Strata Documents 101
Going over these documents can be a very long and painful process. Most strata document package range from 200 to 400 pages… or more! In most cases, obtaining and approving the strata documents will be part of the Buyer’s “Subject to” conditions. If it is a Subject, then we know it is crucial in the transaction.
As your Real Estate Advisor, I am here to guide you!
What are these documents?
Which document should we read first?
How do we know if the Strata is proactive?
Let us review the general terms first. If you already know your terms, scroll down to see the steps on how to go over the strata documents.
GENERAL TERMS
Form B — this document is drafted and approved by the Strata Manager. It discloses the most up-to-date information on the unit. The Form B will always indicate the current monthly strata fees, whether the unit owes any money to the strata, and if there are any special levies that the Strata Lot Owner has to pay. You will also find the unit’s parking number and locker number (if applicable) as well as the Contingency Reserve Fund (CRF) amount.
Special Levies — also known as special assessments, this is when the strata collects money from the strata lot owners for a specific purpose and for shared common expenses. If there is an ongoing special levy currently being collected by the strata, it will usually show up on the Form B.
Contingency Reserve Fund (CRF) — the purpose of the CRF is to pay for the common & emergency expenses that don’t normally occur (perhaps just once a year). Examples of CRF expenses include: replacing the roof, upgrading the elevator or lobby. This fund comes from the monthly strata fees.
Bylaws & Rules — every building has different restrictions. To find out what you are allowed and not allowed to do, review the Bylaw & Rules. The Bylaws outline what the building restrictions are (rental, pet, age.). This information is critical as it can affect the value of the property. The Rules are more of a general regulation for the strata (i.e: no laundry hanging in the balcony.)
Depreciation Report & Engineering Report — this is a thorough report generated by industry professionals that shows the lifespans, repairs, and maintenances needed for the entire building (roof, plumbing, exterior, interior, structural, cladding, boiler, fence and etc.) It will include visual format of photos, graphs and summary (similar to an Inspection Report.) The report will assess the building’s overall condition and estimate the future costs.
Minutes — records for the strata’s meetings between the manager and the residents. The Minutes will highlight the strata’s ongoing issues, repairs, maintenances, new projects as well as complaints. The industry standard is to obtain 2 years’ worth of minutes to find what happened in the past (improvements, security issues, leaking problems). From reading the minutes, you can also get a hint of how proactive the strata is. Note: review the AGM (Annual General Meetings) to see what are some highlights of the yearly meeting, and SGM (Special General Meetings) to see if there are any major projects coming up.
Insurance — every strata will have its own strata insurance to cover the common areas. We always advise our Clients to purchase the unit’s individual insurance to cover their own specific needs. For more info, we recommend speaking with a Home Insurance Agent and to read this source from the Government of British Columbia
Strata Plan — the strata plan is the plan that shows all the building’s strata lots (the units) and it is registered at the Land Title Office. Note that the Strata Plan is not the same as the floor plan, however it does show the overall dimension of the unit. You can double-check the unit’s dimensions with the Strata Plan’s dimensions.
FOLLOW THE SEQUENCE
TO UNDERSTAND WHAT EXACTLY IS GOING ON IN THE STRATA
Form B
Bylaws & Rules
Depreciation Report & Engineer Report
Strata Minutes: start from the oldest to the newest one
Financial Statement
Insurance (verify with Insurance Agent)
Strata Plan (verify the dimension)
Questions? Let’s Chat!
Written by Ck Real Estate Team
