August 2024
I help with writing our condo’s quarterly newsletter and seek to know more about the financial challenges caused by increasing costs of labour, material and interest rates.
I would be interested to learn how other condominiums are dealing with the increased costs. It is difficult for condo boards to keep costs under control and avoid excessive fee increases. What measures are or can be taken to deal with these costs including keeping our residents well informed?
Can you advise if there were any news items related to the current financial challenge?
I. E.
Response from Toronto Condo News
Wow – what you ask is a tall order. We have published so many articles on this topic that it is difficult to suggest just a few.
No doubt that many condominium corporations are struggling to address these same questions you pose. Communities that have begun addressing these concerns are in a stronger position than those that quietly bear these costs without preparing their finances for what appear to be permanently higher costs.
Toronto Condo News addressed many of these concerns in a series of articles during the first half of 2023. Practically speaking, the only options are to increase condo fees to pay these higher expenses, make efforts to improve efficiency so that more can be done with less, or reduce expenditures which means degradation in service or maintenance which leads to future problems that will likely be even more expensive to address.
Communities failing to recognize the new cost structure in their budget will have greater challenges, prolonged internal conflict and difficulty in paying bills. Opportunities to identify cost savings and where waste can be trimmed will be missed.
Here are a select few articles that present an overview of the topic.
- Condo Fee Increases in 2023 – Lessons from 2022
- Insurance Crisis in Condoland – Part 2
- Special Assessment – Consider the Alternatives
- Practices to Reduce Insurance Costs
- Reserve Fund Adequacy
- Time to Pay Up
- Catching Up with Inflation
- Business of Condo Business
You have taken an important step in trying to understand the extent of this challenge. At some point, your board will have to make some hard decisions that will impact your community for years to come. Ignoring this reality is ill-advised.
Best of luck.
