Canada's Condominium Magazine
When you buy into a condominium community, you buy into a lifestyle. A great deal of the appeal this lifestyle holds is the freedom it entails. Condo owners have built-in security. They can pack up and leave for a vacation with no worries about leaving their home untended. They don’t have to shovel snow or cut grass. Their buildings often have very nice amenities—swimming pools, gyms, party rooms, rooftop decks for entertaining. The list of condo lifestyle benefits is lengthy and familiar.
But a condominium community does not run itself. Someone has to ensure that the daily affairs of the building and the concerns of the individual owners are dealt with in a timely and satisfactory way. For this reason, each condo community, which is a registered corporation under Ontario law, elects a board of directors to oversee the corporation’s finances, including how much each owner must pay in maintenance fees, and to enact and enforce rules and regulations (bylaws) to govern the life of the community.
To assist them in this, the board of directors will hire a property manager or a property management company. The main duties of the property management in a condominium include collecting common expense fees (maintenance fees), keeping records, maintaining the common elements of the community, maintaining security in the building(s), maintaining environmental standards, procuring appropriate insurance, preparing tax returns, and liaising with the board of directors. The property manager will also be required to liaise with the owners on a more or less daily basis, as a superintendent in an apartment building would. You can get a good overview of the way a condominium is set up here, at the Ontario Ministry of Consumer Services.
The human element
Outlined as above, the role of property management is pretty cut and dried. But in reality, of course, since property managers are people, and condo owners are people, the potential for problems to arise between them is virtually unlimited. Managers are often accused of being incompetent, lazy, unavailable, unresponsive, rude, ill-tempered—the list goes on. And owners too can sometimes be unreasonable, demanding, difficult, inflexible—this list goes on too. There are bound to be conflicts, misunderstandings, grievances, miscommunications, and all the other failings that make living with other people challenging.
Here is part of a typical complaint from an actual condo owner about her manager. The letter was written to the Condo Information Centre, a truly invaluable resource for anyone already living in a condo or contemplating buying one.
We have had this leak that comes from the roof into our place and it has been going on for over a year and the manager refuses to do anything about it and now we are starting to have mold. I have tried to get in touch with the board but she says that she can’t give us their address or email because of privacy laws. Can you help me because I am becoming very stressed out and I am worried about the effects that this has on my husband who suffers from heart problems. I can`t even think of selling because this would be too much for my husband`s health. So we are stuck and I feel terrible.
This sad letter illustrates perfectly the misery that a poor manager can cause for owners. No one should have to live like this. Having a good property management team in place ought to be the highest priority for any board of directors, and for any owner, whether the owner lives in the building or not. As authors Brian Persaud and Randy Ramadhin (Investing in Condominiums) put it:
Property management directly and indirectly affects the market value of your condominium. How satisfied residents are with the responsiveness of the property management, how easily the owners or tenants can book and use common element facilities, and the overall safety of residents will become part of the building’s reputation . . . How well—and how efficiently—a building is run will impact your investment in a number of ways: it will affect the quality of tenant you can attract; it will affect the financial stability of your maintenance fees (and thus overall the competitiveness of the building’s maintenance fees); and it will affect the marketability and resale value of your unit when you come to sell.
What, then, constitutes a good manager? Personality issues aside—you’ll always find people ready to complain that so-and-so is “nasty” or “unfriendly” or “thinks she’s better than us”—but when you get down to business, what makes an effective management team. The answer is best given in a different letter to the Condo Information Centre, which describes, albeit unwittingly, the “dream” manager:
We have a new manager and most of us on the Board of Directors are also new. At the second Board meeting, the manager presented us a spreadsheet with a list of things that need to be done this year, rationale, approximate costs, names of contractors, and a timeline. She asked us if we wanted to add contractors to her list because she said that she was going to get quotes before the next meeting where she hoped to have our vote. Then she walked us around to show us each item on the spreadsheet and asked us to study the situation and she hoped to have our approval. On top of this, she told us that we have to follow the Declaration and Rules of the corporation and allow her to have residents respect such. She may have 20 years of experience but isn’t she supposed to listen to our projects and not the other way around? Aren’t we supposed to be the ones to tell her what to do? She’s taking over our job? What should we do?
The stunning irony here is that the writer of this letter is actually complaining! It’s worth giving the complete reply, because, along with the letter itself, it makes it so clear exactly what the manager and the board are responsible for.
You have a gem of a manager! She is just doing her job and doing it so well. You probably did not know that it’s actually a manager’s duty to advise a board? Unfortunately, not all managers are able to fulfill this function because they neither have the competence nor the experience. As well, your manager respects rules and this is so important. Your job as the board is to do exactly what she suggested: Assess her proposals and if you want, suggest names of contractors you are not personally involved with. At the next board meeting, do ask her if either she or her management company is related to any of the proposed contractors, so as to make sure that there is no conflict of interest. Your manager is organized, knowledgeable, accountable, can plan for the future, is educating you (boards have to learn) and is definitely seeking board’s approval for the projects: She is not taking over nor shoving these projects down your throat. If you don’t want to keep this gem, please send her my way!
The takeaway here is that the success of a condominium community depends to a great extent on the quality of its board and of its management team. As a buyer, you would be well advised to check into the quality of management that exists. In the case of pre-construction sales, find out who will be managing if possible, and check them out.