Your Share: Unit Entitlement

Your Share: Unit Entitlement

“This Strata is voting on a $778,000 special levy! How much will I owe if that passes?”

When you buy into a Strata, you are buying everything from the middle of any external walls in and throughout your Strata lot BUT you are also buying into the Strata corporation and a share of the Common Property. With ownership comes a share in the assets and liabilities of that corporation.

When a Strata is first registered with the Land Title Registry, the Developer registers a Strata Plan which, among many things, explains the portion each Strata lot is responsible for within the Strata.

This is called “Unit Entitlement”.

Unit Entitlement is used to calculate your share of a Special Levy as well as your monthly maintenance fees. In most cases that you’d see in Vancouver condos and townhouses; the unit entitlement is based off of habitable area. As in a 600 sqft condo would pay half of the maintenance fees and special levy as a 1200 sqft unit in the same complex. But it can also be divided evenly, with each Strata lot paying an equal share. That situation would be more likely in a side by side townhouse complex where each unit is pretty comparable in size or shared assets.

You can find your share of costs by dividing your Strata lot’s unit entitlement by the aggregate of all strata lots. This chart should be attached to the Strata Plan when you are looking through Strata documents but is also typically attached to any notice of special levy votes or change in maintenance fees in the Council Minutes.
Here is an example of one of those charts showing the unit entitlement for each lot and the aggregate amount at the bottom of the page;

So for this example; Strata lot #1 has a unit entitlement of 758 out of a total of 32,799.
Divide 758 by 32799 and multiply by 100 to get a %. In this case Strata lot #1 would be responsible for 2.31% of the annual budget paid via maintenance fees and any special levies approved while they are the registered owner. ($17,971.80 of that $778,000)..

The unit entitlement can not be changed arbitrarily by the Strata Management or Strata Council. Whatever is registered in the land title office should be relied upon as any legal challenge or change would need to be registered with that Strata Plan as well.

Potential Buyers! 

Forecasting future costs for the time you plan to own a home is a big part of the due diligence necessary before committing to the purchase of a Strata property. If the Strata is expecting a large project (parkade membrane, rainscreen or exterior renewal) most likely the CRF will not have the funds to cover the expense and a special levy will be necessary; knowing your unit entitlement will put those numbers into perspective. A $778,000 special levy that costs you $1500 is a very different conversation than one that will cost you $17,981.80 after you’ve already dipped into your savings for the downpayment and closing costs.

Thinking of buying into a Strata property? 
Click here for more information on Stratas or reach out directly, let’s chat!



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