Divided or undivided property, which is better?
| In the condo real estate market, divided or undivided property, which is better? Buying a condo and making it your residence, I don’t really see much of a difference between the two in regarding benefits. You still have neighbours that you have to deal with, however the taxes for the undivided are cheaper. If the neighbour doesn’t pay up for their share though, you are also held responsible. We can pretend they cancel each other out.
There are many differences between the undivided and divided that you should know about if you are planning on buying a condo. Considerable differences like for an undivided you need 25% and can only bank with the Caisse Populaire or the Bank National. There are even notaries who are undivided specific. So do your due diligence and find out the differences. I wrote and article on just that, that you can view: The Difference Between Divided & Undivided
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| PROPERTY TYPE | AVG PRICE | MIN/MAX $ | AVG DAYS ON |
|---|---|---|---|
| 74 Divided Sold | $226,778 | $78,500-$490,000 | 78 days on market |
| 39 Undivided Sold | $259,763 | $155,000-$380,000 | 54 days on market |
Working in real estate is my passion. If you would like me to work for you? Call me at 514-402-8444 or jenn@montreal-realestate.ca
Comment by Emre
Hello Jennifer,
You have a great website, very useful information!
I was wondering if it is a huge disadvantage buying an undivided property since you have to get your mortgage from a specific bank. You cannot shop it around. What if the bank asks for a ridicilous rate if you want to renew your mortgage after 5 years?
Thanks,
Emre
Posted on February 5, 2009 at 7:23 pm
Comment by Emre
Hello Jennifer,
As far as I am concerned, an owner is not responsible if another owner does not pay the taxes. Please correct me if I’m wrong.
Thanks,
Emre
Posted on February 5, 2009 at 7:26 pm
Comment by Jennifer Walker
Yes you are correct in assuming that you won’t be able to shop around. Normally the rates tend to be a couple of points higher. I necessarily don’t know if it’s a huge disadvantage if you find your dream home. There are also some financial saving benefits like saving a bit more on the property taxes. When it comes time to renew and the bank is asking a ridiculous rate, you could always go to the other bank (National or Desjardins) if your co-owner agrees. Or another option would be to get together and turn your building into a divided condo!
Posted on March 9, 2009 at 1:32 pm
Comment by Jennifer Walker
yes
Posted on April 16, 2010 at 5:14 am