There will never be a day when the bills magically stop arriving in your mailbox, but condominium maintenance fees mean less paperwork and writing of cheques.
I had somebody tell me the other day that “maintenance fees are a waste of money.”
Let me explain how that statement makes absolutely no sense at all…
Somebody once said, “Paying maintenance fees at a condo is like paying rent on a house you own. What’s the point?”
Who was this poor, uninformed soul?
Me. A half-decade ago before I got into the real estate business.
I surmised that paying a fee simply for the right to live in a building is similar to what we laymen call “rent.” But I didn’t know the whole truth, or perhaps I did but just wanted to argue for the sake of arguing…
But there are still people out there today that try to argue with me about how maintenance fees are a “rip off” or how you are forced to “overpay.”
When you look on an MLS listing for a condominium, you’ll know what is included in the monthly maintenance fees by the Y’s and N’s next to the utilities, amenities, and features of the building.
Here is a link to a sample MLS listing with attention drawn to the centre column:
Your utilities are Water, Heat (gas bill), Hydro (electric bill), Central Air (included in electricity bill for condos), and Cable TV.
Your other features are your Building Insurance, Common Elements, Parking, and Property Taxes.
Most every condo in the city will include the Water bill in the monthly maintenance fees, and I would estimate that 30-50% of condos include the Heat.
But probably only 25% of condos include the Hydro and Central Air. Fortunately, my condo does, and it’s one less bill (and one less fee!) that I have to worry about. But new condominium developments do NOT include these in the maintenance fees, and I’ve heard rumblings that Toronto Hydro is looking to phase out the inclusion of the Hydro-Electric costs in Toronto condos.
Cable TV is almost never included in the maintenance fees, unless you live at Palace Pier, which is tantamount to living in a hotel.
All condominiums include the Common Elements, or that would kind of defeat the purpose in living in a condo. Building Insurance is also included, which pertains to your individual unit as well.
Parking is included 95% of the time, assuming you own a parking space, however at Merchandise Lofts on Dalhousie, owners pay $51.62/month in additional parking fees even though they own their spots!
Property Taxes are never included, and I don’t know why they even include that option on the MLS listings.
There you have your monthly maintenance fees, and what they pay for.
If you own a house, surely you pay your Heat, Hydro, and Water Bills, and you have House Insurance as well. So if those things are included in your monthly maintenance fees for your condo, what are you complaining about?
Well, people argue that, for example, those fees might add up to $200, but your condo fees are $275.88/month.
“What else am I paying for?”
“Condo fees are a total rip-off!”
This is where people fail to think outside the box.
Think of things you might do around your house, if you owned one, and then think about how those things are done for you at a condo.
When it snows, who do you think shovels the walkway outside your condo? Who salts the icy pavement?
If you have a rooftop patio at your condo, who do you think waters the plants, or puts them there in the first place? Who maintans the BBQ’s or BBQ pits outside?
And how about Mike, Bob, and Fred—those guys that work security downstairs. Do you think they work for free?
When the elevator breaks, does the repair company come and fix it because they like helping people? Where do those costs come from?
And I guess the Toronto Fire Department doesn’t charge a fee when they come to the building a few times a month for false fire alarms, do they?
There are so many expenses that every condominium corporation has, and most people fail to realize it!
Think about the 30th of every month, when people move in and out of the building. Imagine this conversation between Taylor & Tyler, or two other young hipsters: “Okay…turn….yeah…okay…now pivot…..yeah….move your end up a bit….and….(CRASH). Oh dude, I totally just smashed your sofa into the wall.” “Oh don’t worry bro, it’s the friggin’ hallway. Just don’t do that inside my condo!”
Who do you think does all the touch-up painting in the elevators, lobbies, and hallways of your building?
Who vaccuums the carpets in those hallways as well, or mops the lobby every single night?
Do Anna & Sally clean the building for free as well?
How is the mail distributed into the mailboxes?
How about each spring when the pavement in the underground parking garage is power-washed to remove an entire winter’s worth of salt and dirt?
Then there’s the garbage! How often is the chute clogged by lazy people throwing out large cardboard boxes? (guilty!) What about the garbage removal itself?
Think about the world’s most dangerous job: window cleaner. When that guy is hanging from the roof by a pulley and some rope, surely he is being well compensated by your condo corporation!
I could go on and on…..and on, but I’m actually beginning to annoy myself!
Ideally, you do pay MORE than just your utilities each month so the condominium corporation can save up a large amount of money in the Reserve Fund.
If you haven’t heard of a “Reserve Fund,” you’ve been living in a cave on Mars for the past little while.
A “healthy” condominum corporation will have ample money in the reserve fund, and I know of many, many conditional real estate transactions that have been lost because a thorough analysis of a the reserve fund revealed a severe lack of funding.
The whole idea behind the reserve fund is trying to avoid the dreaded “Special Assessment.”
When the roof caves in, and it’s going to cost $400,000 to fix, if the condominium corporation doesn’t have ample money in the reserve fund, you might receive a bill for $1739.13.
Trust me, there is nothing “special” about a Special Assessment.