ANNOUNCER: I’m with Stephanie Sutherland from Cohen Highley Lawyers. Any advice for prospective condo buyers?
STEPHANIE: In our current high inflation, supply shortage environment, condo buyers should pay extra attention to the Condos Reserve Fund.
ANNOUNCER: Which is?
STEPHANIE: It’s the money the condo corporation has set aside for anticipated future major repair and replacement work. An engineer prepares an estimate of costs and timing for those major repairs and replacement projects, as well as recommendations on the amount the condo should pay into the fund annually. The problem is with the inflation and supply issues we’re seeing. Costs are more than originally anticipated, so reserve funds are often coming up short.
ANNOUNCER: How can you tell if a reserve fund is sufficient?
STEPHANIE: The only accurate way is if an engineer does an assessment, but not many condo buyers would pay for that. One thing buyers can do is have their lawyer look at whether the condo board has been putting away the recommended amounts in the engineer’s report.
