Self-Managed Condominium Corporations Can Pose Risks

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managementAlthough not very common here in the Collingwood- Blue Mountain area, there are some condominium corporations are self-managed rather than employing a property manager. How does this work?

Generally speaking, an owner or one of the board members takes on this role for a stipend. This is permitted by the Condo Act but a by-law has to be passed regarding any remunerations. The condos I know of who self-manage, have done so in order to save the costs of hiring a property manager which can often cost anywhere from $20 to $60.00 per door, per month and is paid out of the owners monthly condo fees.

As a condo owner/investor and condo corporation board member myself, I think the option of self-management can give rise to a whole bunch of problems. For starters, if the manager is an owner and/or board member, they could be in a conflict of interest. Secondly, the oversight of money could be more challenging. Thirdly, the Condominium Act governs the rights and obligations of owners and board members. Without formal training, would the self-managed corporation always know what they are obligated to do or enforce? A quick search on the internet will reveal hundreds of thousands of posts about condo management gone wrong and many relate to governance issues. The odds of problems may be greater with self-managed corporations.

It can be hard to find owners who have knowledge of building maintenance, budgeting, insurance and legal issues and who can also devote enough time to the condominium’s day-to-day business. In addition, a self-managed corporation would really need to have a strong system of checks and balances.

I know in one case in our area, a condo sold in a self-managed corporation and there were no books or financial records and, there was no status certificate available to the buyer. In another case, condo fees were very low but the lack of required maintenance over the years, all run by one person, meant that the property had generally fallen into disrepair and would require a special assessment to bring things in line.

A well-managed and healthy condo corporation can offer you the peace of mind and lifestyle you are looking for. To make sure it can meet these expectations, it is VERY important to get a status certificate which will among other things, outline the governance structure, the financial status of the corporation and any pending legal issues or assessments. If it turns out a condo is self-managed, it is critical that you obtain informed legal advice before proceeding.

Related Post

What is A Condominium Status Certificate?

If you are thinking about buying a condominium in Southern Georgian Bay, send me an email so we can chat.

PIE Pizza Coming To Collingwood

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PIE

Here’s another Christmas season treat to look forward to. The almost famous PIE restaurant from Barrie, is opening a location in Collingwood on December 26th in the former East Side Mario’s building.

Founded in 2009 with two locations in Barrie, PIE was featured on You Gotta Eat Here and has had a loyal following before and since. They are known for their wood-fired pizza’s with unique combinations. A recent article in the local paper quotes the owners as saying their 7,000 pound pizza oven from Italy can make 8-10 pizza’s every 90 seconds!

I am curious to have a “PIE-off” between Santini’s, who I think makes the best pizza I have ever tasted, and the new PIE pies.  Anyone care to join me?

PIE will be the third restaurant in the area to have recently been featured on the Food Networks, You Gotta Here show. The others that cover The Smoke and Tony’s Iron Skillet have not yet aired.

Collingwood and Area Real Estate Barometer Dec.5-11, 2014

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This market summary includes data for Collingwood, Blue Mountains, Wasaga Beach, Clearview, Grey Highlands and Meaford. The information was obtained from the MLS® statistics provided by the Southern Georgian Bay Association of REALTORS®. Previous week(s) in brackets.

Single Family Residentialbarometer
New Listings:  24 (36, 28, 34)
Average List Price: $511,417
Range of List Prices: $58,000-1,295,000
Number of Sales:  17 (24, 18, 28 )
Range of Sale Prices: $145,000 – $1,070,000

Condominiums
New Listings: 16 (9, 8, 12)
Average List Price: $263,606
Range of List Prices: $118,000 – $324,900
Number of Sales:   5 (5, 11, 8)
Range of Sale Prices: $128,000 – $570,000

Vacant Land
New Listings:  3 (6, 5, 5)
Number of Sales: 1 (3, 2, 0)
Range of Sale Prices: $325,000

Price Changes  24

Notables this week:

-one single family residence sold for more than it’s list price.

Note: All statistics obtained from the Southern Georgian Bay Association of REALTORS® Real Estate Board

Township of Clearview Planning Update: What Lies Ahead

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We recently attended the annual panel of Planners session which is an opportunity for us to interact with municipal staff and planners about local planning initiatives and developments. We will give you a synopsis of each area over the next few weeks.

Today, we are summarizing the presentation made by Michael Wynia from the Township of Clearview which includes the built communities of Stayner, Creemore, Nottawa and New Lowell.

  • Clearview has the largest amount of available and development designated land in Simcoe country
  • There is lots of development activity underway including residential intensification in and around the Stayner area and, lots of non-residential development as well including an $80million proposed project around the airport and, a large development at the corner of Hwy 91 and 26
  • Construction of Stayner servicing project is underway which will add capacity for about 5000 more units
  • The servicing project will also increase capacity for industrial development in the Stayner area
  • Clearview has one of the most comprehensive websites in the area with information on zoning by-laws, interactive mapping, application forms, planned developments and much more. Everything you ever wanted to know can be found on their website.
  • They are also making use of social media and sharing information through special purpose blogs
  • Some interesting projects underway; biodiversity projectChildren’s Outdoor Charter,  subdivision development and  agricultural innovation to name a few.
  • In addition to the increase in development in the area, they will also start a Stayner Downtown redevelopment project in 2015

All in all, my opinion is that Clearview has been very active and successful in breaking down silos of information between departments and in increasing transparency and sharing of information with the public. It appears to be on the cusp of a real upward trajectory of growth in all sectors. If properly managed, the future should be bright for this area municipality.  Here is a look at the extent of area developments.  Click on pictures to enlarge.

