3. Condo shopping: What does the maintenance fee include?
When shopping for condominiums in Toronto, a lot of my buyer clients wonder why they have to pay maintenance fees and what the maintenance fees include. Condo lifestyle is for some and not for others. Some don’t think that paying a maintenance fee is worth living in a condo, while some like the lifestyle of not having to mow the lawn, shovel the snow, doing repairs, etc. The luxury of having amenities in the condo appeal to many who live an active lifestyle with having a private gym, entertaining family/friends in the media or party rooms, convenience of being within walking distance to other amenities in the area is also a reason why people don’t mind paying maintenance fees. A new way of measuring the convenience or location of a building/house, people turn to Walk Score to see how convenient it is to walk to amenities in the area. In recent months, we have seen the majority of resales in the GTA happen with condominiums. Toronto is developing the downtown area to be more family oriented (by trying to phase out the entertainment district), revive old commercial areas and redevelop areas that aren’t appealing to live (Regent Park revitalization). Believe it or not, condos are the most popular purchase for first time home buyers (perhaps because of the price point), and the active lifestyle of being downtown Toronto. There are new projects starting in Toronto all the time, the demand is there and the city is permitting it as the Asian investors are also pouring into the sound Toronto real estate market.
Maintenance fees include Building insurance, water, common element fees, heat, some may or may not include hydro, cable TV, central air conditioning, Parking costs, etc. You should note that the maintenance fees do NOT include property taxes.
For the price you’re paying to live downtown Toronto, is it worth the amount you have to pay to live there? For the same price, you can get a nice townhouse in the suburbs. Perhaps if you’re working downtown, you can save by not having a car? The bulk of the maintenance fees are for the common elements which is used to pay for the concierge, common areas, upkeep, lighting, parking, and repairs. Every payment you make, a chunk of it goes into the ‘reserve fund’, which is used to do major renovations to the building when the need arises. Should the air conditioner break down, that’s where they draw the funds from. Or if the windows need to be done in the entire building, that’s where they get the money from. The reserve fund is accumulated throughout the year by each and every unit paying towards it. You might notice that newer condo buildings will have lower maintenance fees (per month) and older buildings will have higher maintenance fees. If a building has to do major renovations and the reserve fund is lacking in funds, the condominium corporation might have to raise maintenance fees in order for them to raise the necessary funds to cover those costs.
Again, it’s all a personal choice in lifestyle that you can’t necessarily get with a detached home in the suburbs. Living the life downtown in a condo is a lifestyle that is ‘Innate’ to some of us.