What legislation and regulations govern condominiums in Manitoba?
Do provincial legislation and/or regulations require that developers of new condominiums provide a new home warranty to buyers?
Manitoba enacted the New Home Warranty Act in December of 2013. When the Act comes into force, which will be by proclamation, it will require that buyers of new homes in Manitoba be protected by a warranty covering construction defects.
Taxes & Additional Costs
What provincial and federal taxes do condominium buyers pay on their units?
- Provincial tax: There is no provincial sales tax on new or re-sale condominiums.
- Federal tax: Buyers pay Goods and Services Tax (GST) on the price of new units.
If you are purchasing a re-sale condo, GST will apply to your purchase if:
- You are buying the unit from someone who acquired and used the unit primarily (more than 50 percent) for business purposes (unless this was to earn long-term rental income);
- You are buying the unit from someone who has claimed input tax credits for improvements to the unit; and
- The unit has been substantially renovated. To find out what qualifies as a substantial renovation, see Substantial Renovations and the GST/HST New Housing Rebate, Canada Revenue Agency.
Be sure to enquire about the above before putting an offer on a re-sale condominium.
Are there any GST/HST rebate programs for condominium buyers?
Yes. Like other homebuyers, purchasers of condominiums can apply for a GST/HST New Housing Rebate. This rebate reduces the GST and the federal part of the HST on a declining scale, depending on the purchase price of your new home. For eligibility information, see GST/HST New Housing Rebate, Canada Revenue Agency.
Are buyers of new and re-sale condominiums responsible for any charges levied by the Province?
Yes, the land transfer tax. There are different rates to calculate this tax based on the value of your home. There is no land transfer tax on the first $30,000 in value. See Land Transfer Tax, Province of Manitoba, for the various rates.
Reserve Fund Requirements
Do provincial legislation/regulations require that all condominiums in Manitoba have a reserve fund?
Yes. There is no legislated amount. Unit owners decide, by a majority vote at least annually, how much they need to contribute to the reserve fund in the next year.
Buyer Beware: This could be as little as $1. The onus is on the purchaser to ensure that there is sufficient money in a reserve fund.
After 1 February 2015, a reserve fund study must be prepared and updated every five years. Directors, who have a duty to act with a view to the best interests of the condominium corporation, must consider the reserve fund balance that is recommended in the latest reserve fund study or update when deciding the total annual contribution. The board must report to the unit owners on the amount in the reserve fund and review the latest reserve fund study or update with the unit owners annually. When a condominium unit is sold, the buyer must be told what the actual balance in the reserve fund is, as well as the balance that was recommended by the reserve fund study.
How is a new condominium corporation registered?
A plan and a declaration are filed in the Land Titles Office.
The plan is prepared by a land surveyor and shows the location of the proposed condominium. (If any buildings have already been constructed, their location and architectural and structural details are shown on the plan.) The plan also indicates the boundaries between the units and the common property. This is important because many rights and obligations of unit owners and the corporation depend on whether a unit or the common property is involved.
The declaration outlines the key rules that govern the relationship among unit owners and the condominium corporation. These include matters such as how the common expenses are shared and how votes are assigned. After 1 February 2015, the declaration must also include a description of a standard unit for each type of unit.
Once these two documents are filed, the condominium corporation comes into existence.
Sale of Units
What rules does the developer have to follow when selling units?
A developer must provide certain documents.
What documents is the developer obliged to provide to a buyer?
A prospective buyer is entitled to receive the following information:
- The most recent financial statements;
- The budget for the current year that sets out the:
- common expenses and the amount of each expense
- monthly common expense contribution for each type of unit
- portion of the common expenses to be paid into the reserve fund
- amount in all reserve funds at the start of the current financial year
- A copy of the bylaws and rules, and any amendments;
- Any current management agreement, and any amendments, or proposed management agreement;
- A list of services not included in the budget that are provided by the vendor and any expenses that the vendor pays that could become a common expense in the future;
- A statement indicating whether or not the unit is rented out and, if it is, the length of time the tenant is entitled to remain there and a copy of the tenancy agreement;
- A statement specifying any parts of the common elements that the unit owner is not entitled to use;
- A copy of the proposed condominium declaration, or, if the corporation is already registered, a copy of the declaration, including (after 1 February 2015) any amendments;
- A disclosure certificate. This signed statement from the condominium corporation includes information about parking, major expenditures that the corporation has authorized, outstanding insurance claims, the balance in the reserve fund and other important matters. It must be dated no more than 90 days prior to the prospective purchaser receiving it.
