Condo Fees: What They Cover (And What They Don’t)
When it comes to understanding condo fees, it’s important for condo owners to do their research. All Alberta condo owners are required to pay condo fees. These fees cover a variety of expenses that you incur as a property owner. The exact amount of the fees varies, depending on how much property you own.
Additionally, condo owners can expect the fees to change year to year, typically going up to adjust for inflation. Being prepared to cover the cost of your monthly fees, as well as knowing what expenses you’ll need to pay on top of these fees, will make your financial situation simpler in the long run.
Cost differences can arise between apartment-style condos and townhomes. For example, apartment-style condos often have Homeowners Association fees included, which can amount to an average of $100 every month.
Townhomes don’t typically have HOA fees, meaning you may save money on fees each month. Importantly, however, townhomes are usually more expensive on the front end. Due to the varying nature of each condo owner’s situation, it’s essential to invest time in understanding condo fees before purchasing a property. This way, you’ll be fully aware of which costs you’re responsible for.
It’s common for condo owners to wonder, “What do condo fees cover?” We’ve developed this guide to help address some of the most common applications of condo fees, while also informing you of what you shouldn’t expect your fees to contribute towards.
Here Is a List of Things Condo Fees Do and Don’t Cover
1. Condominium Fees Do Cover Maintenance Issues
When you pay condo fees, you can expect them to go towards the maintenance of exterior areas, including painting the outside of the property, cleaning the windows, and maintaining the landscaped areas to keep the complex looking its best.
Apartment-style condo fees typically contribute to the maintenance of interior areas as well, which can range from space that include:
- Indoor Pools
- Recreation Areas
2. Condo Fees Do Go Towards Amenities
An important detail for Alberta condo owners to note is that you’ll also pay condominium fees for simply having access to certain amenities. The amenities will vary between condominium complexes can even vary from building to building. Examples include indoor theatres, sports courts, and other common areas available to owners.
Typically, you’ll be required to pay the extra fees associated with the amenities, even if you choose not to use them. Occasionally, a condo owner may be able to opt out of certain amenities fees, so it’s important to understand which ones you are paying for.
3. Property Taxes are Not Included in Condo Fees
Another essential point for fully understanding condo fees is the fact that your property taxes are not included in these monthly condo fees, as these fees go directly towards the building’s managers.
Your property taxes are determined by your municipality, not the management company itself. However, you may be able to deduct a portion of the condo fees when filing your taxes each year. For the most accurate understanding of your tax situation, you’ll want to discuss your condo situation with your accountant.
4. Alberta Condo Owners’s Fees Do Cover Utilities
It’s not unusual for condo fees to also cover the cost of the buildings’ utilities, including water, hydro (electricity), and heating. However, in recent years, some of the utility systems have begun to change, and you may find that the utilities you’re expected to pay has changed.
Notably, newer condos sometimes have their own heat pumps which each condo owner maintains themselves. Thus, the associated costs with heating in this situation would not be included in your condo fees, as your management company would have nothing to do with this heating system.
Other utility fees that owners can expect to be included in their monthly condo fees are costs associated with garbage collection and sometimes even cable television access. Read all of the paperwork thoroughly before purchasing a property so that you’re aware of the fine print.
5. Condo Fees Do Contribute to a “Savings” Fund
A portion of your fees will go towards a savings fund (i.e., reserve fund) held by your condo’s management company. These fees are used, along with those of other condo owners, to perform any emergency work.
Viewing the certificate to assess the condo’s status can help prepare you for future increases in your condo fees, including the portion going towards the reserve fund. While there is typically a fee associated with obtaining the condo status certificate, it can help better inform you of the property’s condition.
Are you a resident at a Catalyst Condo Management property? Do you own a unit and have questions about condo fees? Contact us directly. We’re always happy to help answer questions!