The truth about buying a condo

Downtown living. Here, Waterfront Drive.By Tania Moffat

While home sales may still be dominated by single family homes, condominium sales are growing in popularity. “Condo sales in 2013 were up thirteen per cent over 2012, representing one out of every five home sales,” says Peter Squire, WinnipegRealtors market analyst and director of public affairs. “We had 1,759 condominium sales in 2013, the highest annual total we have achieved in our 110- year history.”
The market shift
Condos offer consumers a more affordable type of home ownership. “Last year, thirty-two per cent of total sales fell into the $150,000 to $199,000 range, and sixty-five per cent comprised condo sales under $250,000. Winnipeg is also adding more inventory,” Squire explains. “New builds and conversions have helped to add affordable properties to the market and increase condo sales over the last few years.”
David Powell, president of WinnipegRealtors, explains that the condominium market in Winnipeg is continuously developing and will continue to grow. “Choice is the nice thing about where Winnipeg is at now. In the 1990s there were not a lot of condos being developed. Between 2000 and 2004, we began to see some developments, but since then our needs have changed. Now we are playing a game of catchup with condo development in the city.”
“The growth of the market has led to a large diversity of properties from base conversion one bedroom properties selling for $150,000 to million-dollar bungalow stand-alone condominium properties. This diversity in style and price also contribute to good resale, as the market is not oversaturated with the same product,” says Powell.
Sales have been highest in the south, southeast, and southwest corners of the city in developments such as Waverley West, Tuxedo, and River Park South. The large number of products on the market in these areas contribute to its high sales.
Downtown sales are also strong and increased investment in this area over the last eight years has led to more residential projects in the core. Proposed projects like D Condo, One Portage & Main and Glasshouse Lofts are counting on this continued trend. All this is good news for Winnipeg as we need to increase densification of the city and provide more multi-family residences, apartments, and condos.
The benefits of owning a condo
Choosing whether or not to buy a condominium has a lot to do with lifestyle. Do you relish the thought of never having to shovel snow, mow the lawn or fix the roof? Condos provide owners with freedom from maintenance, a sense of community and security, and often amenities that they may not have been able to afford otherwise, such as a gym or pool. New projects in the city are considering these lifestyle factors in their designs including amenities such as rooftop terraces, recreation rooms, and senior services.
These luxuries are not included for free; they are incorporated into the monthly condo fees. “Condo fees vary based on the size of the condo, style, project size, and really depend on the services that are provided by the developers – utilities, amenities, landscaping, common-area fees, reserve fund contributions, parking stalls and more. These factors are all reflected in the condo fees,” explains Powell. “Townhouse condos generally have lower fees because they have separate utilities and no recreation facilities, whereas large projects with large common areas or older buildings in need of more maintenance will have higher fees.”
Reserve funds, part of monthly condo fees, are paid into by each person who owns a unit in the condo building. The purpose of the fund is to cover non-routine operating costs and renovations as the building ages, like carpet replacement and roofing. The decision as to the amount paid per month and how much is kept in the fund varies widely, and should also be investigated by interested buyers.
Condominium sales require considerably more documentation than typical home sales. Powell recommends that interested buyers, especially first-time buyers, use a real estate agent. “When we talk of pitfalls of buying condominiums, it is usually regarding buyers not being knowledgeable about the complete process and Realtors can help with this.”
Realtors are able to investigate the corporation to determine if it has any legal or insurance claims. They can research your condo fees, your unit’s boundaries, the current amount of the reserve fund, and if any special assessments are planned – all the finite details that the buyer may not find easily accessible.
Condo owners are still responsible for property taxes, contents insurance, utilities not covered in their monthly fees, optional amenities such as parking or additional storage, repairs within their unit, and of course mortgage payments. Monthly fees may seem frightening but buyers should consider that home owners still need to pay for utilities and insurance, and are solely responsible for upkeep, repairs and maintenance. Add to that the cost of purchasing the tools or services needed to maintain their homes and the financial playing field starts to level out.
Ultimately, it comes down to your lifestyle. Homeowners have more freedom in terms of decision-making, pets, design, and privacy, whereas condo owners have less privacy, must share in decision-making processes, and follow rules and regulations.
Is privacy important or do you want to live within a secure community? Buyers need to decide what aspects of home ownership are most important to them before making a choice.

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