Since the pandemic began, Calgarians have been getting rid of their downtown condos and switching to single-family homes, says realtor Justin Havre of REMAX First in an October CTV News article. He says that people are looking for more space as they continue to work from home, and that the closeness of living spaces in condo buildings is making them less attractive to buyers. There are fewer people looking for the convenience of being able to get downtown fast, too. As demand for condos is down, condo prices have now fallen by about 23% or even higher, with some that would have gone for about $225,000 now selling at $150,000, Havre says.
Across the city, this is great news for buyers, but not so great for owners who bought more than five years ago. The Calgary Herald says that since oil prices bottomed out in 2014, home and condo prices have been slowly coming down each year as well. They report the average price of a single-family home in Calgary at $466,000, down $30,080 (or 6%), and condos at $248,500, on average, which is $41,900 less than five years ago, or a drop of 14%.
Recently, as well, condominium buildings are having difficulties finding coverage for their common areas due to a high number of claims, leading to ever-rising condo fees for some. This is why we always advise having a full condo document review done by a professional before buying. Issues like these, however, are also reasons why the condo market is less stable than detached homes.
There is light at the end of the tunnel, however. September was the strongest month for housing sales in six years in Calgary. Because condo prices are becoming more reasonable, it’s likely that a new generation of first-time buyers will begin to fill up the surplus, which will increase demand. Condo builders have also slowed down in order to not flood the market. And once the economy stabilizes, the downtown area will start to fill up again. Until then, however, condo owners should do their best to maintain the value of their property as best they can.
Maintaining the value of your condo
Keep your condo in pristine condition and do your best to budget for regular upgrades to get the most out of your investment. Remember that, generally, “fixture fashion” lasts about eight years, which means that kitchens, washrooms, and lighting can become outdated quickly. There is stiff competition in the market, so condo owners need to stay ahead of the curve.
- Beautiful flooring such as natural wood or engineered hardwood provides a polished look that will last and attract buyers.
- You can make a kitchen look like new just by painting cupboards to lighten them up and adding new door handles and pulls.
- A backsplash can add new life to a kitchen, and is a relatively cheap project that can often be done yourself.
- Upgrade your storage spaces with shelving and clothes racks that make sense.
- Change out old and yellowed switchplates and outlet covers for newer ones for a subtle improvement.
Keep informed on the actions of your condo board
A condo board is essentially responsible for the care and upkeep of the entire building. They have a very important job, and all owners should be aware of how they are operating. Among a number of responsibilities a condo board carries is to maintain the property through targeted upgrades and repairs paid for through condo fees collected. If you are doing everything you can to keep your personal property up, so should those who run the building. Most condo boards work with a property management company that specializes in the administration of condo buildings and that take care of arranging property maintenance, collects condo fees, help enforce bylaws, and carries out other duties under the mandate set out by the Board of Directors.
Condo property care can help owners maintain the value of their homes by:
- Being quick to respond to repair needs, and being proactive when possible.
- Working with reputable contractors who are capable of handling large and small jobs efficiently.
- Doing their best to provide excellent value for services (ie: assisting the board with contract negotiations).
- Raising the alarm if a board appears to be operating in an untrustworthy manner.
Condo insurance basics
A basic condo insurance policy protects:
- Personal belongings located in privately owned parts of the building, including your unit, your storage locker and your parking spot.
- Personal liability against accidents or injuries that occur in your home.
- Coverage for damage caused by a named peril, such as fire or water.
Beginning in 2020, all condo owners in Alberta should also have additional deductible insurance added to their policy – in fact, most condo boards will require it. The Government of Alberta enacted a major change to condo legislation allowing condominium corporations to require owners to pay the entire building’s deductible amount for claims where the damage can be proven to have originated in a suite or a private area, such as a storage unit or an owned parking spot.
This means that for an incident such as a toilet leaking in your unit that causes damage to the building’s structure or to another unit, or for a fire that starts on your balcony and spreads, you will be more than likely on the hook to cover up to a maximum of $50,000 for your condominium corporation’s insurance deductible. Whether or not you were negligent does not factor in. If you are a holder of a condo insurance policy, it’s very important to ensure that your policy includes deductible insurance that fully covers the amount of your building’s deductible.
Trust Lane’s for all your coverage needs
Lane’s Insurance is a full-service brokerage that works for you, not for the insurance company. Clients get access to the lowest possible Calgary condo insurance rates, as well as attentive service and extensive claims support. Contact us at: