Toronto’s housing market is as diverse as its people: ranging in price, size, and location. I pick a Toronto listing or trend to focus on each week and review it with a professional's eye. What makes a property a great pick - and what makes it a pass?
ARE YOU BETTER OFF BUYING A FREEHOLD TO ESCAPE PAYING MAINTENANCE FEES?
More home buyers are considering condo style living as an alternative to freehold housing due to the widening price gap between the two types. Although a viable housing choice for many, one gripe that I’ve heard over and over again in relation to condos are the monthly maintenance fees – it’s like throwing your money away. Don’t get me wrong: there are many condos in the Toronto area with unreasonably high maintenance fees due to a variety of factors (e.g., condo corporation mismanagement, unexpected expenses, or lawsuits, etc.) – but these maintenance fees help to run the condo and can actually be similar to the costs you would need to cover for a freehold home.
What are Maintenance Fees Used For?
Maintenance fees are calculated by the condo corporation to ensure they are bringing in enough money to pay for expenses and to keep enough in their reserve fund for future costs (think of this like a savings account for the condo). Maintenance fees differ for each condo corporation – generally with a condo apartment they cover items like heat, water, common areas repair and maintenance (e.g., windows, parking garage, lobby, etc.), and building insurance. Some others even cover things such as hydro and cable, although this is less common.
Maintenance fees also cover things like condo staffing (e.g., security and concierge), maintenance to the amenities (e.g., pool and gym), lawn and garden maintenance and snow removal.
That said, it can be seen that condos with more amenities would typically command a higher maintenance fee in order to cover the ongoing expenses associated with them – which is actually quite similar to a home.