What are these maintenance fees, and are they worth it?!

Maintenance Fees

When first looking at maintenance fees of a condo building, they can seem irrelevant, and just another living cost that would not be present if purchasing a freehold home. As we delve further into what maintenance fees consist of, this thought should diminish, and the benefits should become clear. 

One of the biggest components of the maintenance fees are the various utility bills, such as: Water, heat, air-conditioning, hydro - depending on what is included in the particular condo building. When purchasing a condo- whether it be resale, or pre-construction- you will know what is included in the maintenance fee of your unit prior to submitting an offer to purchase. Many condo buildings will include the maintenance of a parking space and a locker in the monthly fees. Regardless of purchasing a home with maintenance fees associated, or a home without, the utilities and maintenance of the parking area is necessary and would be an additional cost. In a freehold home these bills might not come in one lump sum but they will be required to be paid in individual bills and at equally competitive rates to the amount allocated within a maintenance fee.

When comparing the utility costs in a condo and a home it can be disputed that the amount paid within the maintenance fee still outweighs what a home owner is paying. Although this may appear so, there are many services that are taken care of within the maintenance fee in a condo that would be an additional charge in a home. In a condo sidewalks are plowed and iced when it snows, plants are watered around the premises and kept healthy, a concierge is paid, monthly fire testing is performed, repairs around the building such as painting walls, touch ups, vacuuming carpets each night, cleaning the building, window cleaning, garbage shoot cleaning and many more are all covered. Most of these services would be paid out of pocket or be an additional performed task within a home. We have not even touched upon the amenities that many condo buildings offer, and are included for the benefit of the condo residence. The costs for maintaining a pool, gym, bowling alley, etc. would also be covered in the buildings maintenance fee. 

Your maintenance fee also contributes towards the Reserve Fund that the condo has so that when something requires repair, the condo has finances to allocate to fix various issues. If the Reserve Fund is not able to maintenance a certain balance and major repair is required within the building, a special assessment would be necessary. If the roof of the condo gives out and the cost is $500,000 to repair it, without enough money in the Reserve Fund residents are likely to receive a bill that is required to be paid out of pocket to help contribute to the repair. It is important to keep in mind that you are paying a certain maintenance fee that is dependent on the square footage of your unit. You will not be paying the same fee for a one bedroom condo as someone else would be paying for a two bedroom.

Overall maintenance fees are used to pay some of your direct bills but they also are what keeps the building running properly, and will prevent higher maintenance fees in the future if managed properly. Before jumping to the conclusion that the maintenance fee you are paying is too high, or unjustified, it is important to consider and understand what the fee is actually contributing too, and what you may have overlooked that would not be present without it. 

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