Types Of Ownership (Apartment and Townhomes)

Apartments & Townhomes

Whether you buy an apartment, townhouse or ½ duplex there are fundamental differences between the following types of ownership.

A. Strata Lot

 An individual purchaser of a strata lot will receive a fee simple estate in his/her particular unit and also a proportional share in the common property. 

B. Co-Operative Ownership

 Typically what occurs is that a company is incorporated and it, in turn, buys a building. A buyer in a co-operative corporation becomes a shareholder of the company which owns the building. In most cases, the shares entitle the buyer to a long-term lease on a particular unit.

C. Leasehold Ownership

 Whether the lease is held by the First Nations People or by the City, at some time in the future the lease will expire. While a term such as 99 years may not dramatically affect those that buy when the building is first offered to the market, as the term dwindles, the value of an interest will of course, lessen. You will never own the land.

D. Undivided Interest

 This type of land holding is the most recent of all types of ownership. Registered title to the land and building is separated into fractional interests. The size of each interest is determined by the square footage of the apartment. A Buyer's interest has two components - a "land interest" and a "contractual" interest. The "contractual” interest is a contract among all persons who are registered owners of the "land" interests. The registered "land" interest and the contract with the other co-owners define the "bundle" of benefits and obligations which buyers acquire when they purchase an interest.

Take Note:

 Buyers who think they are getting a "deal" when they purchase a co-op, leasehold or undivided interest should investigate further. While you may be able to purchase one of these types of ownership at a far cheaper price than a strata titled property, especially on a square footage basis, the "bundle of rights" you are acquiring is far less. Depending on your area, you may have a great deal of difficulty selling one of these types of properties in the future, especially in a buyer's market. Further, some financial institutions will not finance loans on co-ops or fractional interest holdings. These types of ownership are cheaper for a reason – they are usually less desirable and fewer buyers want them.

New Apartments or Townhouses

 If you should decide that "new" is for you, be aware of the following:

  • GST is either added on to the already inflated price or it is included in the inflated price. In the end, it will be you, the Buyer, who pays for it.


  • Builders write pre-printed "standard" purchase contracts that usually favour them, not you.


  • None of the "kinks" such as leakage or poor quality construction has had the opportunity to become apparent.