For those that are condominium owners, you may have decided to own the home that you do because of its size, its proximity to the city, or perhaps not having to deal with the maintenance of a larger house. However, there are some extra fees involved with owning a condo that can be confusing for some owners. Nevermind having to review the condo documents We’ll try to break down those monthly fees to give you a better picture of what you’re paying for.
Whereas rent is generally calculated for the investor to make a profit, maintenance fees are inherently not for-profit. They are calculated by taking the cost of running the building as a whole, and then depending on the size of your condo, the percentage of space you take up out of the whole building corresponding to the cost of running the building is the fee that you will pay monthly for maintenance. However, these fees may change year by year according to the building’s annual operating budget.
They Cover Necessities
Depending on the layout of your condo (for example townhouses will often have separate utility meters), the maintenance fees may be covering your utilities, such as water, gas, and electric. Not only that, but the fees will also include things like window cleaning, snow shovelling, housecleaning, gardening, and other necessities. These types of services may be part of the reason you decided to live in a condo, as it can be wonderful to not have to deal with them yourself.
Every condo must maintain by law some money set aside, which contributes to your monthly fee, known as a contingency fee. This money set aside can be used for any special costs that occur, or any emergencies as well. For example, if the building needed a new roof, or if there were special repairs needed for the heating, this money would come from the contingency fee. Although this may seem as though it’s another expense out of the many you pay for your condo, in reality the contingency fee is keeping you safe and allowing you to have peace of mind if anything were to happen, and that you would know there are resources available to fix the problems as soon as possible.
Overall, owning a condo can be a great investment, especially if it’s an area that is getting a lot of attention from other investors. However, knowing about what you pay every month and where it goes will help to eradicate any confusion you have, and allow you to enjoy your home!
This post was written by the fine folks at Condo 411 Calgary.