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Posts from the ‘Strata Mondays’ Category

Strata Mondays #7 – Fractional Ownership vs Timeshare

In my continuing series about strata property, Strata Mondays, I answer a different question about condos, townhouses and other strata property in Victoria, Sooke, and British Columbia. Make sure you subscribe via RSS or E-mail to get each new post.

Sooke Harbour Resort and Marina - Fractional Ownership Available

Sooke Harbour Resort and Marina - Fractional Ownership Available

Q. What’s the difference between fractional ownership and timeshare?

A. When most people think of timeshares, they immediately conjure up images of being hauled into a room full of other unsuspecting tourists for a 90-minute hard-sell presentation in exchange for a free dinner or some other activity. Timeshares are popular in many resort destinations around the world, giving people an option to stay in a resort property for several days out of the year. With timeshare, you don’t actually own anything other than a right to occupy the property. Selling a timeshare can be difficult, and prices may not be related to the general market price of similar properties. Rules for selling timeshares are different than that of selling real estate, so engaging a real estate agent to market the timeshare may be impossible.

Fractional ownership is just that. You own a fraction of the property, independent of and along with other owners. Unlike timeshare, your name is registered on title, and you can freely sell your property just like any other piece of real estate in British Columbia. For recreational property, this makes great sense, since you’ll likely only use the property a few weeks out of the year. Why pay the big price and then have it sit empty the rest of the year?

Use of the property is governed by an  agreement between the owners which specifies which owners will have use of the property for which weeks of the year. Often, there is a rotation system in place, which ensures that no single owner will have exclusive rights to the peak season weeks. There is typically a management company and staff on site to handle the upkeep and maintenance of the property on behalf of the owners. In many cases, you can rent out your property if you won’t use all of the weeks of your share.

As with any real estate purchase, it would be well worth your while to engage an experienced REALTOR® to guide you through the process, as well as having a qualified real estate lawyer go over the legal details of the fractional ownership arrangement.

I currently hold the listing for a full ownership unit at Sooke Harbour Resort and Marina – and can also arrange quarter and eighth shares, too.

If you have any questions about strata property that you’d like me to answer, call me at 250-885-0512, send me an email at tim@timayres.ca or fill in my contact form. I’d be happy to help!

Tim Ayres – Sooke Real Estate Professional

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Strata Mondays #6 – Leaky Condos Part III

In my continuing series about strata property, Strata Mondays, I answer a different question about condos, townhouses and other strata property in Victoria, Sooke, and British Columbia. Make sure you subscribe via RSS or E-mail to get each new post.

A building awaits new landscaping after membrane replacement.

A building awaits new landscaping after membrane replacement.

Q. I’m considering buying a condo in an older building here in Victoria, BC – it was built in 1978. Do I need to be worried about leaky condos and expensive repairs?

[Read Part I of this post here, and Part II here.]

A. Yes and no. While older condos built in the ’70s and ’80s are not usually subject to the systemic problems that caused premature building envelope failure, there are still things you need to know. First, “leaky condos” were caused by premature building envelope failure – with an older building there might be problems with the building envelope related to its age, necessitating a renewal project. Hopefully, over the life of the building, the strata corporation has been doing the necessary preventative maintenance.

Increasingly common with buildings of this era are problems with the underground parking garage. Leaks develop and water slowly trickles down through the suspended slab of the parkade roof and into the garage. You might wonder what the big deal is; there are always drains and no one lives down there. But over time, if left uncorrected, the water will corrode the reinforcing steel embedded in the concrete, causing concrete decay and eventual structural damage – and the condo building is built upon the garage, after all.

The footprint of the building is smaller than the footprint of the parking garage, like this:

Finally, a use for MS Paint.

Finally, a use for MS Paint.

When the building was constructed, the parking garage was built first, and then the foundation of the building on top of the suspended slab roof of the parking garage. To prevent water leakage, a waterproofing membrane was attached to the sides of the building and over the top of the parking garage. On top of the membrane, the finishing landscaping and walkways, etc, were placed:

No, I didn't even TRY to draw a car.

