Video: What is a Status Certificate? | yael & co. real estate

Know Before You Close: Get the Status, Skip the Surprises.
Everything You Need to Know About Status Certificates Before Buying a Condo

If you’ve never owned a condo or aren’t currently shopping for one, you may have never heard of a status certificate. However, if you’re considering purchasing a condo unit, reviewing this document is a crucial step in making an informed decision.

What Is a Status Certificate?

A status certificate is essentially a collection of legal and financial documents that provide key details about a specific condo unit, the building’s common elements, and the overall condo corporation. It serves as a snapshot of the building’s financial and operational health at the time it is issued.

Because these details can change over time, it’s recommended to review a status certificate issued within the last 30 days to ensure you’re working with up-to-date information.

We’re breaking down condo ownership in Toronto. Watch these videos next to learn more:

How to Obtain a Status Certificate

If you’re a buyer or seller looking to review the status certificate, you must place an order—typically through the property management company. Under the Condominium Act, the condo corporation is required to provide it within 10 days and can charge a fee of up to $100. Some buildings offer faster processing for an additional fee.

The document package usually exceeds 100 pages, but here are the most critical aspects to focus on:

Key Information in a Status Certificate

Unit-Specific Details:

Legal description of the unit
Whether the unit includes a parking spot and/or storage locker
Ownership status of parking and locker spaces (owned vs. exclusive use)
Monthly condo fees (maintenance fees)
Status of the current owner’s fee payments (up-to-date or in default)

Condo Corporation Information:

The original condo declaration
Bylaws, rules, and regulations governing unit owners and common areas
Pet policies (allowed vs. restricted breeds, size limits, etc.)
List of condo amenities and what’s covered by maintenance fees
Any planned or upcoming condo fee increases
Outline of unit owner vs. condo corporation responsibilities (e.g., window repairs)
Legal proceedings involving the condo corporation
Financial statements detailing income, expenses, and liabilities
Reserve fund details, special assessments, and future funding projections

Get a better understanding of condo living in Toronto. Watch our explanation of condo ownership video right here.

Understanding the Reserve Fund and Special Assessments

What Is a Reserve Fund?

The reserve fund is essentially the condo corporation’s emergency fund, used for major repairs and replacements of common elements (e.g., roof repairs, elevator upgrades). The Condominium Act mandates that every condo conducts a reserve fund study every three years to assess whether sufficient funds are available to cover expected and unexpected expenses.

A well-funded reserve fund is a sign of strong financial management. If the fund is poorly managed, unit owners may be required to contribute additional funds to cover unexpected costs. This is where special assessments come into play.

What Is a Special Assessment?

A special assessment is an additional fee imposed on unit owners when the reserve fund is insufficient to cover unexpected repairs or major projects. If a status certificate indicates that a special assessment is currently in place or being considered, it’s a potential red flag. While this doesn’t automatically mean you should walk away from the purchase, it’s crucial to investigate further before making a commitment.

Still have unanswered questions? Here are a few more videos you might find interesting:

When Should You Review the Status Certificate?

You might be wondering at what stage in the buying process you get to review the status certificate. Here’s how it works:

Pre-Listing Review (Seller Provides Documents in Advance)
- In some cases, sellers may preemptively order the status certificate and make it available for potential buyers to review before submitting an offer.
Conditional Offer (Buyer Reviews After Offer Acceptance)
- If the seller has not provided the documents upfront, buyers can include a condition in their offer stating that the purchase is contingent on a lawyer’s review of the status certificate.
- The time allocated for this review will be specified in the offer and agreed upon by both parties.
- If the documents reveal no concerns, the buyer can proceed with the purchase. However, if red flags appear, the buyer has the right to walk away from the deal.

Final Thoughts

Reviewing a status certificate is a vital step in purchasing a condo. It provides valuable insights into financial stability, building management, and potential risks.

Taking the time to review this document with a real estate lawyer ensures that you fully understand what you’re investing in and protects you from unexpected costs down the road.

Still have questions about status certificates or buying a home in general? I’d be happy to chat! Fill out the form on this page, call 416-909-9235, or email info@yaelandco.com today!