Purchasing a condominium unit or a townhouse within a strata development is materially different from buying a freehold property. The buyer acquires not only physical space but also a proportionate interest in a shared legal and financial structure. The documents exchanged before closing, the condition precedents written into the purchase agreement, and the ongoing financial obligations that follow are distinct to this form of ownership. Understanding each stage of the process reduces the likelihood of unpleasant discoveries after the sale completes.

Resale Units vs. Pre-Sale Purchases

The majority of condo transactions in Canada involve resale units — existing units being sold by a current owner. In this case, the buyer benefits from access to the corporation's financial history, existing depreciation reports, meeting minutes, and a physical structure they can inspect.

Pre-sale purchases — where buyers commit to purchasing a unit before construction is complete — carry a different risk profile. The purchase is based on a disclosure statement (required in BC under the Real Estate Development Marketing Act) or an offering statement (Ontario). These documents describe the development, the proposed strata plan, projected fees, and the developer's financial structure. Buyers of pre-sale units have a rescission period — typically seven days in BC and ten days in Ontario — during which they can withdraw from the purchase without penalty.

Pre-sale units are subject to completion risk: construction delays, cost overruns, and changes to the unit specifications can all occur between the time of purchase and the transfer of title. Buyers should review the disclosure statement carefully and engage legal counsel before signing.

The Status Certificate, Form B, and Estoppel Certificate

The most critical document in any resale condo transaction is the disclosure document issued by the corporation. Its name and specific contents vary by province:

  • Ontario: Status certificate, issued within ten days of a written request. The corporation may charge a fee up to the amount set by regulation.
  • British Columbia: Form B (Information Certificate), typically obtained as part of the disclosure package in any resale transaction.
  • Alberta: Estoppel certificate, required to be provided by the seller prior to the buyer's opportunity to terminate.
  • Manitoba and others: Estoppel certificate or equivalent disclosure document.

In most transactions, the purchase agreement is made conditional upon the buyer's satisfactory review of this document, with a specified time period — commonly five to ten business days — to review and either waive or exercise the condition.

What the Status Certificate Discloses

The status certificate or equivalent document provides a snapshot of the corporation's financial and legal standing as of a specific date. Key items disclosed include:

  • The current monthly common expense amount for the unit
  • Whether any amounts are owing by the current owner (arrears)
  • Any increases to the budget approved but not yet in effect
  • The current balance in the reserve fund
  • Any pending or existing special levies or assessments
  • Whether the corporation is a party to, or aware of, any litigation
  • A copy of the current bylaws and rules
  • A copy of the most recent budget
  • Insurance coverage details
  • Whether the reserve fund study is current

A lawyer reviewing a status certificate looks specifically for red flags: low reserve fund balances relative to the depreciation report's recommendations, undisclosed litigation, recently passed special levies that attach to the unit, and bylaw provisions that may conflict with the buyer's intended use of the property.

Reviewing Bylaws Before Purchasing

The bylaws disclose restrictions that run with the unit regardless of ownership. A buyer intending to rent the unit short-term through a platform such as Airbnb may find that the bylaws prohibit short-term rentals entirely. A buyer with a large dog may find that pets over a specified weight are not permitted. A buyer planning a home office renovation may find that all alterations require council approval. These restrictions do not disappear upon resale and bind the new owner from the date of transfer.

Amendments to bylaws in most provinces require owner approval at a general meeting. This means that a restrictive bylaw cannot be reversed by the new owner acting alone; it requires assembling the required majority of all owners. Buyers should not purchase on the assumption that inconvenient bylaws will be easily changed.

Financing a Condominium Purchase

Lenders treat strata properties differently from freehold properties in several respects. Before providing financing, most institutional lenders will review the condominium corporation to ensure it meets their lending criteria. Factors that can affect a lender's willingness to finance a particular unit include:

  • The proportion of units owned by investors versus owner-occupants (a high investor ratio may concern some lenders)
  • The financial health of the corporation (a very low reserve fund balance or pending special levies)
  • Whether the development is in litigation
  • The minimum down payment required for condos under $1 million in Canada is five percent (with CMHC mortgage insurance); ten percent is required for units between $500,000 and $999,999 on a sliding scale under current federal rules as of the date of this publication

Some lenders apply additional criteria for high-rise developments where a significant percentage of units are listed for rent simultaneously, or for developments with known construction deficiencies. Buyers securing mortgage financing before or shortly after making an offer should discuss strata-specific lending criteria with their mortgage broker or lender.

Conducting a Physical Inspection

A home inspection of a condo unit differs from that of a house. The inspector assesses the interior of the unit — plumbing fixtures, electrical panel, appliances, windows, and any in-suite HVAC systems — but does not have access to common mechanical systems. The depreciation report and recent AGM minutes serve as an indirect substitute, flagging known deficiencies in the building envelope, roofing, elevators, or building-wide systems.

For townhouse units, the inspection scope may be broader, particularly where the unit has its own mechanical systems (furnace, hot water tank) rather than central systems shared by all owners. A clear understanding of what is inside-unit versus common-property responsibility is important before the inspection takes place.

Closing the Purchase

Once all conditions have been satisfied or waived, the transaction proceeds to firm status. From this point, the purchase agreement is binding on both parties. The buyer's lawyer prepares the title transfer documents, verifies that there are no title defects, and arranges for the payment of land transfer tax (applicable in all provinces, with additional municipal land transfer tax in Toronto).

On the closing date, the buyer's lawyer transfers the purchase funds to the seller's lawyer, and title is registered in the buyer's name at the provincial land titles office. From this date, the buyer becomes a member of the condominium or strata corporation and is subject to all of its bylaws, rules, and financial obligations, including ongoing monthly maintenance fees.

New owners should introduce themselves to the property manager and request a copy of the current bylaws, rules, and any pending maintenance work that may affect their unit or move-in process. Attending the first available AGM provides context for the building's governance structure and an opportunity to meet other owners and council members.