Condo Maintenance Fees: What Are You Really Paying For?
If you are looking to buy a condo, you’ve likely heard of the term “condo maintenance fees”, as they are a significant expense for condo owners. These fees are a crucial part of ensuring the condo operates smoothly and the building is being maintained well for the long haul.
But what exactly do these fees cover? It’s important to understand where your hard earned money is being used towards – let’s break this down.
What Are Condo Maintenance Fees?
In simple terms, condo maintenance fees are monthly payments made by condo owners to cover the costs of maintaining and managing the condominium property.
The maintenance fees vary depending on the square footage of the unit, parking, building size, amenities, age, and even the number of units contributing to the fund.
What Do Condo Fees Cover?
While the specifics may vary by building, maintenance fees generally cover the following:
1. Utilities
Many condos include some utilities such as water, heat, and hydro within the maintenance fees. Some buildings even cover internet and cable services – we have been seeing this more in new condos as developers are building tech advanced condos.
2. Common Area Maintenance
This includes cleaning, repairs, and upkeep of shared spaces like lobbies, hallways, elevators, swimming pools and other recreational areas. Landscaping, snow removal, and garbage disposal services are also typically included.
3. Building Repairs and Upkeep
Structural maintenance, roofing repairs, HVAC systems, and exterior maintenance fall under this category. Regular inspections and preventive maintenance help keep the building in good shape.
4. Security and Concierge Services
If the condo has security and concierge staff, or controlled entry systems, a portion of the fees goes toward these services to ensure resident safety.
5. Recreational Amenities
Many condo buildings offer amenities like gyms, swimming pools, party rooms, and outdoor lounges with bbqs. The maintenance, staffing, and upkeep of these facilities are included in the fees.
6. Reserve Fund Contributions
A portion of the fees is allocated to the condo’s reserve fund, which is used for long-term repairs and unexpected expenses, such as replacing an aging roof, floods, or upgrading HVAC systems.
The ‘Status Certificate’ is a comprehensive report detailing the condo corporations reserve fund and financial health. We always recommend to hire a lawyer to review the status certificate of the condo to ensure there are no liens or financial concerns that can lead to a risky long-term investment.
7. Management and Administrative Costs
Condo corporations often hire professional management companies to handle finances, legal matters, resident communications, and general operations. These administrative costs are covered by maintenance fees.
Why Do Fees Vary?
Several factors impact condo maintenance fees, including:
- The age and condition of the building – Note: older condo buildings don’t always mean higher fees as some aged buildings are very well maintained.
- The number and type of amenities offered
- The efficiency of the condo board in managing expenses
- The size of the unit (fees are often calculated per square foot)
Can Condo Fees Increase?
Yes, condo maintenance fees can increase over time due to rising utility costs, inflation, and unexpected repairs. Before purchasing the condo, it’s crucial to get the condo’s financial statements and reserve fund reviewed by a lawyer to obtain insight on the condo’s financial standings and any potential increases.
When searching for a condo for sale, before taking the time to see the unit, make sure you are aware of the maintenance fees as they are a significant detail you will need to budget in.
While condo maintenance fees might seem like a financial burden, this expense is what allows owners to enjoy the major perks of convenience in condo living.
Are you considering purchasing a condo and want to understand maintenance fees better? Reach out, and we’d be happy to help!