Changes to Condominium Purchases and Sales

Effective February 1, 2015, the Condominium Act was replaced with a new Condominium Act. The new Act includes major changes for buyers and sellers of condominiums as well as for developers who build condominiums and directors who manage them. The changes apply to both new and existing condominium corporations and purchases of condominium units.

Some of the new changes include the following:

1. When making an offer to purchase a condominium, buyers are entitled to more extensive disclosure. Upon receiving the disclosure as may be required, including disclosure certificates from the sellers and the condominium corporation, the buyer now has the right to cancel the offer to purchase within 7 days (the “cooling off” period), where previously a buyer had only 48 hours.
2. At times changes may arise which affect the condominium being purchased. If such changes arise between the time the buyer makes the offer to purchase (and receives the disclosure documents) and the date of possession, such changes are considered “material changes.” The seller will then have a duty to inform the buyer of the “material change” and the buyer will have a further 7 days during which he or she may cancel the offer to purchase as a result of the “material change.” A “material change” would be if there is one or more changes in the information contained in the disclosure documents given of a nature that is so material that it would be reasonable for a buyer to cancel the deal as a result of such change. If a notice of a “material change” is not given, the buyer has the right up to the date of possession to cancel the offer to purchase and the seller could potentially be liable for damages should they arise.
3. Reserve fund studies will now be necessary and every condominium corporation in Manitoba must have such a reserve fund study completed by February 1, 2018. The study would include a plan showing that the reserve fund would have enough funds to meet the upcoming capital requirements of the condominium corporation.
4. A buyer is entitled to receive an excerpt of the specific part of the condominium plan which shows the location of the condominium unit they are purchasing. It is very important for purchasers to confirm they are acquiring the correct condominium unit.

Although the amendments and changes are numerous and extensive, the above highlights some of the major changes to the Condominium Legislation in the Province of Manitoba. Both buyers and sellers should seek legal advice when taking the important step of selling or purchasing a condominium unit.