The hidden cost of low condo fees.

Shopping for a condo? You might not want to go for the one with the cheapest strata fees:

“This is a coming crisis that nobody is talking about,” said Chris Jaglowitz, a lawyer who specializes in condo law for Gardiner Miller Arnold LLP and a member of the Condominium Managers of Ontario. “You have all of these older buildings, and someone needs to pay for long-neglected repairs. And many people won’t be able to cover their share.”

That’s because condo buildings are owned collectively by the residents, and all repair bills are shared equally. Condo boards are able to levy special assessments in addition to condo fees to pay for projects. But the boards are made up of residents, who are sometimes motivated to keep fees low. And they serve short terms, which means long-term planning is often difficult.

Check out the full article in the Globe and Mail.

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Marcello
Marcello
9 years ago

Our strata (Europa) has come under some derision on this blog for our high strata fees. To no avail I've argued that's in part due to our active (and long serving Council) actually looking and what needs to be maintained and fixed and actually DOING it which costs money (it's also partly due to heat and A/C being bundled into the fees). I've always maintained that all those stratas out there with low fees are in for a *world* of hurt when things start to fall apart, cuz like the Hip say "When it starts to fall apart, man it really falls apart". BUT buyers don't seem to give a rat's behind about any of that. All we hear is "your fees are too high" and prices get depressed accordingly. So there is HUGE incentive for stratas to low-ball their… Read more »

MM
MM
9 years ago

once long term contingency fund engineering studies become mandatory for stratas, expect a whole lot of deferred maintenance to come to light … and greatly affect prices

Anonymous
Anonymous
9 years ago

Did some digging, found the original article Garth is taking about… Now I've heard it all:

"I have seen these ups and downs before. What's happening in Abbotsford and Mission now is you have a buyer's market," he said.

"It's not a trend. If you have three, four, or five months of going down then we would look at it. There could be various reasons for this."

One of the reasons, Sidhu said, may have been the recently concluded federal election.

Hovering
Hovering
9 years ago

good video at greatfool tonight too

"sell everything"

Ravishing Rick
Ravishing Rick
9 years ago

Bask in my glory people – bask I tell you!

In fact, as the local paper reported days ago: “Realtors in the Fraser Valley are warning people in Abbotsford and Mission not to panic after property sales in the two communities dropped substantially in April.”

http://www.greaterfool.ca/

Garth is my wing man… psych… I don't need one fool!

Hit the music!

Vansanity
Vansanity
9 years ago

@paulb.: Hi Paul, could you post teh total inventory figure as well? Last I recall it was just over 15,000. Thanks!!

Runawayscreaming
Runawayscreaming
9 years ago

That is indeed an excellent interview of Ladner by Berner:

http://www.youtube.com/watch?v=Z5SAgli5Yww

Peter Ladner is very conservative and extremely diplomatic for my tastes but he is a straight up non-bullshitting Vancouverite with no personal interest whatsoever in curbing speculation. It is truly remarkable that a guy like Peter is discussing the effects of wealthy environmental refugees from China on the quality of life in Vancouver. That indicates to me (if it was not already obvious) that you people in Vancouver have a very serious problem.

Peter is not exaggerating when he says PRC "investors" are driving business out of Vancouver. That is what's happening.

paulb.
paulb.
9 years ago

New Listings 301

Price Changes 108

Sold Listings 146

Anonymous
Anonymous
9 years ago

I watched Global news for the first time in years 2nite and I quickly recalled why I never watch Canadian news. Big piece on how the Chinese are buying up West Van, blah, blah, blah. Well, at least I've learned my lesson for good this time.

Best place on meth
Best place on meth
9 years ago

@sore loser:

Fixed.

The Chinese RE Investors are like locusts. They come, use up the resources available and leave when there’s nothing for them to gain anymore.

southseacompany
southseacompany
9 years ago

Peter Ladner – Restrictions on Foreign Ownership

http://www.youtube.com/watch?v=Z5SAgli5Yww

Interesting conversation with Peter Ladner on effects of high prices in Van, restrictions on foriegn demand, etc.

Anonymouse
Anonymouse
9 years ago

@granite countertop:

I don't think commodities are rising due to shortage of supply, it's because they're priced in USD.

Anonymous
Anonymous
9 years ago

If there are 'no bears left to capitulate', doesn't that mean there's nobody left to buy?

That makes me the most valuable commodity in the lower mainland – a buyer. Wait, is that my phone ringing? "Hello Bob, no thanks, 70% off isn't low enough. See ay, wouldn't want to be ya." Click.

