What are Condo Fees?
Many first time condo buyers are confused by monthly condo maintence fees.
Condo maintenance fees are a percentage of the buyer's share of costs for the operating and upkeep of the building. Each condo is registered as a non-profit corporation, maintenace fees are also reffered to as common expenses and are the fees that you pay on a monthly basis to cove the exepenses that relate to all the condominium expenditures such as maitenance and repair costs, management fees, insurance, legal and accounting expenses and a contribution to the reserve fund ( the fund set aside to cover future major repair sand replacements for the building).
The items that are included in maintenance fees are all set out in an annual budget that is prepared by the board of directors of the condominium corporation. It is important to see what items are included in this monthly fee. For example, the unit that you may consider purchasing, may be separately metered for utilities and therefore, this amount would be paid by you directly to the utility company and would not form part of the monthly maintenance fee.
What does each condominium owner pay?
Each condominium owner pays a percentage of the budget which is determined right from the outset when the condominium is created. The "declaration" sets out the percentage of maintenance fees that apply to each residential unit, parking unit and locker unit. The percentages are determined by the developer and often are based on square footage of the unit but do not have to be. It may be that units on the higher floors pay higher maintenance fee or it may be that all units pay the same percentage.
the misconception that I hear most often is buyers not wanting to pay condo fee. wHAT IS NOT UNDERSTOOD IS THAT THESE FEES ARE RELATIVE OR EVEN LOWER THAN WHAT A HOME OWNER WOULD PAY MONLY TO MAINTAIN THEIR PROPERTY.