- Property Disclosure Statement calling on sellers to disclose any known defects in their units, including whether the foundation or roof leak, whether there are problems with electrical, heating or plumbing systems, or if it has lead pipes. However, the seller and buyer may agree to waive this requirement.
After 1 February 2015, sellers must also provide buyers with the following:
- A copy of excerpts of the registered plan or the proposed plan to be submitted for registration that sets out
- the shape and boundaries of the unit and the location of the unit in relation to the other units
- the location of the unit with reference to the building and to the level, if any
- the common elements intended for the exclusive use of the unit owner
- A copy of any amendments to the condominium declaration;
- A copy of the current reserve fund study or the latest update to it, or of a summary of the study or update.
Buyers must also be notified that they can obtain a status certificate for their particular unit. A status certificate guarantees that contributions toward the common expenses are up-to-date with respect to that unit. The status certificate must be signed by the condominium corporation.
What documents must a condominium corporation provide a purchaser of a re-sale condominium?
Purchasers of re-sale units are entitled to receive the same information that purchasers of new condominiums are entitled to receive. They must also be told that they can obtain a status certificate for their particular unit.
Note: A purchaser who has signed an agreement to buy a condominium unit (from an individual owner or a property developer) may cancel the agreement within 48 hours (not including Saturdays, Sundays and holidays) after the agreement becomes binding and the purchaser has received all the required documents. If the purchaser has followed the procedures set out in The Condominium Act, the purchaser will be released and will get a refund of the deposit paid without having to provide a reason for the change of heart. After 1 February 2015, a purchaser will have seven days to cancel the agreement.
Estimating Operating Costs
Are there legislation/regulations that stipulate(s) what happens if a developer has inaccurately estimated the operational costs of a condominium?
No, but after 1 February 2015, declarants who sell one or more units or proposed units must prepare a statement of financial estimates covering a 12-month period. If the financial projection turns out to have been too low, the developer will have to pay the amount of the shortfall to the condominium corporation.
Rules for Initial Reserve Fund Savings
Is the developer of a new condominium obligated to put aside reserves as soon as the condominium is registered?
Yes, but there is no stipulated amount. However, after 1 February 2015, directors must consider the reserve fund balance that is recommended in the latest reserve fund study or update when deciding the total annual contribution.
Does the Province require a condominium to impose any bylaws and rules?
No, legislation doesn’t require this but condominium corporations almost always create by-laws and rules that set out how the corporation will be run.
Does condominium legislation authorize the condominium corporation to borrow money?
No, though a condominium’s by-laws will often address this.
Can a condominium corporation place a lien on an individual unit?
Yes, a condominium corporation can do so if the owner has not paid:
- His or her contributions toward the common expenses, reserve fund or special assessments; or
- For expenses incurred by the corporation in making repairs that the owner was obligated to make and failed to do so in a reasonable amount of time; or
- For repairs or work ordered by a public authority (such as the Fire Marshal).
A lien can be enforced like a mortgage and takes priority over other charges against a property unless otherwise stated in a condominium’s declaration (documents that describe how a condominium is organized and operated). The declarations of most condominiums in Manitoba give priority to a registered first mortgage — and sometimes any mortgage — over a lien. After 1 February 2015, condominium liens will be subject only to Crown claims, municipal taxes and other interests prescribed by the regulations. Mortgages will no longer have priority over condominium liens.
Elections & Meetings
What are the requirements for electing the board of directors and for its meetings?
A condominium corporation must be governed by a board of directors. Each condominium’s by-laws or declaration determine the number of board members, their qualifications, term in office, compensation and other related matters.
Changing the Governing Documents
How does a condominium corporation change its governing documents?
