Posted 1.19.13 @ 11:50
It’s important to understand your maintenance fees before you buy a luxury condo in Oakville – if you’re paying a lot for a unit only to turn around and pay the same in rent plus a mortgage every month, it may be all wrong for you. Here we’re going to explain how maintenance fees work and what impact they’re going to have on your purchase decisions.
How Fees Work
It’s important to first note that a co-op and a condo are TWO different things. You do not have co-ownership of the building, you only own the interior of your unit and you’re going to be responsible for what happens in your unit. When you pay fees you’re going to usually cover the following things (but each condo is different so check with the developer):
Common Area Electric – have an elevator in your building? Lights in the hallway and lobby? Anywhere with common access to residents will have power running through it and you’ll have to pay a small portion of that.
Building Amenities – every building will have different amenities it offers, and it’s important to take note of what these are. The more and better the amenities the higher your monthly maintenance fees are going to be. If you have a fitness gym, pool access, onsite parking, and other amenities that got you to buy this piece of real estate, your monthly fees are going to this.
Master Insurance Policy – the condo will cover the STRUCTURE of your building, but you are responsible for your INTERIOR. If you’re looking at a condo remember to pick up some condo or renters insurance before you move in. Part of your fees will cover the structure each month.
Property Management Fees – these are there so you have maintenance on site, someone to keep the snow off the main paths and keep things running smoothly.
Water – Common water, just like electricity. You’ll need to pay your small part each month and this is factored into your maintenance fees.
Reserve Fund – if something bad happens or if they want to put in a new pool or something, the reserve fund is there to help cover costs. A condo’s reserve fund should be flush before you move in.
Each building will have specific fees associated with maintenance – if you’re in Ontario you’ll have 10 days from the time the developer gives you the information to cancel the deal. You won’t be able to do this on anything but a condo, so it’s important to have a real estate lawyer or agent take a look at what you’re thinking about signing before you sign it.
Your maintenance fees shouldn’t total more than your monthly mortgage payment. If they do, you’ll want to look at how much you’re paying for your mortgage and if this condo is really worth the high fees. Don’t be afraid to take your time and shop around, explore your options before you settle on the one that’s right for you.