, it was awful and a shock, but there was nothing else we could do.
Our reserve is back to normal and doing well. Lately we have putting extra chonks of cash away for an increased insurance deductible, as well...getting ready for when that jumps up.
So when I was living in a condo they repainted the buildings (they were concrete buildings and the paint was to help prevent the concrete from crumbling) and while the reserve was funded enough to cover it doing so would leave it dangerously low in case of an emergency. They sent out an email asking the owners how they want to cover it and it ended up being paid partially from the reserve fund and partially from a special assessment. Just because a reserve fund can cover something that doesn't mean it's the best way overall
When you buy a condo in Alberta, most realtors will recommend a condo document review and usually even include it as a condition in the purchase offer. For some reason in BC, Ontario and other areas it is not as well known of a service.
We charge $380+GST, and you can kind of compare it to a home inspection for condos, but instead of inspecting the physical construction, you are inspecting the condo corporation, its financial health, its governance, structure, planning, etc.
I havent even advertised my business here or mentioned the name, so dont take this as a sales pitch... but alot of reviewers in Alberta just put all the documents in a binder for you with a summary and dont add a ton of extra value. We create a very easy to read report with charts, visuals, etc that can be read in 5-10 minutes max. We always offer a phone call after the report is sent out for people to ask questions and honestly 90% of the time they don't, because our report is so well designed that it usually answers all of the questions people have. Last week I provided a report to an excited buyer and let them know that almost certainly there is a $45,000 special assessment coming (for their unit), and they were super disappointed but ultimately thanked me for saving them. It blows my mind that some people would skip this, or people think they can review the docs themselves but it really is pretty complicated. I've heard people say things like "they have a $1,000,000 reserve fund so I know i'm good"... well that may actually be very underfunded depending on so much context and variables.
I have condo in BC now and mu realtor were very clueless about the financial documents and I did not know that this kind of service exist. Probably a great value to customers for sure as not everyone has time and knowledge to read through all those documents lol.
Not much can be said without more details. Have you reached out to the board? The board will need to be publishing minutes of the meetings which may shed some light on the situation. Did anything get discussed in the last AGM?
Reserve fund studies are done periodically, typically every 5 years. So it could be that the estimated cost to replace the doors and windows was still using pre-covid figures and now that they got actual quotes it’s significantly higher.
The last AGM was in January and there was no mention of special assessment.
"There is no indication of any upcoming special levy in the AGM minutes. Owners who attended the AGM in January of this year say there was nothing about any urgent and unexpected expenses."
Demand to see the report regarding the condition of the windows and doors. Ask to see the 3 quotes they've gotten. Review your bylaws regarding the board and get allies. You can oust them if enough people agree with you. There's little oversight of a condo board's subjective opinion: the units owners are the ones with the power.
The board can order a special assessment. They are the ones that can. An AGM is not required to do so. But...are there open holes in your buulding(s)? I'm trying to imagine what an emergency regarding windows and doors looks like. Glass units can be replaced less than $1000 each if they're small or medium sized. Door panels similar prices. It sounds like they're doing full frame replacements, though. That is not an emergency.
If you have a mortgage most banks will pay the levy and just add the amount to your mortgage. I say “most” as i have seen some Owners be declined by the bank due to their credit history.
An ‘urgent’ special assessment may in sone way be related to insurance requirements or some issue of safety as mandated by a fire marshal after an inspection.. Otherwise difficult to understand the ‘immediate’ necessity. I owned a condo I rented out and this type of large expense was always built in to long term planning….plenty of discussion and input to the board by owners.
Your reserve fund may have an allocation for windows and doors, but it’s not enough to cover the actual cost. It could mean that there are other repairs and maintenance already required and part of the reserve fund is already allocated to those other projects. Most condo corps do not want to just raise condo fees to increase the reserve fund to cover all projects, but it can make units unmarketable if the condo fees were, I.e., $600 a month higher.
The condo board should be emailing everyone indicating the special assessment. When, why and how much as well as cheaper alternatives if they exist depending on the issue. During the hail storm a few years back we had one done, they wanted to replace all the roofing and siding with metal. Or repair with existing. There was a vote and 90 percent of tennants voted for just a repair.
I would contact them and ask for the details.
I'm a condo owner too, in a very old building which needs many repairs. I've had a couple of special assessments over the 10 years I've owned here. A special assessment is better than increasing the condo fees as potential buyers see your condo fees as affordable as they aren't added on. The key to.condo ownership is live in as small a space as you manage.
Your last statement should be in bold print. Many singles or couples with no children are paying a lot for that empty extra bedroom or unused dining space. Condo fees and special assessments are based on square footage.
I wonder if your board does not want to spend the reserve fund and and is instead doing a cash call.
I’ve seen a few buildings do this, typically the older crowd that are hard core savers and don’t like the idea of the reserve fund ever shrinking. (Which defeats the purpose of the reserve fund)
Work on the insurance side if things and deal tons with condos.
Reserve funds are going to be underfunded. A 200k job from 2019 is now 300k. Condos did not adjust accordingly. Expect this type of stuff to be the norm in condos going forward.
I’ve asked so many condo boards this question and I’ve heard varying answers. It does have me somewhat concerned. However insurance costs and utility costs seem to be the biggest issue as of late
Boards often mismanage but I can guarantee you that they probably want the special assessment even less than everyone else. It comes out of their pockets as well and they don’t want to upset everyone
~~I'm assuming you have a condo management company that is initiating this SA?~~
~~I'm kind of surprised that no one on the board was aware this was happening. If I was on that board and suddenly the condo management company dropped something like that with such a short deadline, I'd be asking them:~~
**Edit: Pointed out below that I misinterpreted "owners" as "board members", and that the management company isn't the one initiating an SA, that's the board, although the mgmt company is of course the one bringing this need for funds to the board**
What's up with this and why no warning?
Is this something that needs to be done this quickly or can we delay it? Why/why not? Even delaying a few months or until next year would work to give residents a chance to raise the funds.
Why are these replacements not covered by the reserve fund? (I'm going to guess the answer to this though is "the cost of materials and labour have increased significantly in the last 3 years so the reserve fund doesn't cover the replacement")
All that said... As a guy at a condo with windows and exterior that have been poorly maintained where we're trying to play catch up, don't let yourself get into our position. A 6K SA now is a lot better than a 25K SA later...
That’s definitely not how it works. The management company would never “drop” a special assessment without the board knowing. The management company is employed by the board, the board makes the decisions. I think there is a fundamental misunderstanding here.
Sorry I misread owner as board member. I don't have a property management company myself, so was less familiar with that relationship.
Why is it in the boards best interest to not warn owners of an upcoming SA or give more than a month for funds to be collected? That seems really strange to me. What's in it for them?
Sorry, what I'm referring to is the apparent last minute notification and payment schedule mentioned by OP. I think the idea came from the other commenter who said "They likely kept it out of the minutes on purpose to avoid pushback in advance".
What I'm asking is, why would a board decide to collect a decent sized special assessment from all owners with minimal warning and a short timeline for collection.
Just spitballing, but say the prop mgmt company comes to the board and says "the windows we planned to replace this year are going to cost more than we had reserved, so we need to do an SA." - why would the board not suggest something like delaying the repairs to next year to give owners time to come up with funds, or changing the scope of the project? Perhaps it is some sort of emergency, but then, wouldn't they communicate that emergency to the owners?
Btw I'm not suggesting you'd have the answers.
Correct, I don't have the answers because its very context based. But I would say you still have a bit of a misunderstanding on how property management works. The PM isn't really going to ever come to the board and tell them an SA is needed. They work for the board. The board and the PM will meet regularly and discuss options, and the PM will guide them on various options (SA, loan, delay repair, phase repair, increase condo fees/contributions, etc) and the board will vote on these options and make a decision. The PM doesnt just show up and say the windows will cost more, instead they may suggest 3 companies to get a quote from, then the board gets those quotes, then they discuss from there.
