Is it Safe to Buy a Home Without an Inspection in Toronto?
Is it safe to buy a home without an inspection? Or a condo without reviewing the status certificate? Or a co-ownership share of an apartment building without reviewing the estoppel? In a word, no.
Now you are probably wondering why? Let’s get into that answer. After all, knowing how to navigate Toronto’s competitive real estate market is critical to successfully securing your dream home or condo that will provide a secure and growing investment over the long term.
Home Inspection
The average home in Toronto is over 80 years of age. If it is still standing, you know that most of the house is fine and inhabitable. The questions that arise can be: 1) does it have a leaky basement?; 2) does the roof leak?; 3) what kind of wiring and plumbing?; 4) are there mold issues?; 5) Are there mechanical issues with the furnace or A/C?; 6) Is there a buried oil tank from decades ago? The list can go on and on. A great home inspection can give you a sense of what needs to be completed for the house to be up to code, functionally reliable, insurable and weatherproofed. Also, an overview of the costs to improve or remediate issues if needed. It is worth noting that even the best home inspectors in Toronto do not have x-ray-vision. They can flag concerns for greater exploration.
There are several ins and outs to home inspections. We, as a practice, hire a great home inspector whenever we list a house. We have a pre-list home inspection completed to help educate our seller, other buyer agents and potential buyers. We want to ensure that we offer the greatest education to all of those involved in the real estate transaction. It is essential to do due diligence when investing in a home. The risk of a money pit or other complications is too costly to gamble on.
Condo Status Certificate
A condo status certificate is an integral part of a condo sale in Toronto. This certificate gives an economic overview of the condo corporation and its rules and regulations. It states what the maintenance fees are and what is legally covered by those fees. It also states whether a special assessment is levied on the building or the unit. It shows whether the current condo owner owes the money or if they are in good standing with the condo. Corporation and condo board. These can be quite costly depending on the age of the building and the type of improvements that need to be made to the common areas. A lawyer should review the status certificate before committing to purchasing the condo. Some Toronto condo buildings are well-run and have less to be concerned about, while others have been cutting corners and have been poorly managed for too many years, which will cost the condo unit holders more money over time.
➤ Every good investment needs a well-planned strategy. Start preparing with the following:
- Are Condos A Good Investment?
- The Most Undervalued Condos In Toronto
- Condo vs House Investment
- Why Parents Should Invest In Toronto Condos For Their Children
- Millennial Home Buying Trends
Co-Ownership Estoppel
Co-ownerships are a lesser-known form of ownership in Toronto. Co-ops are much more common but are a different kettle of fish. Co-ownership buildings have what is called an estoppel which acts in a similar manner to a status certificate – the financial overview, special assessments, rules and regs, lawsuits, etc. The key difference here is that the form of ownership is in shares of the property. Every shareholder is listed on one title at the City of Toronto land registry.
Key Takeaway
Due diligence is the name of the game here. You must review a quality home inspection, an up-to-date status certificate or estoppel. The risks are too high to make an uneducated offer on a condo, house, co-op, or co-ownership space in Toronto. Taking things one step at a time with licensed, trusted professionals guiding you each step of the way is non-negotiable.
