As condominiums become an increasingly popular choice among Canadian
homebuyers — from first-time purchasers to downsizing empty-nesters — questions
about condo fees are top of mind for many. Here’s everything you need to know
about condo fees, how they’re calculated, what they cover, and how they fit
into the broader costs of condo ownership.
What Are Condo Fees?
Condo fees are mandatory payments made by condo owners to cover the
shared costs of operating and maintaining the condominium building and its
amenities. These fees are calculated based on the size of your unit as a
percentage of the entire building. The larger your condo unit, the higher your
share of the fees. Condo fees are adjusted annually based on the condominium’s
operating budget and are non-negotiable.
Divided vs. Undivided Co-Ownership
·
Divided Co-Ownership: This is the most
common type of condo ownership. The building is divided into private areas
(your unit, parking space, storage) and common areas (hallways, amenities). As
the sole owner of your private space, you also co-own the common areas with
other residents. Divided co-ownership units typically require a down payment of
at least 5%.
·
Undivided Co-Ownership: The building is
treated as one property, and you own a share of it. This type of ownership
requires a higher down payment (usually 20%) and often includes monthly or
annual fees for maintenance and repairs. It offers more flexible administration
but is less common.
What Do Condo Fees Cover?
Condo fees typically fall into three main categories:
1. Utilities
A portion of condo fees may cover utilities such as water, gas, hydro,
and heat. However, newer condominiums often have individually metered units
where owners pay for utilities separately.
2. Common Areas and Amenities
Fees go toward maintaining shared spaces and amenities, which may
include:
·
Hallways, elevators, and lobbies
·
Fitness centers, swimming pools, and rooftop gardens
·
Snow and garbage removal
·
Landscaping and exterior maintenance
·
Cleaning and minor repairs
The more amenities your condo has, the higher the fees. Even if you
rarely use these amenities, you’re required to contribute to their upkeep.
3. Reserve Fund
Every condo board must maintain a reserve fund — a savings account for
significant repairs and maintenance, such as roof replacements or parking lot
resurfacing. This fund is essential for covering both planned and emergency
expenses.
If the reserve fund is insufficient to cover a major expense, owners may
be required to pay a “Special Assessment,” an additional fee proportional to
their unit size.
Administrative Costs
Condo fees also cover administrative costs for property management,
insurance for the building, and salaries for staff, such as concierge or
security personnel.
How Are Condo Fees Calculated?
Several factors influence the amount of your condo fees, including:
·
The size and age of the building
·
The number and type of amenities
·
The number of units sharing the costs
Fees can range from $50 to $1,000+ per month. Be cautious of unusually
low fees, as they may indicate underfunded maintenance or reserve funds.
Do Condo Owners Pay Property Taxes?
Yes, condo owners pay property taxes separately from their condo fees.
Property taxes are determined by the local government and are based on a
percentage of your condo’s assessed value. For example:
Toronto: 0.72% of the assessed value
Vancouver: 0.28% of the assessed value
These taxes fund local infrastructure and services, such as schools,
roads, garbage collection, and emergency services.
Condo Townhouses and Condo Fees
Townhouses can also have condo fees if they are part of a condominium
corporation. These fees cover shared services like landscaping, snow removal,
and maintenance of shared driveways or parking areas.
Key Considerations Before Buying a Condo
1.
Budgeting for Fees: Include condo fees in
your monthly budget and leave room for potential increases, which are often
necessary as buildings age.
2.
Review the Status Certificate: Before purchasing,
obtain the condo’s Status Certificate. This document provides insight into the
building’s financial health, reserve fund, current fees, and any planned fee
increases. The fee for the certificate is typically around $100.
3.
Understand Your Responsibilities: Condo fees don’t
cover everything. You’ll still need to budget for mortgage payments, property
taxes, and homeowner’s insurance.
The Bottom Line
Condo fees are essential for maintaining the quality and value of your
property, offering convenience, and ensuring a comfortable lifestyle. By
understanding what these fees cover and how they’re calculated, you can make an
informed decision when choosing your next home.
Ready to start your condo search? Connect with an experienced RE/MAX President agent today and find
the perfect property for your lifestyle and budget!