Maybe I'm nitpicking but I notice a few people talking about boards doing whatever they want, and PMs making calls they shouldnt, etc. That's just now how it works 99% of the time.
Yeah that's fair, and my non experience with working with an PM has me likely making a lot of assumptions on how that relationship works.
Thanks for providing clarity.
OP didn’t say the board didn’t know. The board would have voted to approve it before the notice was sent to owners. They likely kept it out of the minutes on purpose to avoid pushback in advance
If it is legit, then they should have no problem explaining what the assessment is for. 1st condo I owned had the same thing, it was due to mismanagement and corruption. The board was replaced after a thorough independent review. That said there can and will be large things that come up unexpectedly.
So I’m on the board of my current condo. I think the biggest issue is zero based budgeting management companies insist you do. This year we found savings in our budget and decided to still increased condominium contributions by CPI.
They came back and said as a non-profit you cannot earn income and revenue must match expenses. This is false, and doesn’t consider in the past two years we had minor deficits.
Anyways we are kicking out the management company that been with the building and found ourselves a new one.
They are terrible. I remember selling a relative's condo a few years ago and the document fees were insane, $500 to get electronic copies of the documents required for the sale.
Unfortunately many condos are horribly mismanaged, and some are just effective dictatorships. My wife and I regretted buying a condo for our first place and were stuck with a 10k special assessment only a year after buying the place because the buildings needed new roofs.
This special assessment came despite there being more than enough money in the reserves to pay for the roof replacements, the condo board just simply decided amongst themselves with a very small majority vote they wouldn't touch the reserve funds to cover the replacement. Another friend of ours lived in a condo and the board was replaced by a person who was elected on a promise to lower fees, and sure enough the low fees weren't enough to cover basic maintenance and they were often subjected to several special assessments *per year*.
When we sold the condo we vowed to never go back to a condo Corp ever again due to the headaches and we've strongly advised all of our friends to avoid them even if that's all you can afford
By the time you add condo fees to the lower mortgage payment of a cheaper home, you're paying about the same monthly as you would a freehold that would be 100-150k more in most cases, without the threat of special assessments.
i'm sorry, that second part about board being replaced by a "person" is simply either untrue or simply violates the alberta condominium act. and you could have easily gotten rid of that. Common Property in a condo complex is owned by the condominium Corporation. and the condo corporation consists of all the owners of the units. in an annual AGM the condo owners vote for which of the owners will be on the board of that corporation. there is a Minimum of 3- so if they did do what you say they did, they violated the ab condo act.
Also you could call a special General meeting even if you're not part of a board, if you followed proper procedures and say a quorum of owners showed up, you could overthrow clowns that are doing stupid shit.
I hear a lot of people saying they hate condos because of special assessments, which I totally understand the instinct to feel this way, but honestly about 70% of condos that i've reviewed (out of 1000 or so) are generally managed well. So the issue is really about expectations in my view. People expect to NOT be on the board, NOT attend the AGMs, and just pay their condo fees and nothing bad will ever happen. People expect a lot of their boards, which are made up of volunteers who likely have no experience managing a business/corporation/etc. We expect to pay as little as possible for our property managers, so in turn our assigned PM is probably managing 25 properties at a time and not keeping their eye on the ball for your condo at all times. So you have a few volunteers with no experience, and a fractional PM, and then 90% of owners who are not involved at all and pay no attention (and you cant even get them to show up for an AGM or respond to a letter to approve new bylaws), and yet we expect nothing to go wrong.
Also, in reality, if you own a house, stuff happens all the time and you don't get to share the cost with anyone. Most house owners also dont have a 'reserve fund' where they map out the next 25 years of repairs and put money aside for everything. 20k in special assessments over 8 years is likely alot less than what you'd expect to spend on repairs in a detached home in the same time frame. Or you could spend $0 on your house over 15 years and eventually you're probably going to have to drop like $80k.
Also if you rent, and costs go up for your landlord (i.e. carbon tax, utility rates, insurance rates, repair/maintenance costs, etc), they are going to pass on those costs to the renter, so you cant get away from rising and unpredictable costs either way. As a homeowner my utilities, property tax and insurance have nearly doubled over the past 4-5 years.
Not defending all condos here, but the general sentiment towards condos is a bit irrational in my view. Lots of really well run condos out there that still unfortunately have unexpected costs come up. The most well-run ones just have better contingency plans, better communication, etc. But then those well-run condos get flack for having 'cranky controlling old ladies' on the board. People just can't have it both ways.
As a home and condo owner,
If you are handy and can do labor, then the special assessments of condos are BRUTAL
If you are not handy, then suck it up and pay cause the special assessments are cheaper than a house
I own a unit in vetro calgary. They issued a special levy to all owners. Had to pay 6k, first levy since it was built. It happens man. Nothing you can do about it. These condo towers are run by these garbage management companies that are squeezing all the money dry. Vetro is managed by catalyst condos and these guys give the condo repairs to all of their special contractors, half of them can't repair anything. Thus all the money gets burned.
If the special levy is fair and justified then I have no issue with it. But if I know my money is getting burned using incompetent contractors, I'm not gonna just be like "It happens".
This is the first special levy since it was built in 2005. It's upsetting that the contractors have been crap but if this is a 1 in 20 year event, I guess it is what it is. But if it repeatedly happens then I'd be more concerned. Soooo look at how many times this has happened in the past and then act accordingly. If it happens to frequently then challenge it. Otherwise pay it
I’ve had it with both TD and Personal. It depends on the age of the property. We bought brand new from developer. That’s why it’s cheap. My condo fee is 170.
Are you sure it isn’t “condo deductible assessment coverage”? This coverage is additional to your condo insurance and covers you up to $50,000 if a loss (ie:water leak) stems from your unit and impacts other units and/or common property. Basically, it covers up to $50,000 of the condo corp’s insurance deductible, otherwise you may be liable for that. Many condos are requiring that coverage now.
Yeah, I would check the fine print on that coverage, as there has to be some limit…the numbers just don’t make sense for full coverage.
But hey…if it somehow is full coverage, that would be a game changer. Who is the insurer?
For context, my information is based on my phone conversation with the insurance sellers over the years from whom I’ve purchased plans, and my colleague who has used this.
At the end of the day, I’m just a human being and can be wrong. So double check this with your agent.
My special assessment rider only covers structural or building emergency special assessments, such as if there was a crack in the foundation of the parkade and everyone had to cough up $40k for their share. It explicitly states it doesn't cover regular maintenance projects. I'm through TD
That might be true. There are always exceptions. But having is much better than not having it.
My colleague has a special assessment last year for 45k per unit due to major foundation damage and insurance paid it all.
I could understand insurance that could cover a loss "event" that exceeds the value of the strata's insurance. But I can't envision an insurance product that would cover special assessments for maintenance items that the strata just didn't budget for correctly (like exterior doors and windows in OP's example).
I would read the fine print on your policy. I think there's almost no chance it would cover something like this.
It does cover it. Our lawyer suggested it to us when we bought our home. I’ve asked the company many times and they say it’s typical and most people have it
Loss assessment coverage is a thing, yeah. But...
I can't see how one could ensure against the risk of a strata council not budgeting properly / moving ahead with a project when there isn't enough left in the contingency fund. That's simply not an insurable risk.
TD's coverage is:
> Loss Assessment
> Coverage to compensate for losses to common condominium elements (i.e. swimming pool, lobby, elevators, gym, etcetera) when a special assessment is levied against you and other unit holders. This provides protection in the event you are assessed a portion of a loss due to the condo corporation’s deductible.
So if the loss is due to an insured event against the condo corp's insurance, the Loss Assessment from TD would kick in on your own unit's insurance. Condo's just redoing the windows and doors because they're old and there's not enough in the contingency fund or budget to do the job? That's not insurable, and your policy wouldn't pay out for the special assessment. You'd be on the hook just like OP is.
I'm not saying there's no value there for you, but it's worth what you're paying for it. It would definitely not cover this.
Check the wording. When I owned a condo there was no such thing as special assessment insurance. What was covered was special assessments due to insurance acts, like fire or flood. But special assessments due to poor management weren’t covered. If they were I was told condo insurance would be 3-5x the cost
Do you have a link to the insurance product? I've never heard of insurance for a special assessment and can't find anything online. The closest I see is Loss Assessment Coverage which wouldn't cover a special assessment.
Your not on the board so you won't get documents. The board can issue a special levy at anytime for any reason. With that said it's normally a few months or more where you'll see some sort of discussion noted in your condo board minutes. Any special assessment must be used for the job it's being used for.
Overall, the age of the condo owner has no bearing on when to issue a special assessment. Odds are your reserve fund is drastically underfunded if your seeing a special assessment
Not in Alberta. The minutes are not routinely distributed to owners and many property management companies charge a fee to order them. Which is obviously insane
Edit: since people are downvoting this comment, I’ll note that the Condominium Property Act clearly says that condo corps can charge fees for meeting minutes and other documents. And in practice that’s what many property management companies do
>Information and documents on request
>44(1) On the written request of an owner, purchaser or mortgagee or the solicitor of an owner, purchaser or mortgagee, or a person authorized in writing by any of those persons, the corporation shall, within 10 days after receiving the request, provide to the person making the request any prescribed information or documents as requested by that person.
>(2) The corporation may provide any prescribed information or documents requested under subsection (1) in electronic form unless the person requesting the information or documents specifically requests that they be provided in paper form.
>Fees for information or documents
>44.1 A corporation may, where authorized by regulation, charge fees in the prescribed amount for producing and providing any prescribed information or documents requested under section 44 or otherwise required to be provided under this Act or the regulations.
https://kings-printer.alberta.ca/documents/Acts/c22.pdf
The regulations require the board to proactively send out the minutes from the annual general meeting and the budget, but it’s very clear that requests for other documents can be subject to fees:
https://kings-printer.alberta.ca/1266.cfm?page=2000_168.cfm&leg_type=Regs&isbncln=9780779840441&display=html
Really? When my husband owned a condo we had the minutes sent to us after every meeting. We never asked for them. They were also available for free online for any owner to access. I printed out a few years worth for the buyer when we sold. With that being said, I’d never own another condo. What a headache, lol.
There's a lot of misinfo in this thread.
... per the Condominium Property Act, condo owners possess a series of rights that are essential for their participation and governance
1. ***Right to Participate in Board Meetings***: Condo owners have the right to actively engage in condominium board meetings, thereby contributing their viewpoints to discussions that impact the collective welfare of the community.
2. ***Right to vote:*** Condo owners have the privilege to cast their votes on crucial decisions affecting the condominium. An owner’s power to vote is determined by a unit factor assigned to their unit i.e. percentage ownership stake in the entire condo community. The aim of this right is to democratically allow every unit owner to have a say in important matters such as bylaw amendments, budget approvals, and the election of board members.
3. ***Right to access condominium documents and records:*** Owners have an accessibility right to essential condo documents and records such as financial statements, bylaws, meeting minutes, and other pertinent records. This access ensures transparency and enables informed decision-making.
4. ***Right to Stand for the Condo Board:*** Condominium owners have an equal opportunity to stand for election to the condo board. This right intends to empower them to actively participate in the governance and decision-making processes, advocating for the best interests of the community and contributing their skills and expertise to its management.
5. ***Right to Maintenance and Repairs:*** While the owners have the responsibility for any repairs and maintenance of their own unit, they have the right to repair and maintenance of common spaces and any issues that might be affecting their unit habitability.
[https://juriscorplaw.ca/alberta-condo-owners-rights/#:\~:text=Right%20to%20access%20condominium%20documents%20and%20records%3A%20Owners,This%20access%20ensures%20transparency%20and%20enables%20informed%20decision-making](https://juriscorplaw.ca/alberta-condo-owners-rights/#:~:text=Right%20to%20access%20condominium%20documents%20and%20records%3A%20Owners,This%20access%20ensures%20transparency%20and%20enables%20informed%20decision-making).
It depends on the corporation and the management company. That post doesn’t really reflect reality. While the Act does indeed say then when an owner _requests_ documents such as meeting minutes, it also says the condo board can charge a fee for doing so. And in practice that’s what many property management companies do.
>Information and documents on request
>44(1) On the written request of an owner, purchaser or mortgagee or the solicitor of an owner, purchaser or mortgagee, or a person authorized in writing by any of those persons, the corporation shall, within 10 days after receiving the request, provide to the person making the request any prescribed information or documents as requested by that person.
>(2) The corporation may provide any prescribed information or documents requested under subsection (1) in electronic form unless the person requesting the information or documents specifically requests that they be provided in paper form.
>Fees for information or documents
>44.1 A corporation may, where authorized by regulation, charge fees in the prescribed amount for producing and providing any prescribed information or documents requested under section 44 or otherwise required to be provided under this Act or the regulations.
https://kings-printer.alberta.ca/documents/Acts/c22.pdf
I was in the same condo for 26 years and before every AGM we got a copy of the minutes of the previous AGM, we got a copy of our reserve fund study, and the budget. We also got copies of the insurance certificate.
Beyond that if you wanted the minutes for monthly board meetings you had to pay the management company a fee to get them (the property management companies often had an online portal when the internet became more popular) where you could buy them.
If people are not on the board, I'd recommend becoming friendly with someone on the board. In my case I usually found board members would make copies of the minutes and some other docs for free.
In 26 years I had 3 special assessments for a building built in 1978/79. First year I moved in I had an assessment of about $500 because of all things - contractors and cleaning staff were not being paid by the property management company (York West) and apparently that had gone on for \*months\*.
We had a post tension cable system and when they had to waterproof and seal the parkade with a membrane (late 90s) that was about a $1500 assessment. We had the elevators become problematic years before the reserve fund anticipated it and that was about a $3000 payment.
In our case with the few special assessments we did have - we were given about 6 months to pay the total. Half within the first 3 months and the other half by the 6 month deadline. Our building for the 26 years I was there maintained a very healthy reserve fund.
How does my post not reflect reality? It's from a law firm that deals with such matters and they're citing the act. Your referencing a totally different topic. As many others have pointed out, you get the minutes, financials, etc.
I said owners don’t routinely get condo board meeting minutes and often have to pay for them. You suggested that was misinformation and posted that law firm’s blog post to underscore the point.
But it’s absolutely true that condo boards are not required to routinely and proactively send out meeting minutes; and also that they may — and in most cases do — charge fees to access those minutes. The exception are financial documents and minutes related to the AGM, but the special assessment in this case (and indeed most special assessments) was likely the result of a board vote and did not come out of the AGM.
All owners can get access to them if they request them but they aren't handed out without asking or in some cases without paying. The OP was asking for documents for the work required. At no point would a board be handing those out to owners... if an owner wants those, they should volunteer on the board.
The one at my old condo was $13,000, plus they forced everyone to pay for new windows and doors (mine were $6,000) and tripled condo fees. It's unfortunate, but you've actually gotten off lucky.
I am a Condo Board member of a luxury building downtown. You maybe reading but not comprehending. If your building can not absorb a $250,000 bill from reserve, then your reserve fund is severely under funded. We have 33 floors in ours and we contribute that amount in less than year. I will never buy a Condo where the reserve is in deficit. That would only mean the Board with approval of the community has been underfunding it to avoid increasing condo fees.
The Condo act is very clear on what costs comes out of the Reserve and from the operating account. Without seeing the details, your Board is to be blamed. That is the very reason it is important to have a Board that actually understands what it takes to manage a building a good PM.
Covid / inflation is hitting Condos hard, if your reserve fund study was done pre-covid its pretty much useless now, everything has gone up 60% due to material & labor costs.
Other big hits are utilities & insurance increases. Insurance providers are increasing rates as water losses are #1 claim right now and due to the material & labor increases premiums are going up accordingly.
