Buying a condo, or any property, comes with a lot of doubts. We’ve taken the time to answer some of the most common questions we get asked.
BUYING A CONDO BY WAY OF ASSIGNMENT
Most people who buy a condo take ownership through the Land Registry System. Just before the day of closing, you transfer money to your lawyer and if you need additional funds via a mortgage, your lawyer will register your ownership of the property and the interest of the mortgage lender.
An Assignment means that you are buying a ‘right’ to own a condo that is not in the Land Registry System. Usually the condo has not been built or it is not ready for occupancy and the building has not been registered. This ‘right’ is just a paper transaction and not the transfer of the actual property. The closing of the Assignment occurs BEFORE the condo is registered. The individual who buys the ‘right’ will eventually close and register their ownership of the condo at some later date.
The number of Assignment transactions is growing rapidly. For sellers who bought a new condo from plans several years earlier and whose plans have changed, this is an opportunity to sell before they have to get a mortgage and incur additional closing costs such as that dreaded, double Land Transfer Tax. For buyers who want a brand new condo without having to wait years for construction to finish, or who can not find what they want in the resale market, it represents a lot more choice. Most Assignments are sold on an ‘Exclusive’ basis. They are also more complicated than a regular sale because a mortgage can not be obtained on the closing of the Assignment, and will need to be postponed until the day of registration. Other issues such as occupancy, reimbursement of the seller’s deposits and more must be taken into account.
You need a Realtor that is trained in finding and drawing up the Offer for Assignments. So if you want to buy or sell an Assignment then you have come to the right web site! We also have the best trained Realtors with the most expertise in Assignments!
The Status Certificate provides basic and essential information concerning the financial status of a unit and of the condo corporation.”How much is in the reserve fund and is it sufficient for the immediate future? What did the engineering report say? How many units are rented in this buidling? Is there a claim against the current unit owner?” A Status Certificate answers all of these questions and more, it is your protection against the unknown.When purchasing a resale condo unit, you should ensure that your offer is conditional on receiving and reviewing a Status Certificate and the accompanying documents, as required by the Ontario Condo Act. The certificate is the resale equivalent of a disclosure statement and you must review all the material that comes with the certificate to ensure that you are satisfied that both the condo unit and the condo corporation are suitable for you.
This certificate, for which there is a fee of $100 inclusive of GST, must be delivered within 10 days of the request for it. It discloses whether the owner of the unit you are buying is current in the payment of common expenses as well as a picture of the condo corporation’s financial affairs. It is to be delivered with the documents, which govern the condo corporation but are not attached. Once the list of agreements is reviewed, you or your lawyer may also wish copies of some or all o them for review. There can be an extra charge for these documents
Original condos were developed as a cheaper form of housing. Instead of having to buy the land and the building, people could own their building/unit and share the land cost.It then makes private ownership possible in areas where land values would ordinarily make this too expensive i.e. living downtown Toronto.
People buy condos as much for ‘Lifestyle’ as they do for price. In downtown you can buy condos for over one million dollars quite easily.
Condo ownership also eliminates some of the problems of upkeep and maintenance often associated with home ownership, since the cost of maintenance is shared and is usually the responsibility of the Condo Corporation through its property management (Lifestyle). For older people, condos represent an attractive ownership alternative when they spend extended periods away from their property.