After the mortgage, condo fees are the biggest expense of condo ownership. Monthly fees can range from $300 to more than $1,200 depending on the quality of building and suite size.
While lower condo fees are preferable, higher amounts are necessary to live in a nice and well maintained building. There is a cost to providing quality social and working spaces, exercise room, bike cleaning services and pet facilities. Someone needs to clean up common areas, repair damages and fix broken elevators. Fire and security protection systems need to be maintained.
Higher quality buildings, those where keeping everything in working order and maintaining extensive amenities are important, require higher condo fees.
Condo fees are proportional to the size of each owner’s suite. The owner of a 1,200 square foot suite will pay about twice as much as a neighbour in a 600 square foot suite. Balconies, exclusive use common areas, are rarely included in dimension calculations. Parking spaces and storage lockers are included in condo fee calculations.
Condo directors are elected to decide what is covered by condo fees. Virtually everything outside the condo suite door is maintained through condo fees including building repairs, security, legal fees, property management services, patios, balconies and outdoor maintenance.
A portion of condo fees, 20 percent to 50 percent for most condo corporations, is segregated in a reserve fund. This is a legal requirement with funds used to maintain existing building elements. Remaining funds are operational. They can be used to maintain the building or to enhance common areas.
When condo fees are inadequate to pay for maintaining the building, condo directors can implement a special assessment to fund repairs or bring bank balances up to acceptable levels.