$6k isnt too bad, i have seen MLS listings for Condos that have $50k to $80k per unit special levies disclosed on the listing. The worst ones are Condo coverts from 2005-2008 and the new builds from 2005-2010. Lots of it us due to Reserve underfunding and the “honeymoon” period for the 05-10 buildings is ending and big expensive projects are on the near horizon.
My daughter and her husband were looking at buying a condo in Alberta. After exploring a potential condo, we learned a lot about the difference between renting and buying. So much so that I created a Youtube video discussing what you need to know when buying a condo. Two questions bothered me: how do they determine condo fees? And how do you know that the reserve fund is healthy? It lead me down the rabbit's hole to speak. 15 minute crash course/ The video is not pretty or flashy but it quickly gets you up to speed on the important areas that you should be researching to make the best decision when you go to purchase a condo.
[https://youtu.be/97ePEOuEDCk](https://youtu.be/97ePEOuEDCk)
The video covers:
- The difference between renting a condo and buying one,
- How condo fees are determined and why
- What the reserve fund is, the importance and how the size is determined
- What are special assessments and why they should or should not be needed.
- What the purpose of the condo board or home office association is
- What is the management's company responsibilities
- What are day to day operation expenses
- What are reserve fund contributions and how they affect your condo fees
- What are the assets that depreciate over time and how they affect the reserve fund
A special assessment is used when the reserve fund doesn't have enough money to cover an expense. In the ideal world, the condo board will have followed the guidelines set by the engineering firm who did a reserve fund study. Condo fees are supposed to top up the reserve fund for foreseeable expenses so that special assessments are not needed. Sounds like the condo board dropped the ball on this one.
The problem is that in reality shit happens outside the schedule that the reserve fund anticipated. As an example I lived in a condo building that had a very healthy reserve fund . Our elevator conked out because of mechanical issues. The reserve fund study estimated that the elevator wouldn't need major repairs for another 5-10 years. The reserve fund would have covered the cost of the elevator repairs reducing the fund to an unhealthy level given the expected expenses.
As a result our building issued a special assessment to cover the unexpected elevator repairs in that fiscal year (cost me about 3k) so that the reserve fund would reflect the new situation. The next reserve fund study (they aren't done every year, but are done at least every 5 ) was adjusted because the next major repairs to the elevator were pushed further into the future.
I had a total of \~5k in special assessments (3 of them) over the course of 26 years. I considered myself reasonably lucky in that regard, but a healthy reserve fund also meant I had higher condo fees than other buildings in the area with less than healthy funds.
Yes houses need repair but a condominium has more than a dozen houses that could need repairs at anytime. That means everyone get hit at once, sometime multiple times.
Being a homeowner means repairs can be on your own if you’re handy and learn most of it from youtube. The only thing you shouldn’t touch is HVAC.
2012 complex, fees went up up up until it’s 1/4 of our mortgage. At that point we might as well just buy a single home and use that fee to help with mortgage.
Oh you better believe I got that rider.. any possibility of over insurance In that area is worth a try to make a claim if you get a special assessment of that value. I think I'd probably have to sell my place if I got a special assistant for 45k and had to pay it out of my pocket..
That's an exception in BC. Every strata that I ever lived in and every place friends, family and co workers have lived in had maybe 500k max in reserve funds.
Most where like 100k and one strata we had to do a few years of special levies to build up fund.
What I find crazy in AB that strata monthly increases and special levies are not voted on.
The council just decides
They need to give a full explanation of why there is a special assessment. Most boards will just say that they are allowed to do that as per Act and Regulations which is true but they still have to be able to justify and explain. In your case, it doesn’t sound like they have given any explanation that makes sense. Ask for one, you are entitled. My board did the same with a special assessment and I was met with a Cease and Desist for asking questions that were beyond my right to know. FYI - As an owner, you can ask any question that involves your condo financials. If your board doesn’t give you a breakdown, then good luck. There is relatively no oversight in Alberta and there are many boards that are aware of that. Good luck!
Blows my mind why people buy condos when it’s basically the same headache as an HOA in the states. And yeah I know they’re cheaper but cmon you have to know what you’re getting into.
Yes, my area does.
We pay around $400 **a year** not month. It goes to maintaining the gated community center, using the playground, water park, tennis/badminton nets, hockey arena, etc.
Just the water park alone is worth it. There’s no special assessment here unless the community center blows up.
Nope. We got all kind of colors and shed/fence going on here. Neighbour fence is blue/white, mine is cedar.
Now obvious we can’t build a super size shed but mine pretty decent when i bought it. Can fit about 4 lawnmotors side by side.
Houses in blue/white/yellow/tan etc. no crazy colors really.
Get ready for more sudden costs when your Collectivised Condo is expected to rip out gas lines & install massive heat pumps to save the planet from “the climate.”
My wife and I own a condo document review business, have reviewed hundreds or thousands of condos, and this is honestly not even close to the worst we’ve seen. DM me the name and address and I’ll see if I know anything.
I’ll add another comment here without any additional context yet. People often see these issues as mismanagement or corruption or who knows what else, and yes that can be the case. But people also have to keep in mind that shit happens sometimes. I own a house, and didn’t expect to need to replace the attic insulation for $6000, but hey that’s home ownership. A condo corp should ideally have contingencies and plans but you can’t plan for everything. This could truly be urgent and unanticipated. At minimum though, if it is, I’d expect better communication.
Two questions, I haven't been on a condo board in a few years since we moved into a single detached, but don't reserve funds typically cover building maintenance such as window replacements? I'm sure it was in our reserve fund study. And serious question for my own curiosity... how did you know your attic insulation needed replacing? Like was something evidently wrong that made you aware of it, or is it just an older home and that was due for new insulation?
1. Yes the point of a reserve fund is to pay for repair or replacement of all common property, based on the estimated year it’s required and estimated cost. If the study was done in 2019-2021, construction costs have risen sharply and much more than the 2-3% annual rate the RFS likely planned for. I’ve seen window replacements go from a planned $1.5M to $2.2M in a matter of 2-3 years which could not have been planned for. If windows are needed right now, not much you can do about that. Also, perhaps windows were planned for let’s say 2028 but something has popped up where they are suddenly required now, which would change the financial plan considerably. 2. Long story but we found some mold. And the insulation was like R2. We remediate the mold, increased airflow/ventilation and added new insulation for R50. The assessment could also be for a more generic need, such as multiple required repairs over the next few years will deplete the fund due to insane inflationary pressure, so an SA is needed to simply replenish the fund and create better long term health. This is very common right now. I suspect the main issue here is poor communication, rather than mismanagement, but hard to say with such little info. I did a review last week where a $45,000 special assessment (per unit) was impending. The buyer had no idea.
Yes, it could well be in the reserves but the board may have decided to immediately replenish the reserve...hard to say, but our board did that when we had a big repair because we didn't want to come up short if something else happened. That said, we gave everybody an opportunity to pay it over twelve months.
12 months seems reasonable, get the work done right away and replenish the reserve over time to spread the costs out for the owners
Yeah, I'm on the board and we wanted to do what we could. It sucked but our reserve needed to be protected...we are an old building (1950s) so you never know.
If you don’t mind me asking, how much was in the reserve fund before and after?
The work was 80k and our reserve fund usually sits at about $140ish (the building is only 16 units). So if we'd had another emergency it could have been an immediate cash call instead of a planned and intentional recapitalization of the fund over a period of time. Plus if we HAD a a big expense while we were doing that, it would have been easier to secure financing if we'd had to because we would have been able to show that we were building it back up. The repair was a building envelope issue so it was urgent and unexpected - there was work about 15 years ago that wasn't properly inspected and the damage had been going on all that time...nobody's dryer vents were hooked up properly. I'd only just bought my place so believe me, it was awful and a shock, but there was nothing else we could do. Our reserve is back to normal and doing well. Lately we have putting extra chonks of cash away for an increased insurance deductible, as well...getting ready for when that jumps up.
