Major work in co-ownership: a hindrance to sales... or an asset?

Selling a co-ownership is a major project that raises its share of questions, especially when major renovations are announced or underway. Roof repairs, elevator upgrades, pool repairs, facade renovations, and parking upgrades are all investments that worry potential buyers, but can also become valuable selling points if the information is well communicated.

Why do major renovations make some buyers hesitant?
As soon as a building is planning major renovations, many buyers become cautious. These projects often mean:

• A special contribution to be paid soon, sometimes worth several thousand dollars.
• Possible increases in common fees.
• A period of nuisance: noise, limited access, daily inconveniences.
• Doubts about the financial management of the co-ownership association.

While some may prefer to avoid any unforeseen expenses, others will see these renovations as proof of sound management and rigorous maintenance, guaranteeing long-term peace of mind.

Documentary transparency, your best ally!
For a seller, preparing the documents that govern this work is essential. Even before putting the property on the market, be sure to gather:

• Minutes of the last co-owners' meetings.
• The contingency study and the building's maintenance log.
• The co-ownership insurance contract.
• The current budget.
• Recent financial statements.
• Official resolutions regarding the work.

These documents detail:

• The nature of the work (preventative or corrective maintenance).
• The overall cost and the seller's share.
• The timeline and progress.
• Amounts already allocated to special funds.

By making this information accessible from the outset, you demonstrate your seriousness and reassure buyers.

Negotiating the price: an exercise in anticipation

Renovations almost always influence negotiations. Three scenarios are common:

1. The buyer requests a price reduction equivalent to the share of the work.
2. A financial adjustment is agreed upon before the notarial deed.
3. The seller chooses to pay their contribution and indicates this in the seller's declaration.

Practical advice: Discuss the known amounts during the first visits. Propose clear cost-sharing scenarios rather than postponing these discussions until the offer to purchase is made.

Impact on resale value

A building that has recently completed major renovations often gains in appeal: it inspires confidence and limits the risk of unforeseen expenses. Conversely, a poorly maintained building or one without sufficient contingency funds may see its value temporarily decline.

A well-positioned co-ownership can stand out thanks to:

• Proven preventative maintenance.
• Improved long-term value.
• Quality management by the syndicate.

Best practices before selling

To maximize your chances:

• Prepare complete documentation before listing your property on Centris.
• Have the syndicate of co-owners complete a request for information (DRCOP of the OACIQ).
• Include information on major renovations in the seller's declaration.
• Anticipate frequently asked questions and prepare clear answers.
• Stay informed about legal requirements, particularly regarding contingency funds and mandatory maintenance.
• Present renovations as an investment in the building's longevity, rather than a burden.

Conclusion

Major renovations are not necessarily an obstacle to selling a condominium. With a transparent, structured, and proactive approach, they can instead become a demonstration of thoroughness and a reassuring argument for buyers.

By focusing on careful preparation and the professional support of a real estate broker, you contribute to a smooth transaction and informed decisions, both for you and the buyer.

Nathalie Audet, Residential Real Estate Broker

3299 Rue Beaubien E,
Montreal, QC H1X 1G4
Office Tel.: 514 374-4000
Cell Tel.: 514 966-4417
Email: [email protected] 

The columns express the personal opinion of their authors and do not in any way engage the responsibility of the publisher of the site, Condolegal.com Inc. The content and opinions expressed in a column are solely those of their author.

                                                                  Back to chronicles