Thinking about converting your TIC into a condo? The wait is almost over.
The Condo Conversion Lottery is back! This is great news for TIC (Tenancy in Common) owners and buyers looking to take advantage of this new window of opportunity to make a great return.
If you own a TIC in a three- or four-unit building, your ten-year waiting period is almost up. For TIC owners in a two-unit building, there are no changes to the fast-track condo conversion process. You can breathe easily.
Starting in February 2024, the lottery for three- and four-unit buildings is expected to return. That might seem a long way off, but it’s good to start planning now. Remember, there are owner occupancy requirements to be eligible to convert. The biggest of these requirements is that a majority of units must be owner-occupied as their primary residence. This must be continuous for at least one year before you can even start the application process.
"There Are No Changes to the Fast-track Condo Conversion Process."
The application process is pretty involved, can cost anywhere from $35,000 to $40,000, and takes about a year to complete. It’s a somewhat lengthy process involving the Department of Public Works and a lot of paperwork. Once you are through with it, however, you’ll have your own condo. Not only are condos a simpler form of ownership, they typically trade for a higher value than TICs; often for between 10% and 20% more.
The best time to sell a recently converted condo is right after the process is completed. It’s when buyers are assured that the city has been through the property with a fine-tooth comb, verified permits, and certified code compliance.
It’s a hassle for property owners, but it’s almost always worth it. Be sure to consult an attorney on the process, as there may be additional complexities involved.
If you have a TIC and are interested in learning more, or if you are interested in buying a TIC at a more cost-effective price and converting it in the next few years, give me a call. I specialize in TICs and have even completed a condo conversion for my own property. I’m always happy to help.