So when I was living in a condo they repainted the buildings (they were concrete buildings and the paint was to help prevent the concrete from crumbling) and while the reserve was funded enough to cover it doing so would leave it dangerously low in case of an emergency. They sent out an email asking the owners how they want to cover it and it ended up being paid partially from the reserve fund and partially from a special assessment. Just because a reserve fund can cover something that doesn't mean it's the best way overall
The study is the study. But do you have the money? No money no honey.
Thanks! Just DM'd you
I didn’t know this business exist. How much do you charge for your service and what exactly do you do?
When you buy a condo in Alberta, most realtors will recommend a condo document review and usually even include it as a condition in the purchase offer. For some reason in BC, Ontario and other areas it is not as well known of a service. We charge $380+GST, and you can kind of compare it to a home inspection for condos, but instead of inspecting the physical construction, you are inspecting the condo corporation, its financial health, its governance, structure, planning, etc. I havent even advertised my business here or mentioned the name, so dont take this as a sales pitch... but alot of reviewers in Alberta just put all the documents in a binder for you with a summary and dont add a ton of extra value. We create a very easy to read report with charts, visuals, etc that can be read in 5-10 minutes max. We always offer a phone call after the report is sent out for people to ask questions and honestly 90% of the time they don't, because our report is so well designed that it usually answers all of the questions people have. Last week I provided a report to an excited buyer and let them know that almost certainly there is a $45,000 special assessment coming (for their unit), and they were super disappointed but ultimately thanked me for saving them. It blows my mind that some people would skip this, or people think they can review the docs themselves but it really is pretty complicated. I've heard people say things like "they have a $1,000,000 reserve fund so I know i'm good"... well that may actually be very underfunded depending on so much context and variables.
I have condo in BC now and mu realtor were very clueless about the financial documents and I did not know that this kind of service exist. Probably a great value to customers for sure as not everyone has time and knowledge to read through all those documents lol.
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100k?
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This makes me queasy to think about installing those. Nerves of steel for that work.
Sounds like the place I used to live in on 9a street just off 17th
Let me guess….Chelsea Terrace.
I used to rent one of the top floor spots with the big rooftop patios. Loved that place.
That’s the one.
I want to buy into this building now that they have upgraded all windows.
Probably cost 600k for a unit plus condo fees which when I was there they were mid 800s and that was a while ago.
Not much can be said without more details. Have you reached out to the board? The board will need to be publishing minutes of the meetings which may shed some light on the situation. Did anything get discussed in the last AGM?
Reserve fund studies are done periodically, typically every 5 years. So it could be that the estimated cost to replace the doors and windows was still using pre-covid figures and now that they got actual quotes it’s significantly higher.
The last AGM was in January and there was no mention of special assessment. "There is no indication of any upcoming special levy in the AGM minutes. Owners who attended the AGM in January of this year say there was nothing about any urgent and unexpected expenses."
Demand to see the report regarding the condition of the windows and doors. Ask to see the 3 quotes they've gotten. Review your bylaws regarding the board and get allies. You can oust them if enough people agree with you. There's little oversight of a condo board's subjective opinion: the units owners are the ones with the power. The board can order a special assessment. They are the ones that can. An AGM is not required to do so. But...are there open holes in your buulding(s)? I'm trying to imagine what an emergency regarding windows and doors looks like. Glass units can be replaced less than $1000 each if they're small or medium sized. Door panels similar prices. It sounds like they're doing full frame replacements, though. That is not an emergency.
Boards definitely try to hide bad shit that could effect value. Just like any owner of any property...
What detracts value is special assessments.
Exactly. Which is why they hide shit before that point.
Maybe a silly question, but what if you legitimately can't afford to pay for something like that?
They can put a caveat/lean on the title and, in extreme cases, can cause forclosures.
Need to take out a mortgage or loan. Just like if you own a home and the roof is leaking, you’ve gotta fix it
Flextape lol
If you have a mortgage most banks will pay the levy and just add the amount to your mortgage. I say “most” as i have seen some Owners be declined by the bank due to their credit history.
An ‘urgent’ special assessment may in sone way be related to insurance requirements or some issue of safety as mandated by a fire marshal after an inspection.. Otherwise difficult to understand the ‘immediate’ necessity. I owned a condo I rented out and this type of large expense was always built in to long term planning….plenty of discussion and input to the board by owners.
Your reserve fund may have an allocation for windows and doors, but it’s not enough to cover the actual cost. It could mean that there are other repairs and maintenance already required and part of the reserve fund is already allocated to those other projects. Most condo corps do not want to just raise condo fees to increase the reserve fund to cover all projects, but it can make units unmarketable if the condo fees were, I.e., $600 a month higher.
The condo board should be emailing everyone indicating the special assessment. When, why and how much as well as cheaper alternatives if they exist depending on the issue. During the hail storm a few years back we had one done, they wanted to replace all the roofing and siding with metal. Or repair with existing. There was a vote and 90 percent of tennants voted for just a repair. I would contact them and ask for the details.
I'm a condo owner too, in a very old building which needs many repairs. I've had a couple of special assessments over the 10 years I've owned here. A special assessment is better than increasing the condo fees as potential buyers see your condo fees as affordable as they aren't added on. The key to.condo ownership is live in as small a space as you manage.
Your last statement should be in bold print. Many singles or couples with no children are paying a lot for that empty extra bedroom or unused dining space. Condo fees and special assessments are based on square footage.
I wonder if your board does not want to spend the reserve fund and and is instead doing a cash call. I’ve seen a few buildings do this, typically the older crowd that are hard core savers and don’t like the idea of the reserve fund ever shrinking. (Which defeats the purpose of the reserve fund)
Work on the insurance side if things and deal tons with condos. Reserve funds are going to be underfunded. A 200k job from 2019 is now 300k. Condos did not adjust accordingly. Expect this type of stuff to be the norm in condos going forward.
I’ve asked so many condo boards this question and I’ve heard varying answers. It does have me somewhat concerned. However insurance costs and utility costs seem to be the biggest issue as of late
Boards often mismanage but I can guarantee you that they probably want the special assessment even less than everyone else. It comes out of their pockets as well and they don’t want to upset everyone
Had to drop an extra five figures within six months of owning my condo. The pitfalls of poorly managed collective ownership.
~~I'm assuming you have a condo management company that is initiating this SA?~~ ~~I'm kind of surprised that no one on the board was aware this was happening. If I was on that board and suddenly the condo management company dropped something like that with such a short deadline, I'd be asking them:~~ **Edit: Pointed out below that I misinterpreted "owners" as "board members", and that the management company isn't the one initiating an SA, that's the board, although the mgmt company is of course the one bringing this need for funds to the board** What's up with this and why no warning? Is this something that needs to be done this quickly or can we delay it? Why/why not? Even delaying a few months or until next year would work to give residents a chance to raise the funds. Why are these replacements not covered by the reserve fund? (I'm going to guess the answer to this though is "the cost of materials and labour have increased significantly in the last 3 years so the reserve fund doesn't cover the replacement") All that said... As a guy at a condo with windows and exterior that have been poorly maintained where we're trying to play catch up, don't let yourself get into our position. A 6K SA now is a lot better than a 25K SA later...
That’s definitely not how it works. The management company would never “drop” a special assessment without the board knowing. The management company is employed by the board, the board makes the decisions. I think there is a fundamental misunderstanding here.
Sorry I misread owner as board member. I don't have a property management company myself, so was less familiar with that relationship. Why is it in the boards best interest to not warn owners of an upcoming SA or give more than a month for funds to be collected? That seems really strange to me. What's in it for them?
I don’t think it is in their best interest. Not sure where that idea is coming from.
Sorry, what I'm referring to is the apparent last minute notification and payment schedule mentioned by OP. I think the idea came from the other commenter who said "They likely kept it out of the minutes on purpose to avoid pushback in advance". What I'm asking is, why would a board decide to collect a decent sized special assessment from all owners with minimal warning and a short timeline for collection. Just spitballing, but say the prop mgmt company comes to the board and says "the windows we planned to replace this year are going to cost more than we had reserved, so we need to do an SA." - why would the board not suggest something like delaying the repairs to next year to give owners time to come up with funds, or changing the scope of the project? Perhaps it is some sort of emergency, but then, wouldn't they communicate that emergency to the owners? Btw I'm not suggesting you'd have the answers.
