Condo Maintenance Fees
What Do Condo Fees Include?
When purchasing a condo, you will have to pay a mandatory, non-negotiable monthly fee that covers a wide range of expenses. Generally, condo fees (also known as strata fees) will partially cover your utilities, contribute to your reserve fund and pay for maintenance of common areas in the building. Before you finalize your purchase, you should get your realtor and real estate lawyer to find out exactly what is and is not covered in your fees, so you are not surprised by any unexpected bills as a new condo owner.
Typically, your monthly condo fees will at least partially cover your water and hydro, and may or may not also include heat. In older buildings, heat may be centrally controlled; in this case, it's often expensive to run so the total expense is spit evenly amongst all units based on square footage. In newer buildings, units may have their own heat-pump system, whereby owners would pay for their own usage. It's highly unlikely that your condo fees would include any portion of your cable or Internet, but some new buildings do offer promotions to buyers.
Every month, a portion of your condo fees is contributed to the building's reserve fund. The reserve fund is a mandatory fund that all buildings must have, as per the Condominium Act. The fund acts as an emergency savings account for the building and covers replacement and unexpected repairs as needed. Regular maintenence and repairs are covered by the regular budget, which you also contribute to each month.
One thing that is always included in your condo fees is the maintenance and basic operation of your building's common areas. This includes: cleaning of indoor and outdoor common areas, trash removal, snow removal and any repairs to common elements.
How Much Do Condo Fees Cost?
There are many factors that play a role in determining your monthly condo fees, so it's difficult to give an exact calculation or formula for it and even more difficult to come up with an average cost. In Toronto, the average is estimated to be close to $0.50 per square foot but can reach as high as $1.00 or more. Fees in Vancouver, Calgary and Montreal tend to be slightly lower than that.
When you view a condo, you should get a fact sheet that lists both square footage and your monthly condo fees. Simply divide the fees by your square footage to see how much you'll be paying per square foot. For example, $250 per month / 700 square feet = $0.36 per square foot.
The size of the building that your unit belongs to can play a very important factor in the cost of your monthly condo fees. While not always the case, larger buildings tend to have slightly lower monthly fees, as the total costs are split between a larger number of units.
The age of your building may be one of the many factors included in your monthly condo fees. For example, older buildings generally have higher fees because things may break down and need to be fixed or replaced more often. But that's not to say that all new buildings will have low fees; that can often depend on what amenities are included in the building and how expensive it is to maintain everything.
If you're unsure of how old and/or structurally sound your building is, this is where bringing in a home inspector is a good idea. One thing you should absolutely beware of is old buildings with extremely low fees.
While some buildings come with nothing more than a foyer, others come with all the bells and whistles. As expected, though, you have to pay to use those bells and whistles - this is included in your monthly condo fees. Swimming pools, party rooms, valet parking, theatres and yoga rooms are amongst the many luxury amenities currently being offered at various condominiums across Canada. Buildings with these types of amenities obviously charge higher condo fees, not only for usage but to cover the cost of upkeep and operation.
Toronto Condo Fee Comparison1
|Building||Average Condo Fee Per Square Foot||Year Completed||Neighbourhood|
|Residences of the Ritz Carlton||$1.06||2011||King West|
|222 Esplanade||$0.89||1992||St. Lawrence|
|The Shangri-La||$0.80||2012||King West|
|The Modern on Richmond||$0.60||2011||Moss Park|
|The Thompson||$0.60||2010||King West|
|The Vu||$0.59||2011||St Lawrence|
|500 Wellington||$0.56||2012||King West|
|Seventy5 Portland||$0.53||2010||King West|
|Six50 King||$0.48||2012||King West|
Additional Factors to Consider
Most buyers do not realize that their condo fees can go up at any time and by any amount. Condo fees are controlled by the condo board and can be changed at their discretion. If there's a chance that the current monthly fees on a condo you're looking at would stretch your budget, you may want to consider looking at a condo with lower fees - especially because you could face an increase at any time.
The Status Certificate
Every building is required to have a status certificate, which provides essential information concerning the financial stability of the building and the condominium corporation. The content includes things such as the budget, status of the reserve fund, the management contract and any legal battles that the building has faced. Most importantly, it includes the current maintenance fees, and any large fee increases that may be coming into effect in the near future.