BCREA’s Position on Strata Properties
The Strata Property Act took effect on July 1, 2000, and was a significant improvement over the Condominium Act. Nonetheless, no legislation is perfect and the intervening years have provided ample opportunity for real estate practitioners and others to identify improvements that can be made.
BCREA Recommends the Provincial Government:
- Add new provisions in the Strata Property Act to create an alternative dispute resolution process for strata corporations, as introduced in Bill 8, Strata Property Amendment Act, 2009.
- Ensure legislation specifies what is required to be reported in financial statements. While REALTORS® and BCREA support the ability of strata corporations to waive this requirement by a ¾ vote at a general meeting, a prescribed alternative short form should be required of all strata corporations. This form could be completed by the strata council or property manager.
- Prescribe a standardized depreciation report, updated annually with professionals completing appropriate sections. While REALTORS® and BCREA support the ability of strata corporations to waive this requirement by a ¾ vote at a general meeting, a prescribed short form should be required of all strata corporations. This form could be completed by the strata council or property manager.
- Require depreciation reports for new stratas (including conversions), and the reports should be paid for by developers. The reports should be made available to potential buyers, and reviewed by strata councils every five years.
- Add new provisions to s. 59(3) to require strata corporations to disclose information about:
- the designation of parking as either common property, limited common property, part of the strata lot or subject to a lease with the developer; if the parking and storage is designated as common property, the strata corporation should indicate how it will be allocated to a new buyer and what stall numbers and storage lockers will be assigned to the buyer,
- what equipment is leased,
- engineer’s reports,
- depreciation reports and/or reserve fund studies,
- age and material of roof,
- information about the building envelope, and
- number of strata lots in the strata plan allowed to be rented.
- Create additional provisions to assist self-managed strata corporations; i.e., a best practices guide created by the Financial Institutions Commission or a schedule of best practices appended to the Strata Property Act, similar to the standard bylaws.
The Civil Resolution Tribunal Act received Royal Assent in May 2012, and the tribunal is expected to be implemented by 2014. The Civil Resolution Tribunal will provide an alternative dispute resolution mechanism for strata corporations and others. On March 15, 2013, Cheryl Vickers was appointed to a six-month term as the Chair of the tribunal, to lead ongoing consultations and the development of the tribunal's processes, rules and technology. Vickers' background includes extensive experience with BC tribunals. Up to $500,000 has been committed to the tribunal as an initial investment.
On December 14, 2011, new strata regulations were released:
- depreciation reports – effective immediately, though stratas have two years to comply, and they can opt out with a ¾ vote (stratas with fewer than five units are exempt)
- contingency reserve fund changes – effective immediately, strata corporations are not required to fund contingency reserve funds above the minimum previously required (25% of the operating budget); however, strata owners may now make any additional contributions by simple majority vote (previously an annual 3/4 vote was required to make contributions to the fund above 100% of the operating budget)
- Form B Information Certificate changes:
- effective March 1, 2012, the following will have to be attached: strata corporation rules, Form J (the rental disclosure statement), the current budget and the most recent depreciation report (if any)
- effective January 1, 2014 (though stratas can use the revised form before then), better identification of how parking and storage lockers are allocated to strata property lots.
In May 2012, the provincial government passed the Civil Resolutions Tribunal Act, which offers an alternative resolution process for many strata disputes.