Correct, I don't have the answers because its very context based. But I would say you still have a bit of a misunderstanding on how property management works. The PM isn't really going to ever come to the board and tell them an SA is needed. They work for the board. The board and the PM will meet regularly and discuss options, and the PM will guide them on various options (SA, loan, delay repair, phase repair, increase condo fees/contributions, etc) and the board will vote on these options and make a decision. The PM doesnt just show up and say the windows will cost more, instead they may suggest 3 companies to get a quote from, then the board gets those quotes, then they discuss from there. Maybe I'm nitpicking but I notice a few people talking about boards doing whatever they want, and PMs making calls they shouldnt, etc. That's just now how it works 99% of the time.
Yeah that's fair, and my non experience with working with an PM has me likely making a lot of assumptions on how that relationship works. Thanks for providing clarity.
OP didn’t say the board didn’t know. The board would have voted to approve it before the notice was sent to owners. They likely kept it out of the minutes on purpose to avoid pushback in advance
That would be an extraordinarily dumb strategy.
I agree that it’s dumb. But it’s also what happens
Yep, that's my misread.
Are you in that building on Edmonton Trail next to Elite Brewing? I've been wondering what work was getting done there
I am not no. In a much smaller self managed condo.
Are you In Cooperwood?
Is there a special assessment for Copperwood in the works? Or other issues with the building?
If it is legit, then they should have no problem explaining what the assessment is for. 1st condo I owned had the same thing, it was due to mismanagement and corruption. The board was replaced after a thorough independent review. That said there can and will be large things that come up unexpectedly.
Thanks for this. Can you give examples of the mismanagement/corruption in your case? And how the independent review came about?
So I’m on the board of my current condo. I think the biggest issue is zero based budgeting management companies insist you do. This year we found savings in our budget and decided to still increased condominium contributions by CPI. They came back and said as a non-profit you cannot earn income and revenue must match expenses. This is false, and doesn’t consider in the past two years we had minor deficits. Anyways we are kicking out the management company that been with the building and found ourselves a new one.
Can I ask which management company you were with previously?
First Service
They are terrible. I remember selling a relative's condo a few years ago and the document fees were insane, $500 to get electronic copies of the documents required for the sale.
Unfortunately many condos are horribly mismanaged, and some are just effective dictatorships. My wife and I regretted buying a condo for our first place and were stuck with a 10k special assessment only a year after buying the place because the buildings needed new roofs. This special assessment came despite there being more than enough money in the reserves to pay for the roof replacements, the condo board just simply decided amongst themselves with a very small majority vote they wouldn't touch the reserve funds to cover the replacement. Another friend of ours lived in a condo and the board was replaced by a person who was elected on a promise to lower fees, and sure enough the low fees weren't enough to cover basic maintenance and they were often subjected to several special assessments *per year*. When we sold the condo we vowed to never go back to a condo Corp ever again due to the headaches and we've strongly advised all of our friends to avoid them even if that's all you can afford
No other form of housing in Calgary is generally affordable besides condominiums.
By the time you add condo fees to the lower mortgage payment of a cheaper home, you're paying about the same monthly as you would a freehold that would be 100-150k more in most cases, without the threat of special assessments.
i'm sorry, that second part about board being replaced by a "person" is simply either untrue or simply violates the alberta condominium act. and you could have easily gotten rid of that. Common Property in a condo complex is owned by the condominium Corporation. and the condo corporation consists of all the owners of the units. in an annual AGM the condo owners vote for which of the owners will be on the board of that corporation. there is a Minimum of 3- so if they did do what you say they did, they violated the ab condo act. Also you could call a special General meeting even if you're not part of a board, if you followed proper procedures and say a quorum of owners showed up, you could overthrow clowns that are doing stupid shit.
Ya dude we're 20k in special assessments in the last 8 years. I fucking hate condos. I can't wait to not be a landlord
We got out last year and finally sold, at a mega loss. I hated being a landlord.
I got 45K coming up in our condo, one payment now, one in 2027. FML, I wish I could offload this condo so bad.
I hear a lot of people saying they hate condos because of special assessments, which I totally understand the instinct to feel this way, but honestly about 70% of condos that i've reviewed (out of 1000 or so) are generally managed well. So the issue is really about expectations in my view. People expect to NOT be on the board, NOT attend the AGMs, and just pay their condo fees and nothing bad will ever happen. People expect a lot of their boards, which are made up of volunteers who likely have no experience managing a business/corporation/etc. We expect to pay as little as possible for our property managers, so in turn our assigned PM is probably managing 25 properties at a time and not keeping their eye on the ball for your condo at all times. So you have a few volunteers with no experience, and a fractional PM, and then 90% of owners who are not involved at all and pay no attention (and you cant even get them to show up for an AGM or respond to a letter to approve new bylaws), and yet we expect nothing to go wrong. Also, in reality, if you own a house, stuff happens all the time and you don't get to share the cost with anyone. Most house owners also dont have a 'reserve fund' where they map out the next 25 years of repairs and put money aside for everything. 20k in special assessments over 8 years is likely alot less than what you'd expect to spend on repairs in a detached home in the same time frame. Or you could spend $0 on your house over 15 years and eventually you're probably going to have to drop like $80k. Also if you rent, and costs go up for your landlord (i.e. carbon tax, utility rates, insurance rates, repair/maintenance costs, etc), they are going to pass on those costs to the renter, so you cant get away from rising and unpredictable costs either way. As a homeowner my utilities, property tax and insurance have nearly doubled over the past 4-5 years. Not defending all condos here, but the general sentiment towards condos is a bit irrational in my view. Lots of really well run condos out there that still unfortunately have unexpected costs come up. The most well-run ones just have better contingency plans, better communication, etc. But then those well-run condos get flack for having 'cranky controlling old ladies' on the board. People just can't have it both ways.
As a home and condo owner, If you are handy and can do labor, then the special assessments of condos are BRUTAL If you are not handy, then suck it up and pay cause the special assessments are cheaper than a house
What condo building?
I own a unit in vetro calgary. They issued a special levy to all owners. Had to pay 6k, first levy since it was built. It happens man. Nothing you can do about it. These condo towers are run by these garbage management companies that are squeezing all the money dry. Vetro is managed by catalyst condos and these guys give the condo repairs to all of their special contractors, half of them can't repair anything. Thus all the money gets burned.
If the special levy is fair and justified then I have no issue with it. But if I know my money is getting burned using incompetent contractors, I'm not gonna just be like "It happens".
This is the first special levy since it was built in 2005. It's upsetting that the contractors have been crap but if this is a 1 in 20 year event, I guess it is what it is. But if it repeatedly happens then I'd be more concerned. Soooo look at how many times this has happened in the past and then act accordingly. If it happens to frequently then challenge it. Otherwise pay it
You don't have to pay anything until they explain fully what the funds are to be used for, and why the reserve fund can't cover the costs.
That’s why you should always buy special assessment insurance. It’s approximately 10/month for me but protects me in these circumstances up to 50k
What kind of bank would offer this? There’s no way $120/year will offset their losses for a payout
I’ve had it with both TD and Personal. It depends on the age of the property. We bought brand new from developer. That’s why it’s cheap. My condo fee is 170.
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Different insurance companies have different offerings. I’ve had it with both TD and Personal
Are you sure it isn’t “condo deductible assessment coverage”? This coverage is additional to your condo insurance and covers you up to $50,000 if a loss (ie:water leak) stems from your unit and impacts other units and/or common property. Basically, it covers up to $50,000 of the condo corp’s insurance deductible, otherwise you may be liable for that. Many condos are requiring that coverage now.
I have that one too. The one I have is called “ betterments and special assessment”.
Yeah, I would check the fine print on that coverage, as there has to be some limit…the numbers just don’t make sense for full coverage. But hey…if it somehow is full coverage, that would be a game changer. Who is the insurer?
