An important option for Alberta condominium owners is the guaranteed right to rent out our property if we want to or need to. A recent court decision confirmed this right. Readers in other jurisdictions - such as in British Columbia - take note; your laws may be different and, if I may say, are not as well thought-out.
We'll review the pros and cons of restricting the right of owners to rent out their condo homes in a minute, but first let's take a look at the Alberta court case that was decided in April, 2002. This story involves Calgary's gorgeous Eau Claire Lookout building, just off the Bow River with its walkways, and adjacent to Prince's Island Park. The building is a gem, the location is superb, and its community of residents is a cooperative mature group. The building has an enforceable over-40-years-of-age restriction, although one member of a couple may be younger than 40. Note that age restrictions are not contrary to the Alberta Condominium Property Act, and have largely been upheld by the courts.
The developers of Eau Claire Lookout, built in 1996, wanted an exclusive community in the building. While that was accomplished, and remains so today, the initial bylaw prohibition on renting out suites has been struck down. In summary, an owner had to move and applied to rent out the suite, which the corporation denied. The Board did its duty, by the way, as it had an obligation to enforce the bylaws it inherited from the developer. Lawsuit followed, the suite's owner won, and the bylaw prohibiting renting or leasing of suites is overturned.
My condominium real estate experience leads me to suggest that the building's property values have been enhanced by confirmation of the flexibility that all Alberta condo owners have; namely to live in, to freely sell, or to lease out their private property. There is also no risk to the peace and good government of the building through some suites housing renter residents, as opposed to owner residents. Behavior in condominium communities is regulated by the bylaws, and is enforced by the Board and its professional manager on owner and renter residents alike. Bylaws contravened by renters are deemed to have been contravened by the owners, as well.
From here forward the Eau Claire Lookout building will be on a par with every other residential condominium in Alberta, in that it will house a mix of owner and leasing residents. Because these are very high-end suites, there will likely be few renters, while in more affordable buildings there tend to be more condo homes rented out; sometimes even the majority of them. But any condo building might have at least a few renters, and good behavior is expected from all.
Compare this Alberta situation to B.C., where condo bylaws are permitted by provincial law to either prohibit or limit the leasing of condo homes. A unpleasant segregation has evolved. Some buildings entirely prohibit renting suites, in which case you'd better never have a personal crisis and need to rent out your suite, because you simply can't. Other buildings allow a limit of, say, 30% of suites to be rented, so your neighbour might be allowed to rent out his suite, but you're on a waiting list do to so....and your turn may never come. Finally, some buildings have no restriction at all, and so investors focus on buying up those buildings, which become almost entirely rental buildings, perhaps with an absentee-owner attitude to maintenance and bylaws enforcement. Talk about the need for buyer-beware!
Alberta's open approach is far preferable. It still allows condominium corporations to regulate the of leasing suites. In fact, property managers will tell you that it's easier for them to act on complaints against renter occupants, than it is against owning occupants. For example, the corporation may require a damage deposit from a suite's owner to cover any damage by the renter to common property. Unpaid condo fees can be collected in lieu of rents directly from the renter, while foreclosure action can be required to collect from owners. Seriously misbehaving renters can be evicted forthwith, but try telling a suite's owner to get out, which can be done, but it's a long process. In all, a well-run condo corporation has nothing to fear, but owners have flexibility and ease of resale, under Alberta's system of leasing out being permitted in every condominium community.
Calgary Condominium Directory
