Deferred Maintenance

Understand deferred maintenance in Canadian real estate — what it is, why it matters, and how it impacts property value and costs.

Deferred Maintenance

August 08, 2025


What is Deferred Maintenance?

Deferred maintenance refers to necessary repairs or upkeep that have been postponed, often due to budget constraints or neglect.

Why Deferred Maintenance Matters in Real Estate

In Canadian property management, deferred maintenance can lead to higher long-term costs, reduced property value, and safety issues.



Examples:
  • Roof leaks left unaddressed
  • Aging HVAC systems not replaced
  • Structural repairs deferred beyond recommended timelines



Identifying deferred maintenance is critical during property inspections and valuations.

Example of Deferred Maintenance in Action

The buyer negotiated a lower purchase price after discovering extensive deferred maintenance issues during the inspection.

Key Takeaways

  • Delayed repairs or maintenance tasks
  • Can reduce property value and increase costs
  • Common in underfunded capital reserve situations
  • Identified during due diligence inspections
  • Addressing promptly protects asset value

Related Terms

Additional Terms

Recourse Loan

A recourse loan is a type of loan where the lender can pursue the borrower’s personal assets, beyond the collateral, in the event of default.. more

Pari Passu

A pari passu clause is a contractual provision ensuring that multiple creditors share equally in repayment priority from the borrower’s assets.. more

Non-Recourse Loan

A non-recourse loan is a type of loan where the lender’s only remedy in case of default is to seize the collateral property; the borrower is not. more

Net Operating Income

Net operating income (NOI) is the total income generated by a property after operating expenses are deducted but before taxes and financing costs.. more

Mechanic's Lien

A mechanic’s lien is a legal claim by a contractor, subcontractor, or supplier for unpaid work or materials provided for a property.. more

Lis Pendens

Lis pendens is a legal notice filed in the land registry indicating that a property is subject to ongoing litigation that may affect its title.. more

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