The status certificate: read this before you buy a loft
The one document that tells you the financial and legal health of the building you're buying into.
What it is
A status certificate is a package of documents issued by the condominium corporation under Ontario's Condominium Act. It is a snapshot of the building and of the specific suite you are buying. Nearly every loft in Ontario is a condominium, so nearly every loft purchase involves one.
What is in it
- The suite's monthly common expenses, and whether the current owner is behind on them
- The corporation's budget and most recent financial statements
- The reserve fund balance and a summary of the latest reserve fund study
- Any special assessments, and any increase in fees since the budget was set
- Lawsuits involving the corporation
- The corporation's insurance
- The declaration, by-laws and rules, which cover things like pets, rentals, short-term rentals, renovations and flooring
Why it matters more in an older building
A converted factory can be a century old. Windows, masonry, the roof and the heating plant are expensive to renew, and the reserve fund study shows when that work is expected and whether the money is there. A healthy fund means repairs are paid from savings. A thin one means owners are asked to pay when the bill arrives.
How you get one
Anyone can request a status certificate from the condo corporation or its property manager. The corporation can charge up to $100, tax included, and must provide it within 10 days of the request. Sellers often order it before listing so it is ready to hand over.
Why a lawyer should read it
Most offers on resale lofts are conditional on the buyer's lawyer reviewing the status certificate. A lawyer who works with condominiums knows what a thin reserve fund, a pending lawsuit or a restrictive rule means for you, and will tell you plainly whether to go ahead.
Red flags
- A reserve fund that is low compared with the repairs the study says are coming
- A special assessment that has been approved or is being discussed
- Litigation that is not covered by insurance
- Rules that conflict with how you plan to use the suite
Ready to find your loft?
Talk to a loft specialist today. Honest answers, no pressure.