Bear Vancouverite
Bear Vancouverite
9 years ago

@Narnia – now that I think about it, I assume you meant a big correction, so please ignore my comment ;). Most people referring to the "big one" in reference to Richmond usually only mean the one thing.

Bear Vancouverite
Bear Vancouverite
9 years ago

@Narnia #23 "I just hope we get the big one to get rid of those locust investors."

So you're hoping for a natural disaster to hurt/kill thousands of people so that housing prices will go down and you can buy? Given that some of these "locusts" aren't even living here and have been selling/renting to locals and foreign students, your "hope" is basically to see many fellow Canadians (newly immigrated or not) potentially suffer horrible fates like dead friends and family.

Here's what I'm hoping for: a major correction so honest, hardworking Canadians can afford to buy their own place without slaving themselves to untenable mortgage debt, with greedy investors taking the brunt of the financial hit.

Devore
Devore
9 years ago

@granite countertop: The chart's range already slopes up, due to inflation, increased demand and higher exploration and extraction costs. Doesn't mean there will not be a pullback. For demand to keep increasing, there must be real economic growth. Remember, bubbles aren't restricted to real estate, it's not suddenly different in other areas. Why should housing crash but copper keep going up?

Narnia
Narnia
9 years ago

When I think, “what real industry is there in Vancouver?” I count the mining companies, thankful there’s at least that

________

Lol – Vancouver is the JUNIOR mining capital of the world. It is the world of pure speculation, penny stocks, and Securities Commission investigations.

Funny how Vancouver's greatest economic driver, apart from RE, is linked to pure speculation as well. Any wonder why there is so much speculation in RE?

The 20% drop in prices in West Vancouver in 2008 was linked in part to the shelacking the Vancouver brokers and miners took with the collapse of the TSX.

granite countertop
granite countertop
9 years ago

@coitus interruptus?: I actually expect commodities to continue rising. God's not making more resources magically appear in easy-to-access locations, and there's more and more people in the developing world demanding a reasonable standard of living.

When I think, "what real industry is there in Vancouver?" I count the mining companies, thankful there's at least that.

patriotz
9 years ago

@coitus interruptus?:

What's really incredible is that with record high commodity prices Canada is running both a trade deficit and a current account deficit. Per capita our current account deficit is as bad as the US's.

So what's really driving the "recovery"? Not hard to figure out.

http://www.economist.com/node/18713776?story_id=1

coitus interruptus?
coitus interruptus?
9 years ago

Took me a while but i found the source of that chart, case anyone was curious

http://www.nowandfutures.com/images/crb_1900on.pn

Anonymouse
Anonymouse
9 years ago

@granite countertop:

"When there was a condo like this, poor condition, needing repairs, what happened to it in the past?"

I remember in the past seeing cheap condos in two buildings on Drake – one at the interesection with Pacific, and the other at Hornby. The former just had its scaffolding removed, the latter just had it put up. Each was significantly below comparably units in "good" buildings. I think what usually happens is that the seller drops the price so that price+repairs is about right, minus a bit to account for the risk involved.

Without knowing what the repairs are likely to cost it's impossible to say whether their $120K asking price represents a good deal or not, even if you were willing to take on that amount of risk.

granite countertop
granite countertop
9 years ago

@Anonymouse: Thanks for looking that up, I suspected "Future assessment for building is unknown" was code for "OMG it leaks you'll be paying through the nose".

This is an anomalously bad condo, to be sure. I was just amazed to see *anything* on MLS in Vancouver (other than hotel shares) for $123k. I'd been looking for cheap stuff, although not as much in the past 8 months or so. When there was a condo like this, poor condition, needing repairs, what happened to it in the past? Did the owners hold on to it in the hopes of selling higher after the repairs? Did some speculator scoop it up thinking they're getting a bargain at a price much higher than this? Neither of these things are happening in this case, I think it represents a shift.

coitus interruptus?
coitus interruptus?
9 years ago

I think Canada has become too dependent on the credit-fuelled intercourse between property and commodities. The list of mining companies headquartered in Vancouver alone, is long.

From the chart below, it looks as though we‘re in the final stages of a 30 year cycle. Where the commodity index squirms from here is of vital importance to much of Canada.

http://i51.tinypic.com/2r551r5.jpg

Li Kai Shing
Li Kai Shing
9 years ago

hi

Anonymouse
Anonymouse
9 years ago

@patriotz:

"Future assessments for all condos are unknown."

I agree they chose their words badly, but it's still clear that this is an exceptional case and not any sort of milestone.