If you are thinking about buying a condominium in Ontario, you will likely hear about something called a status certificate. For many first-time buyers, this document may not be familiar, but it is one of the most important parts of the purchasing process.

A status certificate provides a clear picture of the condo unit’s financial obligations and gives insight into the overall health of the condominium corporation. It confirms whether the current owner is up to date on their payments, outlines any upcoming costs, and identifies risks such as legal disputes or future repairs that could impact your ownership experience.

In Ontario, status certificates are regulated under the Condominium Act, 1998, and must be provided within 10 calendar days of a written request. The fee is typically $100, and while it is usually paid by the buyer, this can vary depending on the terms negotiated in the agreement.

Why It Matters for Buyers

Buying a condo is not just about the unit itself. You are also buying into a community and becoming part of a larger corporation. The health of that corporation can have a big impact on your future expenses and overall satisfaction as a unit owner.

The status certificate helps you:

• Understand the condo’s current financial situation

• Avoid unexpected expenses

• Confirm the rules and restrictions that apply to you as an owner

• Ensure the seller has no outstanding fees or legal issues attached to the unit

It’s a crucial step in protecting your investment and making sure there are no surprises after closing.

What’s Included in a Status Certificate Package?

A status certificate is not just a single-page document. It typically comes as a package that includes several important items related to the unit and the condominium corporation. Here is a breakdown of what you can expect to find:

1. Unit-Specific Financial Information

The status certificate confirms whether the current unit owner has any unpaid common expenses. If there are outstanding amounts, this could affect the sale. It will also include the current monthly maintenance fees and indicate whether any changes to these fees are expected in the near future.

2. The Corporation’s Financials

You will receive a copy of the most recent audited financial statements, the approved annual budget, and a summary of the reserve fund. The reserve fund is set aside for major repairs and replacements, such as roof work or underground garage maintenance. A healthy reserve fund suggests that the corporation is well managed and financially stable.

3. Special Assessments

If a special assessment has been approved by the board, this information must be disclosed in the status certificate. A special assessment is a one-time charge to unit owners, often used to fund unexpected repairs or cover shortfalls in the reserve fund.

4. Legal Proceedings

This section outlines whether the condominium corporation is involved in any active or pending legal action. Legal issues can impact the corporation’s finances, increase insurance premiums, or signal internal governance challenges.

5. Insurance Summary

The package will include a summary of the building’s insurance coverage. This generally covers the structure, common areas, and liability protection. It is important to note that this insurance does not cover your personal belongings or upgrades within your unit. Owners are responsible for obtaining their own unit insurance.

6. Rules, Declaration, and Bylaws

You will also receive copies of the corporation’s declaration, rules, and bylaws. These documents explain how the condominium operates and outline restrictions that may affect you. Common topics include pet policies, noise guidelines, short-term rentals, permitted uses of common areas, and rules for unit modifications. Reviewing these carefully will help you determine whether the building is a good fit for your lifestyle.

7. Management and Contact Information

Finally, the package will include the name and contact information for the current property management company. A capable and responsive management team plays an important role in maintaining building operations, enforcing rules, and supporting the board of directors.

What First-Time Buyers Should Look for in a Status Certificate

While it is always recommended that a lawyer review the status certificate before closing, it helps for first-time buyers to understand what this document reveals. A status certificate provides key information about the financial and legal standing of the unit and the condominium corporation. Knowing what to look for can help you spot potential risks early and feel more confident in your purchase decision.

Here are the most important items to review.

1. Outstanding Common Expenses on the Unit

The status certificate will confirm whether the current unit owner has paid all common expenses, also known as monthly maintenance fees. If the owner is behind on payments, this could affect the sale. In certain situations, unpaid fees can result in a lien being placed on the unit. That lien must be discharged before closing.

What to check:

• Is there a balance owing on the unit?

• Has a lien been registered?

If anything appears unclear, your lawyer can request clarification from the seller’s legal representative or the management company.

2. Reserve Fund Health and Long-Term Planning

The reserve fund is used to pay for major repairs and replacements to the building’s common elements. The status certificate package will include a summary of the reserve fund study, the most recent audited financials, and the approved annual budget.

