The Essential Guide to Buying a Condo in Quebec

7 mars 2017,

Rising home prices have brought condo living into the mainstream, especially for younger families.  In 2014 alone, developers built a total of 7,886 condo units in downtown Montreal, with many designed for high-end buyers.  In the waterfront areas, newer developments are in progress as well as downtown.

With the weakening of the Canadian dollar against the US Dollar, the British pound, and the Euro, many foreign buyers are enticed to grab condominium units for sale in Canadian cities, especially in Montreal where the prices have stayed flat.

Without a doubt, condos have become extremely popular real estate choices in Quebec.  They have surpassed the traditional family home for first-time buyers.



It is not uncommon for real estate agents to hear clients ask, “Which is better, a condo or a house?”

There is really no right answer here because it all depends on the stage you are in and your lifestyle.

Urbanites find condos appealing because of short work commutes, pretty amenities like pools and exercise rooms, as well as minimal upkeep.

When you live in a condo, you can lock the door and take off for a long vacation without worrying about who is going to look after your place.

Many homebuyers look at the prospect of owning a condo as a stepping stone to owning a house much later, when they are ready to raise a family.

In big cities like Toronto and Vancouver, skyrocketing real estate prices have left many individuals with fewer options but to enter the market through the condo sector.  Many first time buyers find single family homes too expensive and have turned to buying a condo instead.

Here are some major differences between owning a condo vs. a house.

  1. Do you enjoy cutting grass, weeding, shoveling or maintaining a garden? If you don’t, you might enjoy living in a condo. Management retains professionals to do all that work which comes out of your maintenance fees.  If you like the prospect of not having to worry about maintenance, a condo would be a perfect fit.
  1. Houses, especially older ones, require repairs from time to time. Those who are handy around the house would not find repairs daunting.  For condo owners, they don’t have to worry about fixing what is not inside their unit, but they do have to pay for monthly maintenance fees.
  1. Amenities in a condo are great perks. It offers ease of living as you can enjoy a gym, pool, garden, or party space.  These aren’t easy to have in a single house.


In short, buyers who want a turnkey lifestyle find condos ideal.  It could mean having a hundred neighbors instead of just a few.  But if you don’t mind living in a large community, moving into a condo offers many unique advantages.

While it might seem less complicated to buy a condo than a house, there are some things that buyers need to consider before the purchase.



Are you interested in buying a condo in Quebec?  A condo is, indeed, a great option for those looking to invest in a property that is easy to move into and less expensive than a house.

When you buy a house, you purchase the building and the lot it sits on.  You have whole ownership of the property.  For condos, things work a little bit differently.

Buying a condo means becoming co-owner.  You will not manage the investment on your own and will be cohabiting with other owners within specific rules of conduct and operations.

In Quebec, there are 3 kinds of condo ownership – divided co-ownership and undivided co-ownership.


Divided Co-Ownership and Undivided Co-ownership – How they Differ

Most new condo developments and multi-unit buildings are divided co-ownership.

When you become part of a divided co-ownership, you own a private area for your exclusive use and become co-owner of common areas such as elevators, balconies, hallways, and amenities like the pool and garden.

The co-ownership agreement also sets conditions for the use of the premises.  It includes rules such as whether you can have a pet in the building and if you can have a barbecue outdoors.

As a co-owner, you are expected to contribute to common costs for maintaining the premises called as condo fees.

Divided Co-Ownership

  • ✓ When you buy a condo, you may get a storage locker and parking space which are given a separate property number in Quebec’s land register. You can sell your parking space only without giving up your condo unit and vice-versa.
  • ✓ If you will use the condo as a primary residence, you may also get financing from a lender for as much as 95%. However, some new developers may require a larger down-payment.  You are also taxed higher because taxes are computed based on municipal evaluation and your unit’s market value.
  • ✓ There are also several other documents you need to look into which are not applicable when buying a house.


Undivided Co-ownership

Some older duplexes and condo-conversions have undivided co-ownership.  Essentially, you are purchasing a share in a whole property.

For example, if you buy a converted duplex, you purchase 50% of the shares of the entire building and land.  You will be responsible for 50% of the costs for maintaining the whole building, including the windows, roof, foundation, yard, hallways, and everything else.  You retain exclusive use of your unit but you also own 50% of the shares of the entire property.


Before you sign your pre-purchase offer, there are a few “MUSTS” you need to do.

  1. Read the co-ownership agreement carefully. This will let you assess if joint ownership suits you.
  2. Don’t hesitate to ask questions from neighbors about their concerns, or research any building issues or administration problems. It is important for you to find out if the building is well-managed.
  3. Check the financial health of the condo syndicate before you buy. Does it have an adequate contingency fund?  By law, at least 5% of fees collected should be allocated for the contingency fund but in some cases, it may be inadequate if condo fees are kept low.


While condo ownership is a bit more complicated than home ownership, it offers a variety of benefits when it comes to convenience, freedom, and lifestyle.  Just remember that you are not just buying your unit but into all other aspects that can have an impact on your life such as other co-owners, condo regulations, the management of your building, and type of ownership.

A good real estate broker can help you with the condo buying process and help you to find the best condo that suits your needs and lifestyle.



Many Canadians look for profitable property investments for rent income.  Condos play a big role in the country’s rental market, especially in major cities.

In the recent years, the proportion of condos being rented out has increased.  With rising home prices, people from different demographics have found renting condos more affordable and convenient compared to buying a house.  With immigrant populations still increasing in major cities, there is a strong demand for condos for rent.

