Are you thinking about buying a condo in the future? Do you have concerns or have
any questions relating to condo fees? Finding all this information out can be
difficult especially with all the other decisions you have to make with this
major purchase. In this video we'll talk about all the major questions that
customers have about condos so you'll be
better prepared with your next condo purchase.
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Hi everyone, welcome to another edition of Homebuyer's School.
Today I'm joined by Karen McDonald,
community manager with Brookfield Residential, and today the
question we're gonna answer is, what's the risk of condo fees going up? In fact
this is part two of our two-part series on condo fees and so we have a whole
bunch of questions today. But I guess that's the number one question that
you're always asking is like how often does it go up?
Well condo fees I would say in general can go up on a yearly basis,
we don't see a lot of the times where they go up more than on a yearly basis
cause' they're assessed on that yearly basis. I would say that it would be
something that new homebuyers should take into consideration that they'll likely
go up within a year--two years time to the degree which they will all depends on
whether you're buying a new build, resale, whether it's an older building
whether there's going to be any kind of immediate maintenance that needs to be
done. In a new build you're relatively taken care of as far as your warranties
go that you shouldn't have any kind of huge increases over the first number of
years.
So who exactly decides how the condo fees increase or decrease--
I don't think they've ever seen a decrease but--
No.
But how--who decides that?
The management board ultimately, they are who the homeowners
employ to manage that, to take care of the operating expenses, to take a look
at the budget and ensure that there's enough allocated towards the reserve
fund, and maintenance, and repair, and
landscaping, snow removal contracts so it is the management board that really
takes care of the management company that takes care of all of that.
Homeowners board would be consulted on a regular basis.
Can you ever tell the management company don't want
any increases this year?
No, not if you want to
ensure that you're still maintaining the value of your property in the common
area, it is something that is mandatory that you pay, that's what you sign up for
when you buy a multi-family home.
So let's say your condo--your board
wants to build, let's say a new rec facility inside the condo right, that
obviously impacts the management company, impacts your fees.
Absolutely it will. Anything that the--
really would be the homeowner's board that would decide if they want to have a
additional recreation facility built, that would be a huge expense that--
homeowners board will ultimately make the decision whether everybody will
be responsible for that additional expense on a monthly basis, maintenance
upkeep, everything.
Is there a, I guess a set fee or a minimum fee in Alberta?
No, no there's not. It really just depends on what amount of
unit factor shares each home has based on registered square meters.
Is there an average that you found in the past, of like an average condo fee or
is it just, it depends on the multifamily?
It really depends on what type of multi-family
home you have. Apartments you know that they're going to include some kind of
utility, they will be higher than say townhomes and where they're just
maintaining the exterior of the building or a bare land where they don't maintain
anything so you're gonna have varying amounts based on whatever type of
multi-family home you're buying.
So is there like a formula that the management company takes into
consideration?
Well it would be based on total registered size of the home and
unit factor shares that are allocated towards each home, now what that
means is that in Alberta, every
multifamily development has 10,000 unit factor
shares and so based on the registered size of the home that would be allocated
accordingly based on that square metered size.
And if you add any square meters
then obviously that would increase right? If you're adding that facility--
Absolutely.
And how often do you pay condo fees?
It would be monthly, on a monthly basis.
Is there any other payment method that you know of or is it just sort
of--is it per owner or kind of like as a collective, you pay the collective and
then you know whether you paid your condo board and then you paid
the management?
You would pay directly per owner to the management company, some people they
can pay a year in advance if that's what they prefer to do. A lot
of the time its direct debit on a monthly basis.
Perfect, do you have anything else to add in terms of condo fees?
I would say overall
that condo fees are good, they are maintaining your investment, they're
insuring that landscaping is done, that everything looks the same, it's cohesive
and you're not having to rely on your neighbor to maintain their property, so
the value of yours is insured so overall condo fees are good. You pay them
regardless whether it's in a single-family home or a multi-family,
just not in a tiny little bundle every month.
Awesome, well thank you very much
Karen. Thank you very much for joining us, remember to view part 1 of
our series on condo fees, it includes what's included in condo fees and other
questions as well, thank you.
That's another edition of
Homebuyer's School.
Tune in next time for more expert tips
and tricks, and visit homebuyersschool.ca
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