Additional tips when purchasing a Condo

Some final points of advice when looking to purchase in a Multi-Family building


1) Like mentioned in the Vancouver Courier articles (Condo Pitfalls & Condo Nightmares) that inspired these blog entries, any lack of documentation is an automatic Red Flag! If the building is more than 4 years old, and does not have a extensive building envelope review completed in the last 5 years, you should think twice about continuing with the purchase.

Fortunately the lack of report should become a rarer situation going forward now that Bill 8 of the Strata Property Act has been enacted requiring all Strata’s in BC to commission a ’depreciation report’ within the next 2 years.

Note: On a side comment, it is important for Condo owners to realize that the implementation of these studies will most likely culminate in significant Strata Fee hikes as the full cost of maintaining a multi-family-building is better understood by Strata’s.

2) Never allow yourself to be pressured into a purchase. Subject removal dates are arbitrarily defined periods of time with no relation to a logical time period required to properly vet your purchase. They often can represent hype the agents impart into the process to make purchasers feel they need to ‘act fast’ or loose their buying opportunity. This is far too big of a decision, with far too large a potential liability, to be rushed into without due diligence. Take the time to due it right. If it falls through, it probably is for the best. Any vendor who is seriously interested in selling will ensure the buyer has ample time to vet the purchase as they do not want the buyer coming at them later. In markets where there is a buying frenzy, do not be pressured to buy without subjects, you are already buying at what is often the top of the market and can usually ill afford to take on the additional responsibility of unknown liability.

3) At the lower end of the liability scale is a fully rain-screened dwelling. In general, these buildings are more tolerable of faults in the design of the primary water shedding surface and will usually represent a much lower level of potential liability. At the upper end of the liability scale is a face-sealed stucco building without any significant overhangs and a complicated exterior design with lots of penetrations and architectural ‘features’. For a discussion on these two exterior styles see this HPO bulletin.

4) Remember that just because a building is not leaking now does not mean it will not leak down the road. There is a reason that a face sealed building is no longer allowed by code. It does not work! It is usually not a matter of if problems will develop but a matter of when. There is also the issue where many older buildings (pre-1990) are now looking at energy upgrades to the building to reduce the cost of heating bills as energy costs rise. This is often having a negative and unanticipated impact on the building’s health because as more and more of the interior heat is blocked from reaching the exterior sheathing and cladding, that wall assembly’s ability to survive infrequent wetting is substantially reduced. So as the general housing stock is updated to be more energy efficient, it will be increasing more important to ensure that the walls have a continuous water shedding capability.

I hope these entries have helped. I would be happy to discuss these issues further with you at any time. As some final guidance for you, when purchasing a Condo, I recommend you review this bulletin I send all my Condo clients as part of my inspection process.

Property Disclosure Statements

Global TV ran a news story last night (link) regarding a couple that bought a house that had been previously gutted by fire.  The problem was that this had not been disclosed by the previous buyer and the buyer is now saddled with a $200K bill to repair even though it is obvious that the previous vendor would have been aware of this damage.

The problem with property disclosure sheets (PDS) is that they are seldom filled out in an accurate manner.  The vendor may not know or may just lie about the condition of the home.  I have often seen deficiencies in homes that are very visible yet not identified accurately on the PDS.  There also does not seem to be any enforment of the document and limited opportunities for recourse.

SENWI has long advocated to change the laws regarding the PDS.  We feel, that like a car, ALL significant repairs or renovations over $5K should be registered against the property.  A purchaser should be able to receive a report from the land titles office, as part of the purchase conditions, that provides the full history of the home.  Contractors and Municipalities should be required by law to register their activities with the dwelling (like renovations, attendance by fire services for fires, floods, grow ops., storm damage, mechanical damage from vehicles, etc). 

For now however, buyers should not place any faith in a PDS (only pay attention to defects positively identified as being present and ignoring those that are identified as unknown or not present).  Buyers should always hire an independent home inspector (not the one your agent recommends). An independent home inspector will work for you (and only you) and attempt to reduce your liabilities in buying a dwelling that you have no previous knowledge of by means of a thorough and detailed inspection of the dwelling. 

Realtor referrals for inspectors

At SENWI, we insist that any inspector that provides services for us be independent from Realtors and usually maintain a membership in the Independent Home Inspectors of North America and must take the “No Conflict of Interest Pledge”.

It is critical that the inspector provides an unbiased evaluation free from any influence. Even a good/professional relationship between a Realtor and Home Inspector can influence the service that a client receives as the relationship between the Realtor and Inspector can become stronger than the relationship between the Inspector and Client. We believe this type of relationship is not in the best interests of the consumer.

Our inspectors do not solicit Realtors for referrals, do not direct any form of advertising to Realtors, and do not provide or receive any form of compensation to or from Realtors,

When you hire a SENWI inspector you are guaranteed an inspector free from all Realtor or other Third Party influences, an inspector who is working solely for you and in your best interests.