Is it normal for fees to double?
Homework before purchase is essential
QWhen I purchased my condo last year the monthly fees were $250. I just received notice that they will be raised to $500 a month. Is this the normal increase for most condominiums in Ontario? I don’t want my fees to exceed my mortgage payments. Is there a cap at some point, or do they just keep increasing forever?
ADoing your homework prior to purchasing a condo is a must.
Unfortunately some buyers never review the most important information regarding the property in question. Instead they see a super updated kitchen, beautifully painted walls, new appliances etc.
They base their decision solely on cosmetic features instead of investigating who is managing this condo? When was the last reserve fund study conducted? How often do the monthly fees increase? Who are the directors and do they live on-site? Is there a list indicating when the last major repairs were completed.
All this information can be found in the status certificate. Some people wonder why the condo fees are so high, or in very rare cases so low. They must realize that one size does not fit all. Each corporation has different expenses. For instance, tennis courts, swimming pools, gyms, sauna, whirlpool tub and other amenities require very high maintenance costs.
There is no capping on condo fees. Monthly fees are determined by the yearly budget and reserve fund studies. According to the Condo Act of Ontario these studies must be conducted every three years.
If repairs and replacements are up-to-date then your monthly fees should remain at an acceptable level. However, keep in mind, if emergency repairs arise without warning, special assessments, or condo fee increases could occur if the costs aren’t covered by the reserve fund.
THERE IS NO CAPPING ON CONDO FEES. MONTHLY FEES ARE DETERMINED BY THE YEARLY BUDGET AND RESERVE FUND STUDIES. ACCORDING TO THE CONDO ACT OF ONTARIO THESE STUDIES MUST BE CONDUCTED EVERY THREE YEARS.