A condominium corporation can change its declaration and plan if it has the written consent of those who hold 80 per cent of the voting rights of the corporation--unless the declaration stipulates that a greater percentage is required. Unit owners are not obligated to hold a formal meeting to obtain this consent.
To change a condominium’s bylaws, a meeting of the unit owners must be held. There are several rules for calling and conducting this meeting, see Section 12 of The Condominium Act (after 1 February 2015, Part 6 of The New Condominium Act).
Bylaws can be amended by members who hold 75 percent of the voting rights who are either at the meeting or who use a proxy. At least half of the unit owners or proxies must attend this meeting.
Amendments to the declaration, plan and bylaws take effect once copies of them are registered at a Land Titles Office. The condominium corporation must provide a copy of any amendments to unit owners.
Can an owner stop paying condominium fees if he/she is unhappy with the condominium’s board of directors and/or property management?
Rules About Special Assessments
Do provincial legislation/regulations have rules regarding special assessments? If so, what are they?
Expanding the Scope of the Condominium's Assets and Services
What about additional recreational facilities/services? Could a condominium corporation buy a golf course, for example? Could it change the services an owner expects to receive?
The condominium corporation may make substantial additions, alterations or improvements to the common elements or substantial changes to the corporation’s assets. These changes must be voted for by unit owners who own 80 percent or more of the common elements.
Substantial changes are those that change the manner in which common elements are used or enjoyed or those that increase the operating expenses of the corporation.
Other Important Things About Buying a Condominium in Manitoba
Do provincial legislation/regulations govern renting or leasing a condominium unit?
Yes. The Condominium Act allows for a condominium corporation to collect a leasing levy (security deposit) from unit owners who rent their units. Beginning 1 February 2015, this levy is limited to $1,500. The levy (or unused portion of it) must be refunded to the unit owner when the lease ends. The corporation’s bylaws or declaration may specify that interest be paid.
The Residential Tenancies Act covers the rights and responsibilities of both landlords and tenants. For information on landlords’ and tenants’ rights and responsibilities in Manitoba, see Your Guide to Renting a Home, Provincial Fact Sheet — Manitoba.
What other constraints do provincial legislation/regulations put on condominium corporations, their boards of directors, bylaws and management?
After 1 February 2015, directors of boards have a duty to act honestly and in good faith with a view to the best interests of the condominium corporation. They must apply the care, diligence and skill that a reasonable, sensible, and cautious person would apply in similar situations.
Is there a process for handling disputes or complaints?
Both parties in a dispute may take the matter to arbitration (or mediation after 1 February 2014) provided they agree to this in writing. An arbitrator is a third party who decides its outcome. A mediator is a neutral person (someone who will not take sides), who meets with the people involved and helps them come to an agreement that all parties can live with. Arbitration is provided for under the current Condominium Act, and both arbitration and mediation are provided as an alternative to court action under the new Condominium Act, effective 1 February 2014.
Canadian Condominium Institute (CCI), Manitoba Chapter
An independent organization that deals exclusively with condominium issues and represents all participants in the condominium community.
Residential Tenancies Branch
Administers or is responsible for The Residential Tenancies Act, The Life Leases Act and The Condominium Act in Manitoba.
Winnipeg: 302 – 254 Edmonton Street, Winnipeg, MB R3C 3Y4
Toll-free in Manitoba: 1-800-782-8403
Brandon: 143 9th Street, Brandon, MB R7A 6C2
Toll-free in Manitoba: 1-800-656-8481
Thompson: 113 – 59 Elizabeth Drive, Thompson, MB R8N 1X4
Toll-free in Manitoba: 1-800-229-0639
Manitoba Human Rights Commission
Guidelines on condominium housing under Manitoba’s Human Rights Code for condominium corporations, management companies and condominium unit owners.
Winnipeg: 700 – 175 Hargrave Street, Winnipeg, MB R3C 3R8
Brandon: 341 – 340 Ninth Street, Brandon, MB R7A 6C2
The Pas: 2nd Floor – Otineka Mall, P.O. Box 2550, The Pas, MB R9A 1M4