A well-funded reserve indicates that the corporation is planning responsibly. A low or insufficient reserve may increase the likelihood of future special assessments.

What to check:

• Is the reserve fund balance aligned with the reserve fund study recommendations?

• Are major repairs coming up that could strain the fund?

• Is the reserve fund being adequately replenished through the monthly fees?

Your lawyer can help assess whether the reserve fund appears appropriate for the age and condition of the building.

3. Monthly Fees and Planned Increases

The status certificate confirms the monthly maintenance fees for the unit and whether increases are expected. These fees cover day-to-day operating costs, reserve fund contributions, and shared services such as utilities, cleaning, and landscaping.

Buyers should compare the fees to other buildings in the area. Increases are not uncommon, especially in aging buildings or during periods of inflation. Reviewing the budget will give you insight into how fee amounts are determined.

What to check:

• Are fees projected to increase in the near future?

• Does the current budget reflect a surplus or deficit?

• Do the fees seem reasonable based on the building’s age and amenities?

If the corporation is running a deficit or has deferred maintenance projects, the fees may need to increase to compensate.

4. Special Assessments

A special assessment is a one-time fee charged to unit owners when the reserve fund is not sufficient to cover major repairs or unexpected costs. If a special assessment has been formally approved by the board, it must be disclosed in the status certificate.

However, if a special assessment is only being discussed and has not yet been approved through a board resolution, it may not appear in the certificate. In some cases, your lawyer may recommend reviewing board meeting minutes to assess whether a future assessment is likely.

What to check:

• Is there a current special assessment affecting this unit?

• Has the assessment been approved and scheduled?

• Are there any indications of additional assessments coming?

If there is an assessment in progress, your lawyer will determine how it impacts your offer and whether the seller should be responsible for paying it prior to closing.

5. Legal Proceedings Involving the Condominium Corporation

The status certificate will state whether the condominium corporation is involved in any legal proceedings. These may include lawsuits related to construction deficiencies, disputes with vendors, enforcement issues with unit owners, or claims filed through insurance.

Legal action can create financial risk, increase insurance premiums, and affect the reputation of the building. Not all litigation is a cause for concern, but it should be reviewed in context.

What to check:

• Is the corporation named in any legal proceedings?

• What is the nature of the dispute?

• Could the outcome result in additional costs for unit owners?

Your lawyer can evaluate whether any legal matters present a risk to you as a prospective buyer.

6. Rules, Declaration, and Bylaws

The status certificate package includes a copy of the condominium corporation’s declaration, rules, and bylaws. These documents outline how the building is governed and what restrictions apply to unit owners and residents.

It is important to review these documents to ensure they align with your needs. For example, some condominiums limit the number of pets, prohibit short-term rentals, or have restrictions on renovations and balcony use.

What to check:

• Are pets allowed, and are there restrictions on breed, size, or number?

• Are rentals permitted, and is there a minimum lease term?

• Are there any restrictions that could affect how you intend to use the unit?

Buyers planning to rent out the unit or make upgrades should pay close attention to these rules before finalizing their offer.

Why Status Certificates Reflect Your Corporation’s Professionalism

As a condominium board, every status certificate issued reflects on your community. A delayed or inaccurate certificate not only frustrates buyers and sellers; it can also signal disorganization or mismanagement.

Well-prepared, timely certificates help:

• Streamline sales and refinance transactions

• Support transparency and buyer confidence

• Prevent legal risks related to incorrect disclosures

Choosing the right condominium management partner ensures that your corporation’s reputation is protected and that unit owners have the support they need during important financial decisions.

Final Thoughts: Transparency Builds Trust

For first-time condo buyers, the status certificate might seem like just another document. But it’s one of the most important tools you’ll receive to help you make an informed decision. It offers insights into the building, the finances, and the overall governance of the condo corporation.

For condo boards, every certificate issued is a reflection of your commitment to transparency and professionalism. The process should be seamless, timely, and accurate. If your current management provider isn’t delivering that standard, it may be time to consider your options.

Looking for a management company that prioritizes transparency, efficiency, and service? Contact ICON Property Management today to request a proposal.