Urgent notice for owners of Toronto freehold townhomes with a condo monthly fee

This article is a MUST read for all of you that live in a freehold town home with interest in common elements condo corp.  Too often, a seller will hire a realtor that is familiar to them but NOT with the sophisticated elements of today's properties. The letter below illustrates the importance of having a professional, full time realtor handling your property vs your uncle with the parked license that lives in Florida six months a year. Although the buyer agent is the one to prepare the offer, it's the listing agent who should ensure its done correctly and oversee the process.

Reprinted with permission from Stephen Shub.


Hi GTA Realtor,


Many freehold townhouses exist without any monthly maintenance fee BUT it has become more common in the last few years for builders to build FREEHOLD TOWNHOUSE projects which ALSO involve a common element condominium. The common areas of the townhouse project such as walkways, internal roadways and visitor parking areas as well as recreational amenities within the project and their outdoor lighting, grass cutting, snow removal and common area liability insurance are all CONDOMINIUMIZED resulting in a low monthly common area fee for each owner of a freehold townhouse in the project.


Any freehold townhouse, where the title ALSO comes together with an interest in a common element condominium corporation (a monthly maintenance fee) MUST have the offer to purchase by the buyer prepared on the OREA/TREB resale condo offer form and must also include a condition for condo status review.  If the offer to purchase is not on the resale condo form, THEN the buyer’s realtor (as a minimum) MUST insert in Schedule “A” a condition for the seller to provide a condo status certificate for review by the buyer’s lawyer.


A freehold townhouse was sold in the City of Toronto for about $800,000.00 and in the offer to purchase a clause stated that the buyer would assume the monthly common expense fee of the common element condo corporation. There was no condition for a condo status review and the offer was not done on the resale condo form.

Before closing, the buyer’s lawyer obtained the common element condo status certificate package and became aware that the reserve fund money had been fraudulently stolen by a prior management company and that there was virtually no balance in the reserve fund.  Special assessments were contemplated AND litigation was ongoing.

Now the buyer is refusing to close. The seller has sold to buy on the same closing date. The buyer’s lawyer is going to take legal action for negligence against the buyer’s realtor for failing to insert a condition for condo status review in the offer to purchase AND for not having prepared the offer to purchase on a resale condo offer form. If the offer had been on the resale condo offer form, then the buyer (in the fine print of the agreement) would have had the benefit of this standard resale condo offer clauses which state that seller warrants no special assessments are contemplated AND no litigation is pending.

When preparing an offer to purchase a freehold townhouse which has monthly maintenance fees for a common element condo corporation, make sure that the offer is prepared on a resale condo offer to purchase form AND has a condition for condo status review.

My website  allows anyone to calculate and print out legal fees and disbursements by clicking on QUOTATION for any purchase or sale price under $1.5 million. See our 8 Toronto area law office locations specializing in residential real estate closings at http://gta-home-legal-cost.com. For questions, call me to 11pm 7 days at (416) 520-6120.



Stephen H. Shub Professional Corporation
Barrister, Solicitor, Notary

8 Toronto Area Law Offices with
34 staff serving you in many languages
Cell 416-520-6120 
(to 11pm 7 days)

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Paul Indrigo

Paul Indrigo

Sales Representative
CENTURY 21 Regal Realty Inc., Brokerage*
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