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Condominium Primer

What is a condominium?

The term "condominium" describes a type of property ownership rather than a physical structure or style of building. Residential condominiums can be high-rise or low-rise apartments, townhouses, detached houses, stacked townhouses—any type of housing you can imagine. What makes them "condominiums" is not their physical structure, but the way owners have agreed to share ownership of common property (common elements), while keeping individual ownership of their own units.

Condominium ownership is not limited to residential property. Some commercial, recreational, and mixed use properties and bare land developments are condominiums as well. Within the individual unit, the condominium owner is in much the same position as anyone who owns a single-family dwelling. An owner has exclusive use of the property and must pay all costs associated with its operation and maintenance. The owner is also responsible for a portion of the costs of maintaining all the common elements in the corporation.

How is a condominium set up?

To create a condominium, a "declarant," usually the developer and vendor of the units, submits a number of documents, including a "declaration" and "description" of the property to the provincial Registrar of Condominiums. The Condominium Act sets out how this should be done. When these documents are registered, a legal entity called a condominium corporation is created. The Registrar makes sure there is continuing compliance with the legislation but does not participate in the day-to-day operations of condominium corporations or in subsequent sales of individual condominium units.

The primary purpose of the condominium corporation is to manage the condominium property and business affairs. The members of the corporation are the owners of the units. Some of the corporation's duties include:

  • managing and maintaining the common elements
  • establishing a fund for the payment of common expenses
  • making sure that a reserve fund study is undertaken and that the appropriate fees are contributed to the established reserve fund to replace major capital items, such as the roof or elevators
  • preparing the annual budget and assessing and collecting owners' contributions to these funds
  • paying common expenses
  • adequately insuring its liability to repair the units and common elements
  • holding annual meetings of owners
  • appointing an auditor (where there are 10 or more units) and filing an auditor's report and financial statements with the Registrar
  • making sure that the owners comply with the Condominium Act, the declaration, and the bylaws
  • keeping adequate records

Who owns what?

The division of ownership is set out in the condominium corporation's declaration. Basically, an owner owns a unit and a specified percentage interest in common elements, as set out in the declaration.

The contents of the declaration and description of any two condominium corporations are not the same. Areas designated as common elements in one condominium corporation might belong to an individual unit in another. In some condominiums, the common elements begin at the exterior wall of the individual units; in others, the exterior wall of the individual unit is considered part of the unit. Such small distinctions can mean a lot when it comes to a question of payment for items such as window-washing service or repairs to the exterior brick of a condominium townhouse.

A residential unit usually consists of the premises in which the owner actually lives. These premises are the property of the owner, who is responsible for their upkeep and maintenance.

Operating a condominium corporation

When a majority (51 per cent or more) of the units have been sold, the declarant or developer stops managing the affairs of the property. The owners take over responsibility for the condominium corporation and run it according to the declaration and bylaws. The following must be provided to the corporation by the developer at that time:
  • the corporation seal and minute book containing copies of the declaration and bylaws
  • copies of any agreements entered into by or for the corporation
  • any warranties or guaranties for equipment, etc.
  • all survey, architectural, and structural plans for the project
  • financial statements, the reserve fund study, and the reserve fund account for the condominium
  • a list of all units sold, unsold, or rented in the property

The board of directors is responsible for making sure requirements of the declaration and bylaws are satisfied, overseeing the management of the corporation, and making sure that the corporation's bills are paid. How often the board meets will depend on what business needs to be transacted, but can also depend on emergency situations, such as a wind-damaged roof or a fire that requires immediate action. The board must hold an annual meeting of the owners and, if the building has 10 or more units, must appoint an auditor. The term that board members will serve is set out in the corporation's declaration or bylaws.

What is a reserve fund study?

A reserve fund study is an assessment of the components of a building's common elements and determines a funding plan to meet the costs of repair and maintenance of the components over time. Part K of the regulations made under the Act deals with reserve fund studies, including
  • what a study must contain
  • who is qualified to conduct it
  • its components
  • the time period to be covered
  • definitions of terms used
  • other information to be provided as part of the study

Small condominiums of less than 10 units are not required by the Act to have a reserve fund study completed by a person qualified to conduct these studies under the Act; however, some smaller corporations voluntarily have a study done as part of their planning process. The Act requires that such corporations maintain a reserve fund balance of 100% of their annual budget or a greater amount as stipulated in the corporation's bylaws.

If a building is being converted to a condominium from another use, the declarant must prepare and submit a reserve fund study, regardless of the number of units.

Condominium insurance

Insurance on the entire condominium development is the responsibility of the condominium corporation. The corporation should place "all risks" property insurance coverage on the units and the common property. It is standard practice that the corporation maintains errors and omissions insurance for the board members. Ask to see it. Consider checking the policy for exclusions. You may want to find out if the insurance covers the replacement cost of the units and the common property. Your portion of the cost of the insurance purchased by the condominium corporation is usually included in your monthly condominium fees. Check this with the condominium corporation. You will need to buy your own insurance for the contents of your individual unit and any improvements made to it. The declaration for your condominium corporation will contain a description of a standard unit, which will let you identify these improvements. You should also have insurance to cover personal and occupiers' liability. Ask your insurance agent for more information.

Advantages and disadvantages of condominium ownership


  • It makes private ownership possible in areas where land values would ordinarily make this prohibitive, such as close to downtown.
  • An individual unit owner is not generally responsible for day-to-day maintenance often associated with home ownership, since exterior maintenance of the units, painting, snow removal, and landscaping are the responsibility of the corporation and are paid for through the common elements fees. Maintenance is usually carried out by a manager or under the direction of the board.
  • Owners can vacation and travel knowing that the exterior of their property will be maintained while they are away.
  • It lets the owner participate in decision making that affects the property.


  • Individual decision making gives way to decision making by the group of owners. You may not always agree with every decision.
  • Community living can have its ups and downs, and your enjoyment of your property can be affected by your neighbours, the amount of noise or smells coming from their homes, and their backyard activities; even parking can become the source of disagreement.

Owner's Rights and Responsibilities

  • Exclusive possession of the unit
  • The responsibility to maintain the unit
  • The right to vote in matters concerning the condominium corporation
  • The right of access to common areas, subject to the declaration, bylaws, and rules and regulations
  • The responsibility to pay common elements fees
  • The responsibility to participate in governing the condominium corporation

The Registry of Condominiums is available to respond to questions about the Act and regulations and condominium living issues. They may be contacted by email at or by telephone at 902-424-5139 or 902-424-5758.