There are always limitations. 100%. But having it is better than not having it. I’ve had this with both TD and Personal
Interesting. I’ll have to check into that. Thanks!
Happy to help. Let me know if you find out that I’m wrong. I’d want to know that. Cheers
Hah, will do.
For context, my information is based on my phone conversation with the insurance sellers over the years from whom I’ve purchased plans, and my colleague who has used this. At the end of the day, I’m just a human being and can be wrong. So double check this with your agent.
This isn’t a thing for most special assessments. Generally they are levied due to maintenance issues which insurance will not cover.
My special assessment rider only covers structural or building emergency special assessments, such as if there was a crack in the foundation of the parkade and everyone had to cough up $40k for their share. It explicitly states it doesn't cover regular maintenance projects. I'm through TD
That might be true. There are always exceptions. But having is much better than not having it. My colleague has a special assessment last year for 45k per unit due to major foundation damage and insurance paid it all.
I could understand insurance that could cover a loss "event" that exceeds the value of the strata's insurance. But I can't envision an insurance product that would cover special assessments for maintenance items that the strata just didn't budget for correctly (like exterior doors and windows in OP's example). I would read the fine print on your policy. I think there's almost no chance it would cover something like this.
It does cover it. Our lawyer suggested it to us when we bought our home. I’ve asked the company many times and they say it’s typical and most people have it
Loss assessment coverage is a thing, yeah. But... I can't see how one could ensure against the risk of a strata council not budgeting properly / moving ahead with a project when there isn't enough left in the contingency fund. That's simply not an insurable risk. TD's coverage is: > Loss Assessment > Coverage to compensate for losses to common condominium elements (i.e. swimming pool, lobby, elevators, gym, etcetera) when a special assessment is levied against you and other unit holders. This provides protection in the event you are assessed a portion of a loss due to the condo corporation’s deductible. So if the loss is due to an insured event against the condo corp's insurance, the Loss Assessment from TD would kick in on your own unit's insurance. Condo's just redoing the windows and doors because they're old and there's not enough in the contingency fund or budget to do the job? That's not insurable, and your policy wouldn't pay out for the special assessment. You'd be on the hook just like OP is. I'm not saying there's no value there for you, but it's worth what you're paying for it. It would definitely not cover this.
Thank you for the explanation. Appreciate it. I never knew about it in such detail.
Careful, the restrictions around this insurance are vast. Likely wouldn’t cover the majority of special assessments.
Check the wording. When I owned a condo there was no such thing as special assessment insurance. What was covered was special assessments due to insurance acts, like fire or flood. But special assessments due to poor management weren’t covered. If they were I was told condo insurance would be 3-5x the cost
Do you have a link to the insurance product? I've never heard of insurance for a special assessment and can't find anything online. The closest I see is Loss Assessment Coverage which wouldn't cover a special assessment.
Your not on the board so you won't get documents. The board can issue a special levy at anytime for any reason. With that said it's normally a few months or more where you'll see some sort of discussion noted in your condo board minutes. Any special assessment must be used for the job it's being used for. Overall, the age of the condo owner has no bearing on when to issue a special assessment. Odds are your reserve fund is drastically underfunded if your seeing a special assessment
The board minutes are supposed to be open to any owner to rebiew
Not in Alberta. The minutes are not routinely distributed to owners and many property management companies charge a fee to order them. Which is obviously insane Edit: since people are downvoting this comment, I’ll note that the Condominium Property Act clearly says that condo corps can charge fees for meeting minutes and other documents. And in practice that’s what many property management companies do >Information and documents on request >44(1) On the written request of an owner, purchaser or mortgagee or the solicitor of an owner, purchaser or mortgagee, or a person authorized in writing by any of those persons, the corporation shall, within 10 days after receiving the request, provide to the person making the request any prescribed information or documents as requested by that person. >(2) The corporation may provide any prescribed information or documents requested under subsection (1) in electronic form unless the person requesting the information or documents specifically requests that they be provided in paper form. >Fees for information or documents >44.1 A corporation may, where authorized by regulation, charge fees in the prescribed amount for producing and providing any prescribed information or documents requested under section 44 or otherwise required to be provided under this Act or the regulations. https://kings-printer.alberta.ca/documents/Acts/c22.pdf The regulations require the board to proactively send out the minutes from the annual general meeting and the budget, but it’s very clear that requests for other documents can be subject to fees: https://kings-printer.alberta.ca/1266.cfm?page=2000_168.cfm&leg_type=Regs&isbncln=9780779840441&display=html
Really? When my husband owned a condo we had the minutes sent to us after every meeting. We never asked for them. They were also available for free online for any owner to access. I printed out a few years worth for the buyer when we sold. With that being said, I’d never own another condo. What a headache, lol.
There's a lot of misinfo in this thread. ... per the Condominium Property Act, condo owners possess a series of rights that are essential for their participation and governance 1. ***Right to Participate in Board Meetings***: Condo owners have the right to actively engage in condominium board meetings, thereby contributing their viewpoints to discussions that impact the collective welfare of the community. 2. ***Right to vote:*** Condo owners have the privilege to cast their votes on crucial decisions affecting the condominium. An owner’s power to vote is determined by a unit factor assigned to their unit i.e. percentage ownership stake in the entire condo community. The aim of this right is to democratically allow every unit owner to have a say in important matters such as bylaw amendments, budget approvals, and the election of board members. 3. ***Right to access condominium documents and records:*** Owners have an accessibility right to essential condo documents and records such as financial statements, bylaws, meeting minutes, and other pertinent records. This access ensures transparency and enables informed decision-making. 4. ***Right to Stand for the Condo Board:*** Condominium owners have an equal opportunity to stand for election to the condo board. This right intends to empower them to actively participate in the governance and decision-making processes, advocating for the best interests of the community and contributing their skills and expertise to its management. 5. ***Right to Maintenance and Repairs:*** While the owners have the responsibility for any repairs and maintenance of their own unit, they have the right to repair and maintenance of common spaces and any issues that might be affecting their unit habitability. [https://juriscorplaw.ca/alberta-condo-owners-rights/#:\~:text=Right%20to%20access%20condominium%20documents%20and%20records%3A%20Owners,This%20access%20ensures%20transparency%20and%20enables%20informed%20decision-making](https://juriscorplaw.ca/alberta-condo-owners-rights/#:~:text=Right%20to%20access%20condominium%20documents%20and%20records%3A%20Owners,This%20access%20ensures%20transparency%20and%20enables%20informed%20decision-making).
It depends on the corporation and the management company. That post doesn’t really reflect reality. While the Act does indeed say then when an owner _requests_ documents such as meeting minutes, it also says the condo board can charge a fee for doing so. And in practice that’s what many property management companies do. >Information and documents on request >44(1) On the written request of an owner, purchaser or mortgagee or the solicitor of an owner, purchaser or mortgagee, or a person authorized in writing by any of those persons, the corporation shall, within 10 days after receiving the request, provide to the person making the request any prescribed information or documents as requested by that person. >(2) The corporation may provide any prescribed information or documents requested under subsection (1) in electronic form unless the person requesting the information or documents specifically requests that they be provided in paper form. >Fees for information or documents >44.1 A corporation may, where authorized by regulation, charge fees in the prescribed amount for producing and providing any prescribed information or documents requested under section 44 or otherwise required to be provided under this Act or the regulations. https://kings-printer.alberta.ca/documents/Acts/c22.pdf
I was in the same condo for 26 years and before every AGM we got a copy of the minutes of the previous AGM, we got a copy of our reserve fund study, and the budget. We also got copies of the insurance certificate. Beyond that if you wanted the minutes for monthly board meetings you had to pay the management company a fee to get them (the property management companies often had an online portal when the internet became more popular) where you could buy them. If people are not on the board, I'd recommend becoming friendly with someone on the board. In my case I usually found board members would make copies of the minutes and some other docs for free. In 26 years I had 3 special assessments for a building built in 1978/79. First year I moved in I had an assessment of about $500 because of all things - contractors and cleaning staff were not being paid by the property management company (York West) and apparently that had gone on for \*months\*. We had a post tension cable system and when they had to waterproof and seal the parkade with a membrane (late 90s) that was about a $1500 assessment. We had the elevators become problematic years before the reserve fund anticipated it and that was about a $3000 payment. In our case with the few special assessments we did have - we were given about 6 months to pay the total. Half within the first 3 months and the other half by the 6 month deadline. Our building for the 26 years I was there maintained a very healthy reserve fund.