Clearview Residential Development Projects

 

Clearview Non Resdiential Development

Real Estate Market Recap For Collingwood, Blue Mountain and Area for November 2014

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Single Family Residential Sales in November moderated over the previous months, which is always the case as we approach the winter. Having said that, it was still relatively strong with 9.4% more sales in November 2014 compared to November 2013. (Interestingly, November 2013 vs. November 2012 saw 9% more sales as well.) Year to date, there have been 2091 sales, up 3.4% over the same month last year, with dollar volumes up 10.2% year to date, reflecting continued strong activity in the upper tier, as well as in most price bands in 2014.

The number of listings year to date are down 5.5%, and in particular, the month of November 2014 had 337 listings for the month, down 20.5% over November 2013. The year-to-date sales to listing ratio, which is the percentage of properties that sell, sits at a five year high at 36.53%.

Breaking down the market data by area, there are some significant differences in the communities we serve.   As you can see in the chart below, Meaford sales were up 9.6% in Nov. 2014 vs. Nov. 2013, followed by The Blue Mountains where sales were up 6.8%; Clearview, where sales were up 5.4%; Collingwood, where sales were up 5%; Wasaga Beach, where sales were up 4%, and finally, Grey Highlands were sales were down 5%, but the 12 month average price was up 27.9%. Balanced market conditions continue. At the end of the month, there were 2675 active listings for sale on the MLS® system.

Condominium sales of 38 units were up 35.7% over Nov. 2013 (28 sales) and sales totalling $8.787 MM were up 45.6% over same time last year.

When we look at the sale prices, in November 2014, the most active price ranges were the $200-$249,999 and the $250-$299,999 price ranges, with 30 sales each (60 in total) in November 2014. Year to date these same two price ranges have been the most active for units sold with 355 and 350 sales respectively.

All in all, it looks like a strong finish to the year with a continued risk of a lack of inventory which will continue to push prices up in the new year. For those thinking of buying, why wait until spring? Now most certainly would be a good time to jump while the December slow down sets in for Sellers and spring prices are not yet near.

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Collingwood and Area Real Estate Barometer Nov. 28-Dec. 4, 2014

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This market summary includes data for Collingwood, Blue Mountains, Wasaga Beach, Clearview, Grey Highlands and Meaford. The information was obtained from the MLS® statistics provided by the Southern Georgian Bay Association of REALTORS®. Previous week(s) in brackets.

Single Family Residentialbarometer
New Listings:  36 (28, 34, 28 )
Average List Price: $478,506
Range of List Prices: $120,000 – $1,696,000
Number of Sales:  24 (18, 28, 26)
Range of Sale Prices: $150,000 – $1,250,000

Condominiums
New Listings: 9 ( 8, 12, 13)
Average List Price: $236,767
Range of List Prices: $140,400 – $309,900
Number of Sales:   5 (11, 8, 9)
Range of Sale Prices: $44,000 – $165,000

Vacant Land
New Listings:  6 (5, 5, 12)
Number of Sales: 3 (2, 0, 4)
Range of Sale Prices: $48,000 – $515,000

Price Changes  33

Notables this week:

-four single family residences sold at their list prices.

Note
: All statistics obtained from the Southern Georgian Bay Association of REALTORS® Real Estate Board

Renting Out Your Investment Property in Blue Mountain

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no rent

The issue of renting out condos and chalets in Blue Mountain has been much talked about, including on this blog since 2008. It has raised anger, praise, legal challenges, public meetings, lobbyist efforts, potentially staff and political changes and most of all, confusion.

First, the issue pertains only to properties that are being rented out on a short term basis of under 30 days at a time. For example, renting out a condo or chalet for a week-end or for a couple of weeks are the types of situations covered under the STA (short term accommodation) by-law. Renting out seasonally or annually are not affected.

If you are thinking about buying an income property in the Collingwood or Blue Mountain area, it is critically important that you understand this bylaw if you intend to rent out your property short term. You can expect the bylaw to be strictly enforced.

In a nutshell, the current by-law says that properties must be licenced in order to rent out for periods of less than 30 days OR, they must be in a development where at least ten units under the management of one management program. For example, if you own a condo in the Village at Blue Mountain where ALL units are managed by Blue Mountain, then there is no problem. Outside of the Village it gets trickier. Let’s say you own a condo in Cachet Crossing that you wish to rent out and manage on your own. You would need to be licensed in order to do so.  These “Phas 2″ condos around the mountain were originally required to be licensed by December 1st of this year however, as of November 24th 2014, implementation has been delayed pending further consultation and study. The current licensing requirements are fairly onerous and expensive so my guess is that many people are just going to give up.

