Issues Regarding Townhouses


This website receives a disproportionately high number of letters from owners of townhouses. Small developments are particularly vulnerable to problems of bad management and incompetent and even unethical boards. Developers often build townhouses as condos rather than freehold because it is less expensive to do so. But it is a mistake and owners are the ones who suffer the consequences. Consequently, a new section entitled, "Issues Specific to Townhouses," has been added in Factors to Consider When Buying a CondoIt is also suggested that the letters under “Horror Stories About Special Assessments” be consulted as many come from owners in townhouse developments. Many of the letters about boards, managers, criminality, and abuse of legal letters also come from townhouse condos.

Question: We own a townhouse in a small development of less than 50 units and over the years the Board of Directors have allowed owners to change the gates of their front patio and backyard to upgrade them to better looking ones, and their screen doors both back and front and mail boxes even if these are common elements. But some of these gates have deteriorated and some of these doors need to be replaced as is the case for a few mailboxes but the Board refuse to replace them because they say that they are not responsible for upgrades. They will soon replace the gates for half of the units, those that are not upgrades and next year it will be the screen doors. It seems unfair to us that we won’t get the same service and to top this, when we moved here, we didn’t even know that our gates, doors and mailboxes were upgrades. No one told us of this.

— October 2009, Ottawa area

Answer: On the one hand, the board is correct that the corporation is not responsible to replace what are upgrades paid for by owners. One would have expected, however, that each upgrade should have been noted on the status certificate of each unit—otherwise, how can a prospective buyer know that the doors and gates are upgrades and that he or she will become responsible to replace them at his or her own cost? This has been an ill-advised decision on the part of the board(s) over the years, probably a question of ignorance rather than malice. The management company should have given them better advice. However, it is also possible that the management company saw this as a cost-saving device and a good way to reduce any increase in condo fees in the future.

You can imagine how costly this could be for owners in other townhouse developments if, for instance, a board allowed them to upgrade their windows and interior doors and even the steps to their patio or backyard when these are common elements as spelled out in their declaration. These would become very costly items down the road for future owners who would buy these units. As you can see, several issues are involved here. Click here for information on Requisitioned Meetings because this issue needs to be straightened out as soon as possible. And there are precedents to the effect that new owners who were never informed of these upgrades via the status certificate should receive the same services as other owners whose units have no upgrades of common elements. Click here for Why Is a Status Certificate So Important?

Letter: We live in a small townhouse group of 8 units. Our units are freehold and this includes all of our house and garage. Our common elements are the grounds in front and in the back, the fences and the stone pavements from the street to our individual garages. It is too expensive to have a management and no one wants to volunteer to manage and the services we get from that manager are as good as useless. No one wants to be a director either. Someone told me that we could deregister. Is that true?

October 2009, 905 area, ON

Answer: Yes, if all the owners sign an agreement to this effect and if you then have a requisitioned meeting of owners to set this in motion--this probably would be the least expensive solution for everyone concerned. There is no advantage in being a condo in such a situation. You will need to hire a condo lawyer for this and then you will, I believe, have to register your individual houses again perhaps with the help of a real estate lawyer. The condo lawyer will help you draw up a document to the effect that each freehold townhouse owns the grassy ground in front and the back of its own house, the fences, as well as the stone pavement that leads to each garage. Then, the lawyer will help you divide whatever is left in the bank accounts of the regular budget and the reserve fund among yourselves and share in the payment of the legal fees.