Comox Valley strata properties are fairly common in the Town of Comox and the City of Courtenay. The word condominium is used synonymously with strata property in British Columbia. Strata properties are very common in British Columbia and in the Comox Valley real estate market. But what exactly are they, and why are they different?
Strata properties are properties that enable an owner to own a separate part of a complex (such as a condominiums in the town of Comox/a> building or patio home complex) together with common features of the complex. In an apartment building, common features may include items such as recreational facilities, lobbies, the roof, etc. In a patio home complex, common features may include common property that will be maintained by someone other than the patio home owner in exchange for the payment of strata dues paid on a monthly basis. The advantage is that expenses for the maintenance of common property can be shared. However, there are also some disadvantages to the strata concept. Let’s examine this concept a bit further.
In a strata property, the part that is owned separately by an individual owner or owners is called the strata lot (also common called the strata unit). The remainder of the property is called common property. A strata owner owns the strata lot and a proportionate share of the common property. The Schedule of Unit Entitlement (UE) determines, among other things, what this proportionate share is in terms of strata fees and any special levies. The Schedule of UE is found in the strata plan.
Strata properties are governed by the Strata Property Act in British Columbia. Strata legislation applies to every type of strata. Strata legislation is self-governing, and the Strata Property Act (Section 165) gives every owner the right to apply to the BC Supreme Court to require the Strata Corporation to comply with the legislation.
When developers acquire land to develop a strata project they will either purchase the land or lease it. When purchased, the developer can then in turn sell fee simple title to the buyers of strata lot. The purchaser then becomes the registered owner in fee simple. This is commonly called freehold ownership. When leased (the developer must lease the land for at least 50 years from the public authority from which it leases the land), the developer is then able to offer leasehold ownership of the strata lots being developed.
When purchasing a strata lot, it is important to understand that the owner of a strata lot must pay the property taxes for that lot. For tax purposes, property taxes for each owner are determined from treating the strata lot and the owners’ share in the common property and taxable common assets as a separate parcel of land. Strata owners will also pay strata fees for the maintenance of common property. The Strata Corporation is responsible to repair and maintain common property.
There are two ways that a strata corporation can permit an owner to use common property as if it belonged to that owner. The formal method is to designate the area as limited common property (LCP). Informally the strata corporation can permit the owner short term exclusive use. This process is often used in strata plans where parking stalls and storage lockers are common property and they are “assigned” to individual owners and tenants. This privilege can be granted for up to a year.
In terms of parking and storage, strata plans generally have one or more of the following arrangements: the parking stall or storage area is a separate strata lot; the parking stall or storage area is part of the strata lot; the parking stall or storage area is part of the common property, or the parking lot or storage area is LCP. It is very important, therefore, to confirm the designation of parking and storage when purchasing a strata lot. This information is available in the strata plan.
Since strata owners are responsible to pay strata fees for the repair and maintenance of common property, prospective buyers of strata lots needs to be informed not only of the current strata fees, but the financial health of the strata corporation in case there are things such as planned future repairs, or some levy, fine or judgement against the strata corporation not yet factored in to the strata fees. The Information Certificate produced by the Strata Corporation containing this type of information is called a Form B.
Strata Corporations are governed by an executive body known as a Strata Council, and the owners of the strata lots are members of the strata corporation. Owners are eligible to sit on council. The Strata Property Act contains guidance on how strata corporations are managed. For example, the strata corporation must make annual contributions into a Contingency Reserve Fund (CRF) until the amount in the CRF equals at least 25% of the total amount contributed for operating expenses in the previous fiscal year. A strata corporation is permitted to raise money through special levies against owners. For example, a special levy may be made when there is not enough money in the CRF to pay for a major repair.
The Strata Property Act contains a Schedule of Standard Bylaws that apply to every strata corporation in the province. The strata corporation may amend the standard bylaws or create new ones. It takes a vote of 3/4 (after the first Annual General Meeting) of the members of a strata corporation to amend bylaws. Bylaws serve as the strata corporation’s constitution, and they govern the owner’s obligations, including the use of their strata lots and common property. For example, an bylaw may prohibit a strata unit from being rented (except to family members or under a hardship exemption) by its owner or it may prohibit pets on the complex. Another bylaw may restrict the age of the inhabitants of the strata unit.
Clearly, there are many more things that can be highlighted about strata properties in the Comox Valley real estate market. If you are looking for a strata property in the Comox Valley, there is a minimum amount of strata information that should be acquired and read by prospective buyers. As well, some strata properties such as duplexes have unique considerations associated with them. If you are considering the purchase of strata property, such as condominiums in the City of Courtenay, in the Comox Valley, or the purchase or sale of any other type of property, or you are in need of real estate information, contact Brett Cairns of RE/MAX Ocean Pacific Realty to discuss your Comox Valley real estate needs.
by Brett Cairns