No, I didn't even TRY to draw a car.

Over time, depending on the quality of the membrane originally installed, leaks will develop. Roots from trees could penetrate the membrane, there could have been small holes when it was originally installed, or it could just be breaking down after so long. The only real solution to the problem is to replace the membrane. The only way to do this is to dig up all the landscaping and other surface finishing, tear off the old membrane, replace it and then re-finish the landscaping. As you can imagine, this is not cheap – it’s not like you can re-use the  the excavated trees, concrete, and dirt – there’s no room on the property. It all has to be trucked away, and then new landscaping trucked in. I know of one building in Victoria whose residents had to shell out $20,000-$30,000 to have this done.

There are cheaper “solutions” sometimes floated by strata councils who don’t want to bite the bullet and replace the membrane. If the source of the leak can be identified, the area can be excavated, and the membrane patched. However, this is a temporary solution that may or may not work, and it will only prolong the inevitable, pushing up the cost when there are no more patches to do.

So, as a condo buyer, you should carefully examine the strata council minutes and find out if parkade waterproofing is an issue. If there has been an engineer’s report in the last few years you should carefully examine it. If there is no evidence in the strata records, you should specifically as your property inspector to have a look at the underground parking for potential leaks. You could also ask your REALTOR® if he or she knows whether or not the parking waterproofing has been replaced.

Tim Ayres – Sooke Real Estate Professional

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Strata Mondays #5 – Leaky Condos Part II

In my continuing series about strata property, Strata Mondays, I answer a different question about condos, townhouses and other strata property in Victoria, Sooke, and British Columbia. Make sure you subscribe via RSS or E-mail to get each new post.

A leaky condo undergoing repairs

A leaky condo undergoing repairs

Q. I’ve heard that most of the systemic problems that caused the leaky condo crisis in the 90’s have been fixed. What’s changed since 1999? Are there still leaky condos being built?

A. [Read Part I of this post here] Changes in building design and technology and the building code have come into effect since the end of the 1990’s. Instead of thinking of the building as one system that needs to be sealed up to prevent air loss and thus reduce energy costs, we now consider two separate systems: the exterior wall and the building envelope. The building envelope includes the roof and exterior cladding. Building codes now require an airspace between the exterior cladding (such as hardi-plank siding or stucco) and the exterior wall (covered by a water-tight membrane like building paper or Tyvek®). The idea is to allow airflow in behind the cladding to dry out  any accumulated moisture, while at the same time creating a means by which any wind-driven rain can drain out via gravity. See below:

You may hear the term "Rainscreen" in new or remediated buildings.

You may hear the term "Rainscreen" in new or remediated buildings.

It should be noted that you can’t blame the leaky condo crisis in BC entirely on the building code. It has been discovered in many court cases regarding leaky buildings that the exteriors of some buildings were not built to the code that was in place at the time. However, it certainly was a contributing factor.

Many of the leaky buildings built during the leaky condo era have been remediated at great expense to the owners. Typically they now employ some sort of rainscreen construction as detailed above. Most will be without problems, as long as a regular maintenance programme is put into place and followed. In fact, the warranty that comes along with a remediation is usually contingent upon a proper maintenance schedule.

When shopping with a REALTOR® for condos, especially those built in the 1990s, you should ask whether or not the building has undergone remediation, and inspect all documents that lead up to the work being done, including the engineer’s report. There are some buildings in Victoria and vicinity that have not been remediated, but instead opted for a “preventative maintenance” programme that will end up costing them more money in the end.

In British Columbia, anything built with a building permit filed after July 1, 1999 must come with a ten year new home warranty. Usually these come in a 2-5-10 or 2-10-10 format: 2 years materials and labour on the home – this would cover things like nail pops, cabinetry, and other deficiencies. 5 or 10 years on the building envelope system, the exterior cladding and weather barrier of the home, and 10 years on the major structural components of the home.

