What To Look For When Buying a Condo or Townhouse

In this episode of Coffee Chat with Steve, we shift gears and talk directly to buyers. Whether you're buying your first condo or your fifth, it's important to know what you're really getting into — beyond just the paint color and floor plan.

Start with the condo fees and special assessments

Before you put in an offer, ask this: what are the current condo fees, and are there any planned special assessments? You should be able to find this information in the condo documents or strata documents provided as part of your due diligence. These are not just numbers. They give insight into how the building is funded, how well it's managed, and what kind of financial obligations you're walking into.

Special assessments are large, one-time payments that owners are required to pay to cover unexpected or underfunded capital repairs. They are often triggered by emergencies or poor long-term planning. Knowing about upcoming assessments allows you to prepare financially, negotiate on price, or reconsider your offer entirely if the risk outweighs the reward.

Check for major capital projects in the near future

The next big consideration is what capital projects are coming up in the next 5 to 10 years. You'll want to know this because major repairs can turn your dream home into a construction zone. For example, if the building is scheduled for a full building envelope replacement next year, that could mean tarps and scaffolding around your unit, noise and dust for 6 to 18 months, and disrupted access to balconies, windows, or entrances.

If you're planning to live there or rent it out, these disruptions matter. Being aware of major upcoming projects helps you decide if the timing and price still make sense.

Understand how inflation was accounted for in the budget

Another major consideration: has the building accounted for recent inflation in its long-term budget? Over the last 5 years, construction and materials costs have skyrocketed. If the condo's Reserve Fund Study or Depreciation Report is 3 to 5 years old, chances are it was based on pre-2020 inflation assumptions — usually around 3 to 4 percent.

In reality, multi-family construction costs have increased by over 60 percent since 2020, averaging 12 percent per year. If this hasn't been reflected in the financial plan, the building is likely underfunded. This could mean upcoming fee increases, future special assessments, or potential borrowing by the condo corporation or strata.

How to know if the building is well managed

All of this leads to the final — and most important — question: how can you tell if a condo building is well managed? That's where Stelor can help. We offer a Viability Review Service that analyzes your condo documents and returns a simple, clear picture of the building's financial health and upcoming obligations:

• A viability score that reflects the overall financial and operational state of the building
• A list of planned and likely special assessments
• A breakdown of assumed inflation vs. actual inflation, and the resulting funding gap
• A summary of capital projects scheduled over the next 5, 10, 20, and 30 years

All of this can be completed by uploading your condo documents into the Stelor platform — a process that takes less than 15 minutes.

Make smarter decisions with data

Buying a condo is a major investment. You deserve to know what you're really buying into. With Stelor, you get more than a stack of PDF documents. You get insights that help you make smarter, more informed choices. Whether you're buying your first home or your tenth, Stelor makes it easier to avoid surprises and feel confident about your investment.