Developer Sales Process

Required Disclosures for Developers

Before selling a new condominium unit, developers must provide a disclosure statement to potential buyers. This statement ensures transparency and protects purchasers by outlining:

1. A copy of the proposed condominium plan

   
   

   • This shows unit boundaries, common property, and exclusive-use areas.

     
     

2. A statement of occupancy fees

   
   

   • If a developer intends to charge occupancy fees before unit ownership is transferred, this must be clearly stated in the purchase agreement and disclosure documents.

   • Occupancy fees are fees a purchaser may be required to pay before the developer properly transfers control of the condominium board.

   • These fees typically cover the developer’s maintenance expenses such as snow removal.

     
     

3. A statement of estimated contributions (condo fees)

   
   

   • This outlines the projected monthly condo fees and how they are calculated.

     
     

4. A list of any restrictions on the occupancy, leasing, or use of units

   
   

   • For example, rental restrictions or pet policies.

     
     

5. A proposed budget for the first year of operation

   
   

   • This includes projected operating expenses, reserve fund contributions, and anticipated costs.

     
     

6. A summary of any subsisting or proposed management agreements

   
   

   • Details about any condominium management contracts that will be in effect.

     
     

7. A copy of any recreational or service agreements

   
   

   • If the condominium has shared amenities (e.g., gyms, pools), agreements detailing costs and responsibilities must be disclosed.

     
     

8. The standard insurable unit description (SIUD)

   
   

   • A document that defines what the corporation’s insurance policy covers inside units and what unit owners must insure.

     
     

9. Any applicable warranties or guarantees

   
   

   • This includes warranties on the construction of the building and common property.

     
     

10. A description of any “phased development” plans (if applicable)

    • If the development will be built in stages, the disclosure must include the expected timeline and scope of future phases.

      
      

11. A copy of the condominium bylaws

    
    

12. The rules that govern the use of units and common property.

    
    

13. A copy of the reserve fund study (if the condominium was registered more than two years ago).

    
    

14. If the development has existing common property, the developer must provide a reserve fund plan or financial projections for future maintenance.

    
    

15. A statement of any material changes.

    
    

16. If there are any modifications to previous disclosures that could impact a buyer’s decision (e.g., increased condo fees, a change in amenities), these must be disclosed.

Purchaser Rights & the 10-Day Cooling-Off Period

Buyers of new condominium units have 10 days from signing the purchase agreement to cancel the contract without penalty. This allows them time to:

• Review the disclosure documents.

• Seek legal or financial advice.

• Ensure they fully understand the financial obligations and bylaws.

  
  

If a developer fails to provide required documents, the purchaser may have additional time to cancel the agreement.

Trust Accounts & Management of Developer Funds

To protect buyers’ deposits, the CPA requires all purchaser funds to be held in trust until the condominium unit is legally registered.

• Deposits must be placed in a trust account with a licensed Alberta lawyer, real estate broker, or financial institution.

• Funds can only be withdrawn once the unit is registered, or the buyer takes possession.

• Developers must not use purchaser deposits for unrelated construction costs.

  
  

Failing to comply with trust fund rules can lead to penalties or developer liability for financial losses.