Date: May 6, 2024 Source: BC Financial Services Authority BCFSA
Introduction:
The British Columbia Financial Services Authority (BCFSA) has issued an advisory regarding recent amendments to the Strata Property Regulation under the Strata Property Act. These changes aim to enhance the management of strata corporations and ensure long-term financial planning.
Key Amendments:
Depreciation Report Requirements: Strata corporations with five or more lots must now obtain a depreciation report every five years, instead of every three years. This report must be acquired from qualified professionals listed by the regulatory authority.
Funding for Depreciation Reports: Developers establishing new strata corporations after July 1, 2027, with five or more lots, must contribute funding for depreciation reports. This funding ranges from $5,000 plus $200 per strata lot, up to a maximum of $30,000.
Transitional Provisions:
Although these amendments take effect on July 1, 2024, transitional provisions are in place. Existing or new strata corporations have specific deadlines to obtain depreciation reports, as outlined in the Order of the Lieutenant Governor in Council 204 – 2024.
Considerations for Licensees and Developers:
Licensees: Real estate licensees, especially those offering strata management services, should understand these amendments to provide accurate guidance to clients.
Developers: Those filing disclosure statements under the Real Estate Development Marketing Act (REDMA) must ensure compliance with funding requirements for depreciation reports by July 1, 2027.
Effect on Filed Disclosure Statements:
Developers who anticipate completion of development property on or after July 1, 2027, may need to amend existing disclosure statements to reflect the updated funding requirements for depreciation reports.
Additional Resources:
Stakeholders are encouraged to seek legal advice on disclosure requirements, strata budgets, and depreciation reports. Further information is available on the Government of B.C.’s Strata Housing website, BCFSA’s News Release, Strata Property Regulation, and Order of the Lieutenant Governor in Council 204 – 2024.
- Government of B.C.’s Strata Housing website;
- Government of B.C. News Release;
- Strata Property Regulation;
- Order of the Lieutenant Governor in Council 204 – 2024.
Conclusion:
These regulatory amendments aim to improve the management and financial sustainability of strata corporations in British Columbia. Stakeholders are advised to stay informed and seek guidance to ensure compliance with the updated requirements. For any questions or further assistance, contact BCFSA’s Practice Standards Advisors or subscribe to updates on changes to strata legislation.
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