Strata corporations with five or more units must now provide the most recent depreciation report as part of the new information Certificate (Form B).
Strata corporations of four or fewer strata lots are not required to obtain a depreciation report by passing a resolution with a ¾ majority vote at an annual general or special general meeting. The Strata Corporation then has 18 months from their last exemption vote to either hold another vote providing for further exemption or obtain a depreciation report.
“This means a strata corporation not wanting a depreciation report will have to waive its requirement at each annual general meeting, according to Ed Wilson, a partner with Lawson Lundell Law Firm.
“In practice, this means that, if votes to exempt are being held annually at annual general meetings, there would still be about six months left to get a depreciation report done if the ¾ vote did not pass in a given year” says Wilson.
The depreciation report must be:
- Prepared by someone qualified such as an architect or engineer with errors and omission insurance; and
- Updated every three years
The depreciation report provides important information to owners, buyers, mortgage providers and insurers. The report must include:
- An on site inspection and inventory of the common property and building systems;
- A schedule of anticipated maintenance, repairs and replacement costs for common expenses projected over 30 years; and
- A financial forecast which includes costs and cash-flow funding models for the contingency reserve fund.
For more information read the Office of Housing and Construction Standards’ Guide 12: Depreciation Reports available here: www.housing.gov.bc.ca/pub/stratapdf/Guide12/pdf.
Changes to approval vote for repairs to strata common property
Until December 11, 2013 a strata corporation planning to collect a special levy for maintenance and repairs to common property and assets required a ¾ vote of owners to get the resolution approved.
On December 11, 2013 the Strata Property Act was amended by regulation to allow strata corporations that do not each the ¾ vote threshold, but receive 50% or more of the votes, to apply within 90 days to the Supreme Court of BC. Where the court approves the resolution, it will use an order allowing the strata corporation to proceed with the special levy and repairs. This change will facilitate critical repairs being made in the timely manner before further damage is done to the property.
For more information contact Harriet permit, manager Government Relations at: firstname.lastname@example.org
Strata Corporations must now identify parking spaces and storage lockers
In strata developments, parking areas and storage lockers are not all allocated in the same way. The specific rights of owners or tenants to use parking stalls or storage lockers vary depending on how the use of these areas has been allocated in the development.
Verifying use can be a puzzling problem for Realtors. As of January 14, 2014, the process is easier because of changes to the Strata Property Act. Strata corporations must now identify parking spaces and storage lockers associated with units on the new Information Certificate (Form B) given to potential buyers and anyone authorized by the owner or buyer.
Realtors assisting clients buying or selling strata property should review the development’s strata plan to determine whether parking and storage areas are designated as:
- A separate strata lot or part of a strata lot;
- Limited common property; or
- Common property.
The Strata lot or part of strata lot
This is any part of the registered strata plan identified with boundaries or as a separate strata lot and owned solely by the owner.
- Parking and storage areas may be designated on the strata plan as a separate strata lot or part of a strata lot.
- Parking and storage areas intended for commercial use can be designated as a separate strata lot, and will have their own strata lot number.
- Parking and storage areas intended to be used in conjunction with a residential strata lot cant be a separate strata lot, but can be designated as part of the strata lot and so share the same strata lot number as the residential unit.
- A parking storage area designated as part of a strata lot will always be owned by the strata lot will always be owned by the strata lot owner, and a strata lot owner will transfer ownership of these areas to a purchaser upon the sale of their strata lot.
Limited Common Property
Parking and storage areas are designated on the strata plan as LCP for the exclusive use of a particular strata lot. An owner with exclusive use doesn’t own the area, but has the exclusive right to use the area.
- LCP area are common property owned by all the owners in the strata corporation in the proportion to each strata lot’s unit entitlement.
- If parking and storage areas are designated on the strata plan as common property and aren’t limited to the use of a specific strata lot, and strata corporation can create LCP designations by passing resolution either by a unanimous vote or a ¾ vote.
- The right to exclusive use of an LCP area attaches to the strata lot, not to the specific owner. When an owner sells their strata lot, the right to exclusive use of the LCP area automatically transfers to the new owner of the strata lot.
Parking and stoage areas may be designated on the strata plan as common property. Similar to LCP, common property is owned by all the owners in the strata corporation in proportion to their respective unit entitlements.
The use of areas designated as common property can be allocated to owners in three different ways:
1. A grant of exclusive use. The strata corporation can give an owner exclusive rights to use parking and storage areas designated as common property for a maximum term of one year.
- The strata corporation can renew the term, alter conditions, and cancel at any point during the term by giving reasonable notice to the owner.
- The ability to use the common property attaches to the owner and not the strata lot. Vendors can’t contractually adding permission to use parking stalls or storage lockers to new owners, as with lease.
- The new owner must ask the strata corporation for permission to use the area exclusively.
- The strata corporation has discretion to grant exclusive use of the same or a different parking or storage area, or deny the new owner the right to use any parking or storage area.
2. An assignment of rights under a lease or license. When a developer creates a strata development, the developer can grant a lease or license over parking or storage areas to a related company or to itself (a head lease).
- The developer or related company can assign its lease or license interest in individual parking or storage areas to buyers of a strata lot in the development.
- Head lease or licenses of common property are created in developments with large underground parking and storage areas to enable the developer to control which buyers are assigned which parking and storage areas after the strata plan filed.
- Some head leases or licenses are worded so the sale of a strata lot to a buyer automatically trigger an assignment of the individual parking or storage area to the new buyer. If this isn’t the case, the vendor can contractually assign their lease or license in the contact of purchase and sale.
3. Common use of parking spaces. A strata plan may contain a parking area designed as common property that is not allocated to the use of any specific owners.
- Owners can often use common property parking areas on a first-come first-served basis.
- There may be also be strata corporation by laws or rules governing how owners use the parking area.
The definitive source for this information is the Office of Housing and Construction Standards. For information, go to: www.housing.gov.bc.ca. On the right-hand side, select Strata Guides and then Parking Spaces and Storage Lockers, Guide 29.
If you have questions, please contact Harrier Permut, Manager, Government Relations at: email@example.com
How Consumers value Features and Attributes of a Home.
- #1 is location
- if a home is less than 10 years old 26% higher value
- if a home is less than 5 years old 24% higher value
- a view 8% higher
- Good school nearby 8% higher
- Strata that allows pets 6% higher
- Strata that allows renters 5% higher
- Condos that are the same square footage, but the condo with a 1 bedroom, 1 bathroom layout would be valued 8% higher than the condo with 2 bedrooms and 1 bathroom. People prefer a more open floor plan.
With compliments from: Patrick Mulhern.