In strata housing, individual owners own their specific strata lots while collectively owning the common property and common assets as part of a strata corporation. This means that while you have full ownership of your unit, shared areas such as hallways, elevators, roofs, parking garages, and amenities (like pools or gyms) are owned and maintained collectively by all strata owners.
A strata can take many forms, including:
If a property has shared common property, it is considered a strata. Each owner pays a monthly strata fee to cover maintenance and other expenses associated with common areas. Strata living provides benefits such as shared maintenance responsibilities and access to amenities, but it also comes with bylaws, rules, and fees that owners must follow. Understanding these aspects is key to deciding whether strata ownership is right for you.
When purchasing any form of property in British Columbia, the onus falls on the purchaser to investigate the state and quality of the property they intend to buy. When considering units in apartments, condo buildings, townhouses, and even duplexes, purchasers should ensure they have a subject condition in the Contract of Purchase and Sale allowing them to review and approve various strata documents.
The primary documents a purchaser should review are:
An important document that purchasers should be sure to review is the strata’s bylaws. Many strata's incorporate standard bylaws, which can be found online, attached to the Strata Property Regulations. However, some strata's create their own tailored bylaws. Regardless, it is very important that purchasers carefully review and understand the strata’s current bylaws to ensure there will be no unexpected surprises that will impact their desired use of the unit.
Purchasers should pay particular attention to any restrictions contained in the bylaws, such as age restrictions (some condos are 55+ only), pet policies, parking rules, or rental restrictions (including short-term accommodation prohibitions).
Some strata's are self-managed, while others are run by management companies that charge a fee to residents, which is included in the monthly strata fee.
These documents should be reviewed so purchasers gain a sense of the financial health of the strata. The financial reports will outline how much money is in the contingency reserve fund (CRF), the operating budget and fund, the amount of maintenance fees collected, and how much money is owed to the strata corporation.
Every three years, it is mandatory that a strata corporation obtain a depreciation report. This report is conducted by a professional company that assesses the condition of the building and suggests various funding models for what should be in the contingency reserve fund and how its should be funded. Note that these recommendations are not automatically implemented; the strata owners must vote on them.
Strata corporations and strata sections are required to contribute at least 10% of the value of their operating expenses to their CRF annually. For example, a strata corporation with operating expenses of $50,000 would need to contribute a minimum of $5,000 to the CRF. The fee that owners contribute to the CRF is part of their monthly strata fee.
Strata fees are based on unit entitlement, meaning the amount each owner pays is proportional to the total square footage of their unit compared to the total square footage of the building.
If you choose me as your real estate agent, I have extensive knowledge of purchasing and selling strata properties in Kelowna and the Okanagan. I can guide you through the process to ensure you understand all aspects of strata ownership and make the best decision for your needs.
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