Understanding Special Levies on Condos in Alberta
When you buy a condominium in Alberta, you’re not just purchasing a living space—you’re also buying into a shared property with common areas and collective financial responsibilities. While most condo owners are familiar with regular monthly condo fees, special levies can come as an unexpected financial burden. As a licensed Calgary REALTOR® with over two decades of experience, I often get asked, “What exactly is a special levy?” This blog will break it down and help you understand how special levies work, what triggers them, and what rights you have as a condo owner in Alberta.
What Is a Special Levy?
A special levy is a one-time or short-term financial contribution imposed on condo unit owners by the condominium corporation. It is typically charged in addition to your regular condo fees and is used to cover unexpected or underfunded expenses related to the upkeep, repair, or replacement of common property.
Unlike monthly fees, which go toward day-to-day maintenance and contributions to the reserve fund, special levies are often levied when reserve funds fall short or when unforeseen repairs arise.
Legal Definition in Alberta
Under Alberta’s Condominium Property Act, a special levy is permitted if:
- The board of directors passes a resolution.
- The amount is necessary for major repairs or replacements.
- The expense is either not covered, or only partially covered, by the reserve fund.
- Owners are notified with a clear explanation and a due date.
Why Are Special Levies Issued?
1. Emergency Repairs
- Unexpected roof collapse
- Major water line break
- Sudden HVAC failure in common areas
2. Reserve Fund Shortfalls
Sometimes, a reserve fund study underestimates future costs or the condo board delays contributing the right amounts. When the reserve fund can’t cover the cost, a special levy is used.
3. Upgrades Voted by the Board or Owners
Sometimes, owners vote for enhancements that aren’t critical but improve the value or function of the building:
- New security systems
- Upgraded elevator systems
- Exterior facelifts
These may be partially or wholly funded through special assessments.
How Are Special Levies Calculated?
Special levies are typically calculated based on unit factors, which are proportional to the size or value of your condo unit relative to the whole complex.
For example:
If the condo board imposes a $100,000 levy for roof repairs, and your unit has 1.5% of the total unit factors, your share would be $1,500.
Payment options may include:
- Lump-sum payment by a deadline
- Scheduled installment payments (subject to board approval)
How Will You Know If a Special Levy Is Coming?
- Board Meeting Notices: Owners should receive written notices about upcoming board meetings where the special levy will be discussed or voted on.
- Official Notice of Special Levy: This will include:
- The amount being levied
- Reason for the levy
- Your individual share
- Due date or payment schedule
- Reserve Fund Study and Budget Reports: Reviewing the reserve fund plan during your purchase process or AGM (Annual General Meeting) can help you anticipate potential future levies.
What Are Your Rights as a Condo Owner?
Review Financials Before Buying
As a buyer, always request the following before purchasing a condo:
- Latest reserve fund study
- Financial statements
- Minutes of recent condo board meetings
- Information on planned or proposed special levies
Dispute or Appeal Options
You can’t directly “refuse” to pay a special levy once it’s properly levied, but if:
- There’s mismanagement, or
- The levy wasn’t legally imposed,
You may file a complaint with the Condominium Dispute Resolution Tribunal or seek legal counsel.
How Special Levies Impact Buying and Selling
For Buyers:
A special levy coming up can increase your short-term costs. You can negotiate:
- A price reduction, or
- Ask the seller to cover the levy as part of the sale.
For Sellers:
If a levy has been announced or paid, be transparent. You may highlight that the major work has already been funded and completed, which can boost buyer confidence.
Can You Insure Against Special Levies?
Unfortunately, home insurance does not cover special levies. However, a few companies offer optional “special assessment coverage” as an endorsement under specific conditions. Speak to an Alberta-licensed insurance advisor to explore options.
How to Avoid Surprises: Tips from a Calgary Real Estate Expert
- Always Work with an Experienced REALTOR®:When representing condo buyers, I help my clients:
- Interpret condo documents
- Evaluate financial risks
- Understand building history and governance
- Connect with condo document review services
- Ask These Key Questions:
- Is there a healthy reserve fund?
- Have there been recent or frequent special levies?
- Are there upcoming major projects?
- How old is the building infrastructure?
Final Thoughts: Be Informed, Not Surprised
Special levies are a normal part of condo ownership, but they don’t have to be a financial shock. Being informed, asking the right questions, and working with an experienced real estate professional can make all the difference.
If you’re considering buying or selling a condo in Calgary or surrounding areas, I’d be happy to help you review the risks and make a confident, well-informed move.
About the Author
Malvinder S. Tiwana
Tiwana Real Estate Team | Grand Realty
📍 Serving Calgary and Area Since 2003
🌐 www.maltiwana.ca