What about condos built these days? Do they still leak? Hard to say. I’d tend to reason that if there was still widespread and systemic premature building envelope failures happening in modern construction, we’d be hearing a lot more about it on the news. I’m sure there are probably a few recently built buildings where there has been water ingress issues, but nowhere near the magnitude experienced last decade.

Check back next Monday for Part III, when we’ll talk about another type of leaky condo you don’t always hear about!

Tim Ayres – Sooke Real Estate Professional

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Strata Mondays #4 – Leaky Condos Part I

In my continuing series about strata property, Strata Mondays, I answer a different question about condos, townhouses and other strata property in Victoria, Sooke, and British Columbia. Make sure you subscribe via RSS or E-mail to get each new post.

Leaky Condo being repaired

Leaky Condo being repaired

Q. I’ve heard the term “Leaky Condo” from my friends and family, and that I should avoid buying one. What is a leaky condo?
A. Put simply, a leaky condo is an attached strata unit (condominium or townhouse) that suffers grossly premature building envelope failure (water ingress/leaks) that causes major damage to the exterior and sometimes interior of the building. The end result is extremely costly repairs, some of which have yet to be carried out today, 10 years after the end of the”leaky condo era.”

The leaky condo crisis emerged in the late 1980s through the 1990s in coastal British Columbia as a result of two major factors. First, the design craze of the time was Californian style architecture. Second, new rules in the building code required builders to seal up exterior walls, in an attempt to increase energy efficiency.

In Coastal B.C. it rains a lot. California-style architecture is mostly stucco buildings with flat roofs, and little or no overhang from the top of the roof over the walls. If you look at most traditional buildings in Vancouver and Victoria, you’d find pitched roofs and/or good overhangs over the top of the exterior walls.

The new building code required builders to seal up the buildings to keep air out, to increase energy efficiency. The problem is that by doing this, water can still seep in. Without adequate ventilation to dry out the moisture, the wooden exterior wall starts to rot. Balconies were often worse – water would seep in and rot the support beams creating a safety hazard.

Rotten balcony supports

Rotten balcony supports

Often, the only real solution was complete building envelope replacement. This involved tearing off the entire face of the building, replacing most of the plywood sheathing, properly weather screening it, and replacing the exterior cladding with something more suitable to the design of the building and the climate in which it stands. This is extremely expensive, and it’s not unheard of to hear of owners having to shell out $30,000-$50,000 or even more in special assessments to get it right. Some stratas were able to successfully sue the developers and recover some of the money they paid, but many were on the hook for the repairs. But most of these buildings had warranties, right? Well, many did, but unfortunately the unraveling of the leaky condo crisis caused most of the home warranty outfits to disappear into bankruptcy, further leaving owners in the lurch.

Check back next Monday for Part II, when we’ll cover what’s changed since 1999.

Tim Ayres – Sooke Real Estate Professional

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Strata Mondays #3 – Maintenance Responsibilities

In my continuing series about strata property, Strata Mondays, I answer a different question about condos, townhouses and other strata property in Victoria, Sooke, and British Columbia. Make sure you subscribe via RSS or E-mail to get each new post.

Spiderman Survives the Recession

Spiderman Survives the Recession

Q. Who is responsible for the exterior maintenance of a strata complex (including washing windows)?

A. The easy answer here is it depends, but usually it’s the strata corporation who is in charge of the exterior maintenance of a strata complex like a condominium or townhouse.

When you own a condo or townhouse, you own the strata lot and a share of the common property of the strata corporation. Your strata lot is basically everything inside the walls of your unit and sometimes a parking space and/or storage locker. The common property is the strata building itself including the roof, windows, balconies, exterior walls, driveways, landscaping, hallways, elevators, and so on. Everyone pays strata fees, the amounts proportional to the size of their strata lot, which are used to insure, maintain and repair the common property.