Real estate is a fantastic investment option because it is secured money from tangible assets.  It becomes a hedge against inflation and is beneficial for tax reasons.

If you are considering buying a condo as an income property, it is best to look for places where the demand for rental properties is high and monthly payments can increase annually.  It is not about buying the cheapest property possible but aiming for a yield which is better than if you play the stock market.

The biggest question on the minds of people wanting to invest in a condo is how to go about it.  How do you know it is the right property to buy?

As with any potential purchase, the most significant thing to consider is the numbers.  If the numbers are not good, then you can walk away.

What do we mean by numbers?  Like any investor, you care about cash flow.  It is important to study income against expenses.  It is so easy you can actually calculate it on a napkin.


How to Assess If you are buying a good Investment Property

  1. Determine monthly/gross income. What is the going rate for rent in the building or area?  You can obtain this from the property manager or your real estate agent.
  2. Estimate monthly expenses including insurance, property taxes, property management fees (if they apply), financing or mortgage, repairs, and vacancy. These last 2 – vacancy and repairs- should never be forgotten as they are part of property investment and can dramatically affect your cash flow.

Vacancy is conservatively estimated to be 10% of monthly rent while repairs for turn-key properties can be estimated at 5% of monthly rent.

  1. Deduct the expenses from monthly gross income to get your estimated cash flow. If you get a positive figure, YAY! If not, better run.
  2. For rental properties, every investor needs to see the cap rate and cash-on-cash return. Cap rate gives you an idea if you are getting a good real estate deal.  It means comparing the return on investment (ROI) with the purchase price.


  • Net Annual Income / Purchase Price = Cap Rate
    (Note: Mortgage payment is not factored in the cap rate)

The ideal cap rate for any property, residential or commercial, is 8%.  If it is over 8%, you have a winner.

Cash on Cash return shows how much you will get for the money you invest.  This is an accurate way to check the actual return for your cash and the leverage you are obtaining.  The mortgage payment is included if the investment is under financing.

  • Net Annual Income / Total Cash Invested = Cash-on-Cash Return

You can practice running these numbers on a napkin.  If you get a good cap rate (lowest at 6%) and the cash on cash return looks good, you can improve the figures even more by having a locked-in lease agreement with tenants (2-3 years) and investing in a property with a great location.


Ways to Save Money When Buying a Condo

You can become a homeowner without paying more than you should.  By learning the ropes, you can save money when you invest in a condo.

It is also important to know how much you need to set aside for the purchase.  While shopping for a condo, compare purchase prices and monthly fees.

  • 1. Prepare a sound financial plan.

It is advisable to sit down and plan your budget.  When applying for financing, try to obtain the maximum amount you can afford to pay.  Consider closing costs, land transfer tax, lawyers’ fees, and moving costs.

There are various types of mortgages so take the time to discuss your options with a financial advisor or mortgage broker.

You can check out condo purchase and recurring costs provided by Canada Mortgage and Housing Corporation to help you plan your finances.

  • 2. Buy during pre-construction.

Isn’t it risky to invest in empty air?  Developers sell condo units in a pre-sale and it can help you save money.  You can pay your deposit in installments and allow you to save up while your unit is under construction.  There is also the potential for increased value once construction is completed, especially if the condo is from a trusted developer.

You can also benefit from a greater choice of locations in the building and avoid noisy and intrusive repairs or renovations.  You can also enjoy a lower purchase price, depending on market conditions.

  • 3. Look for the right neighborhood.

When buying a condo, it is tempting to want to live right in the center of the city where everything is accessible.  However, these areas would also be the most expensive.  Consider buying in neighborhoods that are accessible to the trendy areas but less expensive.  You can also consider ditching amenities that are not that important to you such as a pool or a gym.  After all, you can always walk a block to the gym or live without a pool.

In Quebec, leases usually expire on July 1 and demand goes up as people start to look for housing.  It is a good idea to avoid buying from February to April when majority of condos sell.  Start looking to buy before this time when demand is lower.  Timing is essential in the real estate market.  You want to buy when most other people aren’t looking.



With professional help from a real estate agent, buying a condo can be stress-free and rewarding.

It pays to work with a real estate agent with a lot of experience with condos as they are very different from houses.

Whether you are purchasing the condo to live in it or to rent it out, there will come a day that you may want to sell. An experienced agent can help you find desirable condo properties with good resale potential and recommend ways to make your investment worthwhile.


Important Ways your Real Estate Agent Can Help with a Condo Purchase:

  1. If you are buying a pre-construction condo, your agent can help you to read and understand building plans. As you can’t see what your unit looks like just yet, your agent can help ask the right questions.
  2. A good real estate agent also knows the neighborhood and potential new developments that could cause issues such as a blocked view or traffic.
  3. Your agent will also negotiate the agreement to protect your best interests. There are things that can be negotiated so you can get a better deal.
  4. He will show you the best condo listings to help you find your most ideal property.


You can benefit a lot from the expertise of a knowledgeable real estate agent which can save you many headaches along the way.  From negotiating upgrades to a cap on developing closing costs, your agent will make sure the process is as smooth as possible.  More importantly, builders have built in the buyer’s agent commission on the purchase price and even if you decide to do it on your own without professional help, you aren’t likely to get a discount.

With so many nuances to buying a condo, it is most recommended that you get the help of a qualified real estate professional.

Want to find the best real estate agent to buy a condo? Compare 3 real estate agents from our network of qualified real estate professionals.

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