A common question people ask is regarding the monthly condo fees and what exactly the fee is paying for. To start, the fee is to pay for your share of the building... or your share of the common expenses.
Your share is decided based on your percentage of ownership in the building or square footage of the overall building. In a highrise, it can be as little as .3% (or even less), however in a small lowrise that percentage could much higher. This would also increase if you have a parking spot and locker. Keep in mind that (typically, in most buildings) balconies or terraces are not used to determine ownership - you don't pay for the square footage of your balcony or terrace. They are referred to as exclusive common elements. You don't own them like the condo unit, instead, you have exclusive rights to use them.
Common expenses can include:
- garbage collection
- snow removal
- water charges
- electricity for the common elements (hallways, parking garages, etc)
- natural gas heating for the common elements
- natural gas heating for the boiler tanks that supply heating to the units
- building insurance
- professional property management
- audit, legal, and professional expenses (lawyer, accountant, etc.)
- the maintenance, repair, and replacement of the common element components (this is and can be a big one - since this includes the building structure, elevators, windows, etc.) this also includes the amenities and equipment (gym equipment, bbq, pool, etc.)
- the cost of borrowing money (if a repair is needed that can't be covered by the reserve fund, the Corporation needs to borrow money)
- any remuneration payable to employees (superintendent, security, concierge, etc).
Every year Ottawa condo owners receive a breakdown of the expenses, and how the monthly condo fee was allocated and is projected to be spent. It is easy to ignore the document as it is long and dry, but important to look over and pay attention to how the money is being spent.
Often I explain it as living in a condo provides a luxury that is impossible to match in a residential house at the same price point. Underground heated parking, an elevator, a concierge, gym, party room, no landscaping such as snow removal or lawn cutting, and no taking out the trash - just send it down a chute.
Have a question about condo living or buying a condo? Let's chat.