Changes to the Condominium Act
Amendments to the Condominium Act will come into effect, along with new requirements in the Condominium Regulations, on September 1, 2011.
Changes to the Act and Regulations will strengthen consumer protection for prospective buyers and condominium owners, and will improve the administration of condominium corporations. Here are the top 10 changes:
Buyers can no longer be required to occupy a unit before the condominium is registered. The new regulations will set maximum occupancy fees, which must be clearly disclosed in the Agreement of Purchase and Sale.
If a buyer chooses to occupy the unit, any occupancy fees must be clearly stated in the Agreement of Purchase and Sale.
- The maximum monthly occupancy fee is 0.75 per cent of the net purchase price of the unit, and cannot be charged for more than six months after the original closing date. (The net purchase price means the purchase price before adding HST.)
- If, at the end of six months, the condominium corporation is not registered, the occupancy fee is reduced and it may not be more than 50 per cent of the initial occupancy fee disclosed in the Agreement of Purchase and Sale.
- At the end of 12 months of occupancy, the occupancy fee is further reduced and it may not be more than 25 per cent of the initial occupancy fee disclosed in the Agreement of Purchase and Sale.
- No other fees may be charged to the buyer before the final purchase date, including condominium fees.
Buyers must receive a copy of the condominium corporation's proposed budget for its first year after registration with the Agreement of Purchase and Sale. Developers must also keep a holdback of 10 per cent of the budget.
- Once the corporation is registered, owners will pay condominium fees based on this budget.
- If the corporation's expenses in its first year after registration go over the amount shown in the proposed budget by more than 10 per cent, a corporation can make a claim against the developer.
- To ensure these funds are available, the developer's solicitor will hold 10 per cent of that budget in trust from the amount paid for the first unit bought in the corporation.
The buyer's "cooling off" period will increase from five to 10 days.
- A buyer now has 10 days to review all documents related to the Agreement of Purchase and Sale.
- The buyer can cancel the agreement and get back their deposit by giving written notice to the seller no later than 10 days after signing.
Developers will now be required to have a reserve fund study completed for all buildings being converted to condominiums, regardless of size.
- The developer must give a copy of this study to a buyer with the Agreement of Purchase and Sale.
There will be a limit on the number of units a developer can buy on behalf of the corporation.
- The corporation cannot enter into an Agreement of Purchase and Sale to buy more than one unit in the corporation until the developer owns fewer than 50 per cent of the units and a board of directors has been elected.
- Once there is an elected board of directors, unit owners may consent to the purchase of additional units for the corporation.
The land proposed for future phases of a condominium development will be protected under a restrictive covenant.
- The land set aside for future phases can be used only for a purpose that is substantially similar to the purpose stated in the declaration and description.
Each phase of a phased development condominium must have secure essential services, and the time frame to complete phases in a development will be limited to 10 years from the date of the first phase being accepted for registration.
There will be a limit on the length of time that a corporation can be -bound by a management agreement.
Without the permission of a majority of unit owners, a developer or condominium corporation cannot sign a contract for property management or other services for more than two consecutive years.
Description of a standard unit must be placed in the declaration.
The description will include all fixtures and fittings that are standard to the unit. This allows a buyer to easily identify upgrades that may add value or require additional insurance.
Condominium owners and corporations will now have a less expensive way to resolve disputes Condominium Dispute Officers employed by Service Nova Scotia and Municipal Relations will be available to help to resolve disputes between condominium owners and condominium corporations. See Bulletin: Resolving Condominium Disputes.