What Are the Different Types of Condominiums in Ontario

When looking to purchase a condo, it might be a bit overwhelming at first, especially if you’re not used to shopping for one! There are different types of condominiums in Ontario to choose from. Some of these may come with higher fees or additional homeowner responsibilities. So it’s important to understand how each type will differ before you purchase. Let’s help you out with that by diving into the most commonly available options.

Standard Freehold Condominium Corporations

A standard freehold condominium is one in which the land is owned by the condo corporation. The building itself is then either broken up into condo units, townhomes, or row housing. When someone purchases a unit in this type of condominium, the builder transfers the title to the purchaser. They will then have full ownership of their unit as well as an interest in the common elements of the building. This includes the hallways, front entrance, landscaped areas and onsite amenities.

The common element expenses are shared by all the owners in the condo building and passed on by way of a monthly fee. There may also be “exclusive use” common elements which are designed for personal use. These might include the exclusive use of storage lockers or parking spots, for instance. The maintenance of common areas is also handled by the condominium corporation, which is great if you don’t want the responsibility of fixing a leaking roof or mowing the lawn.

With this type of arrangement, it’s also important to note that if the building is not yet registered (which is common among new builds), the builder is still technically the owner of the unit. The purchaser will be required to pay “occupancy rent” until the building is registered and title is passed along to the buyer. 

Common Elements Condominium Corporations

With this type of corporation, purchasers own the common interest attached to a parcel of land. There are no units to own as a result. Instead you are an owner of a parcel of tied land (POTL) that owns the common elements with the other owners. An example of this in action is a community where you own your own property that shares common elements with others, such as a street, park, or golf course. Each owner of the POTL will still pay common expenses monthly to cover any of the costs incurred by the common elements. Of course, this also means that the owners can enjoy the use of said element. 

Vacant Land Condominium Corporations

A vacant of land condominium is similar to a POTL, where homeowners will pay a monthly fee to maintain the shared elements. The difference here is that a vacant land condo is a piece of land with no buildings that are sold as homes. The buildings do not need to be constructed before the condominium corporation is registered. 

The corporation can register the land and sell it before any building takes place. This means that buyers purchase a specific piece of land, which can also be purchased prior to construction. If they buy it prior to construction of a home, they will be able to personalize some of the features in the home. In this type of arrangement, homeowners are also responsible for their own maintenance, so the fees tend to be lower than other condominium arrangements. 

Leasehold Agreements

A leasehold agreement is similar to renting but with a far longer time frame, typically lasting between 40 to 99 years. With a leasehold agreement, the land is not owned by the condominium corporation. Purchasers buy a “leasehold interest” in the units and common elements, but they do not own the land. Instead, they are given the right to exclusive use for a specific period, and a portion of the rent is included in the common area fee paid monthly to the landlord. Owners, however, do have the ability to renovate, sell, and mortgage their units like they do with a freehold arrangement. That said, once the ground lease expires, the owners no longer have the right to occupy the unit. 
Want to learn more about condominium living and options in your local area? At Medallion Capital Group, we are your one-stop-shop for all your real estate needs. Contact us today!