Did You Know?
The BC provincial government made changes to the Strata Property Act (Act) that require all strata properties with more than four units to have a common property depreciation report completed by December 13, 2013.
The depreciation report is to provide estimates for "the repair and replacement costs for major items in the strata corporation and the expected life of those items."
What does this mean to you as a condo or townhouse owner or buyer or seller? "Pay Me Now or Pay Me Later".
The strata corporation can then use that information to assist it in determining the appropriate amount for the annual contribution to its contingency reserve fund. People can better see what future costs will occur and budget accordingly whether living in or determining the value of a strata unit. A value can be viewed as higher where a complex has a sizeable contingency fund AND work performed on schedule. A large contingency fund with a big shopping list of deferred work can be misleading. This is where reviewing a depreciation work shows its value.
An ounce of prevention is worth a pound of cure.
Pay less with monthly installments to a fund for timely maintenance or pay more fixing problems caused by neglection or delays. Is that townhome or condo with the lower strata fees REALLY cheaper or is there a special assessment around the corner or loss of market value in the building when problems come to light?
Would you buy a resale car without an independent inspection by a qualified mechanic?
Some people would. But likely at a heavily discounted price. Other people would even consider making an offer. The same thing I see with homebuyers.
For more information on depreciation reports, visit www.housing.gov.bc.ca/strata/regs