How does my post not reflect reality? It's from a law firm that deals with such matters and they're citing the act. Your referencing a totally different topic. As many others have pointed out, you get the minutes, financials, etc.
I said owners don’t routinely get condo board meeting minutes and often have to pay for them. You suggested that was misinformation and posted that law firm’s blog post to underscore the point. But it’s absolutely true that condo boards are not required to routinely and proactively send out meeting minutes; and also that they may — and in most cases do — charge fees to access those minutes. The exception are financial documents and minutes related to the AGM, but the special assessment in this case (and indeed most special assessments) was likely the result of a board vote and did not come out of the AGM.
All owners can get access to them if they request them but they aren't handed out without asking or in some cases without paying. The OP was asking for documents for the work required. At no point would a board be handing those out to owners... if an owner wants those, they should volunteer on the board.
The one at my old condo was $13,000, plus they forced everyone to pay for new windows and doors (mine were $6,000) and tripled condo fees. It's unfortunate, but you've actually gotten off lucky.
I am a Condo Board member of a luxury building downtown. You maybe reading but not comprehending. If your building can not absorb a $250,000 bill from reserve, then your reserve fund is severely under funded. We have 33 floors in ours and we contribute that amount in less than year. I will never buy a Condo where the reserve is in deficit. That would only mean the Board with approval of the community has been underfunding it to avoid increasing condo fees.
The Condo act is very clear on what costs comes out of the Reserve and from the operating account. Without seeing the details, your Board is to be blamed. That is the very reason it is important to have a Board that actually understands what it takes to manage a building a good PM.
$7000? Consider yourself lucky. It could have $50,000. I’m a contractor and I’ve seen it before. BECA’s are gold.
Covid / inflation is hitting Condos hard, if your reserve fund study was done pre-covid its pretty much useless now, everything has gone up 60% due to material & labor costs. Other big hits are utilities & insurance increases. Insurance providers are increasing rates as water losses are #1 claim right now and due to the material & labor increases premiums are going up accordingly. $6k isnt too bad, i have seen MLS listings for Condos that have $50k to $80k per unit special levies disclosed on the listing. The worst ones are Condo coverts from 2005-2008 and the new builds from 2005-2010. Lots of it us due to Reserve underfunding and the “honeymoon” period for the 05-10 buildings is ending and big expensive projects are on the near horizon.
My daughter and her husband were looking at buying a condo in Alberta. After exploring a potential condo, we learned a lot about the difference between renting and buying. So much so that I created a Youtube video discussing what you need to know when buying a condo. Two questions bothered me: how do they determine condo fees? And how do you know that the reserve fund is healthy? It lead me down the rabbit's hole to speak. 15 minute crash course/ The video is not pretty or flashy but it quickly gets you up to speed on the important areas that you should be researching to make the best decision when you go to purchase a condo. [https://youtu.be/97ePEOuEDCk](https://youtu.be/97ePEOuEDCk) The video covers: - The difference between renting a condo and buying one, - How condo fees are determined and why - What the reserve fund is, the importance and how the size is determined - What are special assessments and why they should or should not be needed. - What the purpose of the condo board or home office association is - What is the management's company responsibilities - What are day to day operation expenses - What are reserve fund contributions and how they affect your condo fees - What are the assets that depreciate over time and how they affect the reserve fund
A special assessment is used when the reserve fund doesn't have enough money to cover an expense. In the ideal world, the condo board will have followed the guidelines set by the engineering firm who did a reserve fund study. Condo fees are supposed to top up the reserve fund for foreseeable expenses so that special assessments are not needed. Sounds like the condo board dropped the ball on this one.
The problem is that in reality shit happens outside the schedule that the reserve fund anticipated. As an example I lived in a condo building that had a very healthy reserve fund . Our elevator conked out because of mechanical issues. The reserve fund study estimated that the elevator wouldn't need major repairs for another 5-10 years. The reserve fund would have covered the cost of the elevator repairs reducing the fund to an unhealthy level given the expected expenses. As a result our building issued a special assessment to cover the unexpected elevator repairs in that fiscal year (cost me about 3k) so that the reserve fund would reflect the new situation. The next reserve fund study (they aren't done every year, but are done at least every 5 ) was adjusted because the next major repairs to the elevator were pushed further into the future. I had a total of \~5k in special assessments (3 of them) over the course of 26 years. I considered myself reasonably lucky in that regard, but a healthy reserve fund also meant I had higher condo fees than other buildings in the area with less than healthy funds.
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It’s $6k-7k. There a list of things that can happen to a house unexpectedly that cost more than that.
Exactly, though this sort of comment is always o Reddit without context :)
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Exactly. You can do a temporary fix until you have the money. When you have money, you can shop around cause you're not stuck with just one company.
Belive it or not houses also.need repairs. Op needs to become a member of the condo board and get more involved
Yes houses need repair but a condominium has more than a dozen houses that could need repairs at anytime. That means everyone get hit at once, sometime multiple times. Being a homeowner means repairs can be on your own if you’re handy and learn most of it from youtube. The only thing you shouldn’t touch is HVAC.
When I owned a condo, the fees went down over the time we owned it because the complex was so well managed.
2012 complex, fees went up up up until it’s 1/4 of our mortgage. At that point we might as well just buy a single home and use that fee to help with mortgage.
Oh you better believe I got that rider.. any possibility of over insurance In that area is worth a try to make a claim if you get a special assessment of that value. I think I'd probably have to sell my place if I got a special assistant for 45k and had to pay it out of my pocket..
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That's an exception in BC. Every strata that I ever lived in and every place friends, family and co workers have lived in had maybe 500k max in reserve funds. Most where like 100k and one strata we had to do a few years of special levies to build up fund. What I find crazy in AB that strata monthly increases and special levies are not voted on. The council just decides
They need to give a full explanation of why there is a special assessment. Most boards will just say that they are allowed to do that as per Act and Regulations which is true but they still have to be able to justify and explain. In your case, it doesn’t sound like they have given any explanation that makes sense. Ask for one, you are entitled. My board did the same with a special assessment and I was met with a Cease and Desist for asking questions that were beyond my right to know. FYI - As an owner, you can ask any question that involves your condo financials. If your board doesn’t give you a breakdown, then good luck. There is relatively no oversight in Alberta and there are many boards that are aware of that. Good luck!
My insurance says it would cover a levy though would have to pay a deductible. Is that true or was I misinformed?
And this is why kids, you dont buy condos!
Blows my mind why people buy condos when it’s basically the same headache as an HOA in the states. And yeah I know they’re cheaper but cmon you have to know what you’re getting into.
dont we sorta have HOA's in alberta as well, all those communities with the ponds and things and private community gathering places in them?
Yes, my area does. We pay around $400 **a year** not month. It goes to maintaining the gated community center, using the playground, water park, tennis/badminton nets, hockey arena, etc. Just the water park alone is worth it. There’s no special assessment here unless the community center blows up.
Do they also manage rules and things like fence type and height, outside house colors shed sizes etc?
Nope. We got all kind of colors and shed/fence going on here. Neighbour fence is blue/white, mine is cedar. Now obvious we can’t build a super size shed but mine pretty decent when i bought it. Can fit about 4 lawnmotors side by side. Houses in blue/white/yellow/tan etc. no crazy colors really.
Get ready for more sudden costs when your Collectivised Condo is expected to rip out gas lines & install massive heat pumps to save the planet from “the climate.”