The BC Strata Property Act, Part 2, Section 3 says:

Responsibilities of strata corporation

3 Except as otherwise provided in this Act, the strata corporation is responsible for managing and maintaining the common property and common assets of the strata corporation for the benefit of the owners.

Usually this means that the strata corporation would be responsible for paying to have the exterior of the building cleaned and the windows washed. Most responsible complexes have this done a couple of times a year. However, sometimes there are bylaws in place that place the duty to maintain the exterior of the strata buildings on the shoulders of the individual owners. A good example of this would be a detached townhouse complex where each owner would be responsible for replacing his or her own roof, since it only directly benefits that owner.

Part 5, Division 1, Section 72 of the BC Strata Property Act says: (emphasis mine)

Repair of property

72 (1) Subject to subsection (2), the strata corporation must repair and maintain common property and common assets.
(2) The strata corporation may, by bylaw, make an owner responsible for the repair and maintenance of

(a) limited common property that the owner has a right to use, or
(b) common property other than limited common property only if identified in the regulations and subject to prescribed restrictions.

(3) The strata corporation may, by bylaw, take responsibility for the repair and maintenance of specified portions of a strata lot.

The Strata Property Act Standard Bylaws say: (emphasis mine)

Repair and maintenance of property by owner

2 (1) An owner must repair and maintain the owner’s strata lot, except for repair and maintenance that is the responsibility of the strata corporation under these bylaws

(2) An owner who has the use of limited common property must repair and maintain it, except for repair and maintenance that is the responsibility of the strata corporation under these bylaws.

and;

Repair and maintenance of property by strata corporation

8 The strata corporation must repair and maintain all of the following:

(a) common assets of the strata corporation;
(b) common property that has not been designated as limited common property;
(c) limited common property, but the duty to repair and maintain it is restricted to

(i)  repair and maintenance that in the ordinary course of events occurs less often than once a year, and
(ii)  the following, no matter how often the repair or maintenance ordinarily occurs:

(A)  the structure of a building;
(B)  the exterior of a building;
(C)  chimneys, stairs, balconies and other things attached to the exterior of a building;
(D)  doors, windows and skylights on the exterior of a building or that front on the common property;
(E)  fences, railings and similar structures that enclose patios, balconies and yards;

(d) a strata lot in a strata plan that is not a bare land strata plan, but the duty to repair and maintain it is restricted to

(i)  the structure of a building,
(ii)  the exterior of a building,
(iii)  chimneys, stairs, balconies and other things attached to the exterior of a building,
(iv)  doors, windows and skylights on the exterior of a building or that front on the common property,
(v)  fences, railings and similar structures that enclose patios, balconies and yards.

So, while the standard bylaws and the Act say that it’s the strata corporation’s responsibility for exterior maintenance,  it’s possible that your strata complex may have enacted a bylaw that requires the owners to wash their own windows, maintain their own landscaping, or perform other exterior maintenance. To be sure, you’ll have to read your strata corporation bylaws carefully.

If you have a question about strata property, or any other real estate matter, please e-mail me at Tim@TimAyres.ca or fill in my contact form. I can also be reached by phone at 250-885-0512

Tim Ayres – Sooke Real Estate Professional

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Strata Mondays #2 – Which floor is worth more?

A large patio is one reason ground level condos are more expensive

A large patio is one reason ground level condos are more expensive

In my continuing series about strata property, Strata Mondays, I answer a different question about condos, townhouses and other strata property in Victoria, Sooke, and British Columbia. Make sure you subscribe via RSS or E-mail to get each new post!

Q. I was looking at a new condominium project and I noticed that the same floor plan was available on all four floors, but the top and ground level were more expensive. Top floor I understand, but why would somebody pay more for a ground level suite?

A. This is very common – all other things equal, the top and ground floors of a condominium building will typically see higher sale prices per square foot. Most people can understand why somebody would pay more for a top-floor condo. A better view, and no noisy neighbours from above are a couple of reasons. Top-floor condos also often have extra-high ceilings or even lofts, skylights, and so on.