One of the surprises in the most recent amendments is that Mountain Springs Resort and Cachet Crossing have been included as areas needing licencing. The reason I find this surprising is that they are different from the rest as they enjoy Commercial Resort zoning. The by-law specifically states that commercial resort units are exempt but after heavy lobbying on the part of STA Property Managers, it has now been included in the by-law. I’d like to see a legal challenge on that can of worms!  In fact, the implementation of this amended by-law is being challenged by Blue Mountain and others resulting in the implementation delay referred to above.

While the by-law was originally driven by valid complaints from residential property owners, it has taken on a life of its own over the past 6 years and, in my opinion, has morphed into a bureaucratic mess that protects very few other than rental agents who will benefit from this. They formed an effective lobby group and it paid off for them.

So, if you are thinking about buying an investment property in Blue Mountain, stick to seasonal or annual rentals unless you locate in the Village or can find a licensed unit until such time as this mess is sorted out.  If on the other hand you are looking for a property you can enjoy yourself and or rent out seasonally, now is a great time to buy!  (Hint:  Seasonal rentals can often generate as good a net income as short term rentals and they are permitted without licensing. )

Collingwood and Area Real Estate Barometer Nov. 21-27, 2014

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This market summary includes data for Collingwood, Blue Mountains, Wasaga Beach, Clearview, Grey Highlands and Meaford. The information was obtained from the MLS® statistics provided by the Southern Georgian Bay Association of REALTORS®. Previous week(s) in brackets.

Single Family Residentialbarometer
New Listings:  28 (34, 28, 36)
Average List Price: $524,305
Range of List Prices: $187,500 – $1,999,000
Number of Sales:  18 (28, 26, 28)
Range of Sale Prices: $108,000 – $369,000

Condominiums
New Listings: 8 (12, 13, 16)
Average List Price: $349,813
Range of List Prices: $30,000 – $694,900
Number of Sales:   11 (8, 9, 6)
Range of Sale Prices: $149,900 – $425,000

Vacant Land
New Listings:  5 (5, 12, 6)
Number of Sales: 2 (0, 4,  1)
Range of Sale Prices: $29,000 – $189,000

Price Changes  19

Notables this week:

-one single family residence sold for more than it’s list price and one sold for more than it’s list price.
-one condo listing sold for more than it’s list price


Note
: All statistics obtained from the Southern Georgian Bay Association of REALTORS® Real Estate Board

587 Tenth St, Collingwood – A Home You CAN Afford

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main

As both rents and houses become more expensive, it’s getting harder for buyers to find affordable options in Collingwood. Increasingly, we are seeing people look to townhouses and other styles of condominiums as a viable option.

In Collingwood, many of the more affordable and larger condos are “in-town” as opposed to being located in the western part of the town where typically condos are newer or geared to recreational and part-time use making them more expensive. In the town core, the most affordable townhomes are generally older and offer more space for full time living.

Here is an ideal example. I’ve just listed this 1200 square foot, two storey townhouse in Vista Blue that features 3 bedrooms, 4 bathrooms, gas heating, updated windows, a full basement AND a garage for just $157,900. Considering that the least expensive, detached home with a basement in Collingwood is currently priced at well over $200,000, you can see why a townhome could be a great alternative.

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If you look at the math, this home could carry for about $1200.00 a month with a down payment of just 5%. That is about the same amount it costs to rent a unit in Vista Blue. So why rent when you can own? For investors who put down a larger down payment, units like this can generate a positive monthly cash flow.

living room (1024x752)

Don’t miss this great opportunity. Give me a call today at 705-446-1762 or email me at marg@collingwood-bluemountain.com and let’s get you started on the road to investing in home ownership!

Dags & Willow in Collingwood

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When people visit or move to Collingwood, they are often delighted to discover that we have wonderful little boutiques, speciality shops and gourmet food stores not usually found in towns this size.

One of my favourites is Dags & Willow Fine Cheese and Gourmet Shop which started selling their cheese through the local Farmer’s Market 9 years ago. By the end of 2005, they opened their shop on Pine Street downtown and after out-growing that location, they opened a spectacular new store on Second Street earlier this year.

In addition to selling a large array of artisanal cheeses from around the world, they also sell a range of gourmet products from cookies to mustards as well as prepared foods, breads, giftware and more. They have a must try policy of sampling the cheese before buying and the staff are all well versed in the nuances of their products.

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Dags & Willow also has wholesale and catering divisions. In a unique twist, they can even make you a cheese wedding cake.

For those who wonder, the business derives its name from the owners’ two dogs: Cagney and Willow. You can read more on their website. http://www.dagsandwillow.ca/ Go have a look – it really is a gorgeous shop that is a feast for the eyes. Oh, and may I recommend you taste the house-made Asiago dip?

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RE/MAX four seasons realty limited, brokerage  ♦  67 First Street Collingwood, ON L9Y 1A2  ♦  705-445-8500