But when many people think of ground-level suites, the immediate concern is always security. Being ground level, an undesirable doesn’t have to break in the front door or scale the outside of the building to break in. Some ground level suites are also somewhat below grade, so lack of light can be a concern.

However, there are also significant advantages to a ground level suite. You may see the term garden-level suite, which as the name suggests, emphasizes one of theses advantages. Ground or garden-level suites often come with extra large patios and sometimes even a fenced courtyard. Lack of outdoor space is one of the biggest drawbacks to condo living. It’s possible to have a thriving, lush, beautiful garden with a large patio perfect for entertaining with a ground-level suite. This also enables you to walk up to your home and enter through the patio door if you desire.

Another advantage is that being on the ground level, you won’t have any neighbours below you to disturb, so you can probably install hard surface flooring such as wood or tile. It’s not uncommon for strata councils to have by-laws in place to prohibit units above the ground floor from having hard surface floors, since noise is more easily transmitted to the unit below.

So, it’s for all these reasons that ground-level suites are often more expensive than similar-sized ones on the between floors in low-rise buildings. High-rise buildings would be a different story – with prices increasing as you go higher in the building.

If you have a question about strata property, or any other real estate matter, please e-mail me at Tim@TimAyres.ca. I can also be reached by phone at 250-885-0512

Tim Ayres – Sooke Real Estate Professional

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Strata Mondays #1: Bare Land Stratas

bareland-strata

Inspired by my most recent First-Time-Buyer Friday post, I have decided to dedicate a new tag on this blog to covering strata issues. So, without further ado, we have the first weekly, but much less alliterative, Strata Mondays.

Q. When searching Realtor.ca the other day, I saw a property listed as a bare land strata. What’s that all about?

A bare land strata is a type of strata corporation where instead of a large building being divided up into strata lots (condos or townhouses) to facilitate individual ownership of the units, a large tract of land is divided up into strata lots. In this case, the strata lot is quite literally, a vacant lot.

Bare land stratas are quite common in semi-rural areas where all lots in a subdivision will share a common sewage treatment system, allowing the developer to subdivide the large tract into smaller lots this is because by sharing, each individual house does not need to have its own septic field, which takes up considerable amounts of room. Often, this is the sole reason for the strata, and as such, fees are generally very low, covering only things like maintenance and operation of the septic system, and insurance for the common property.

Common property, which is shared proportionally by all owners in the strata, is usually the septic field and/or its equipment, the road or shared driveway, and often some visitor parking areas.

Bareland stratas are usually much more casual than other strata corporations. Meetings are held informally and very infrequently. Often there is just a president and a treasurer that handle the corporation’s business, rather than a full strata council. By-laws are usually just the standard-form bylaws prescribed under the Strata Property Act. This can be both good and bad. Because they are so relaxed, you usually need not worry about being told what to do with your property or being constantly reminded of by-laws and worrying about infractions. However, this can also be taken advantage of by a bad neighbour or tenant who moves into and disrupts the neighbourhood by, say, parking a humongous boat, 2 other vehicles and a bunch of other junk on his or her front lawn. If the strata doesn’t have any by-laws about this, it may be forced to create some.

If you’re buying into a bare land strata, you should know that it’s very likely that there won’t be extensive financial records, by-laws, meeting minutes, and other documents you’d expect to find if you bought a townhouse or condo. A bank statement showing the amount in the strata account is often the extent of it.

One thing you should be aware of is whether or not the strata corporation owns the land upon which its sewage treatment system sits. Sometimes, this often sizable parcel is owned by the strata. In this case, if and when municipal sewers are extended to the strata and the sewage plant becomes redundant, the strata corporation can sell the land and equipment and the proceeds are then split among the owners. However, sometimes the strata is merely granted an easement or license to operate the septic system until such time as it becomes redundant. In this case, the strata can sell the equipment, but the land is up to the owner (often, the developer that built the subdivision).

Tim Ayres – Sooke Real Estate Professional

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