Common expenses always go up
“This is a terribly politically
incorrect position to take but the truth is that people who don’t have
extra money shouldn’t be living in condominiums.”
A close relative from Belleville was telling my
wife about a neighbour who was planning to buy a condo. She is a senior
and she thought that a condo lifestyle
would be enjoyable.
A couple of weeks before she signed the offer, she was told that the
monthly common expenses were about to go up by $16.00 a month. The
backed out of the deal because she figured that she could not afford to
pay an additional $16.00 a month.
What would have happened to her if she had bought the unit before the
announced increase in monthly expenses?
need to rise
A condo corporation needs revenue to pay for all the maintenance and
services that it provides for the residents. If the level of service is
going to be maintained, or even increased, then condo fees must rise by
a minimum of 2% a year just to keep up with inflation.
Hydro and water bills are going up far higher than the rate of
inflation to pay for municipal maintenance and upgrades that have been
years and I have not yet saw a condo building that could do without
As the buildings age, more money is needed to pay for repairs and
the equipment eventually wears out. The owners need to pay up as
they are the only source of income that a condo corporation has.
Any board that brags that they deliver zero condo fee increases, year
after year, is robbing the future to pay for present.
A condo corporation is like a city cab. If you stop paying for oil
changes, tune ups and regular servicing, the taxi will eventually fall
apart. If you cut back on car washes and interior detailing, not only
will it be a piece of junk, it will look like a piece of junk.
The present owner gets all the benefits from cutting back on
maintenance and care but the future buyers will be paying a hefty
premium to keep the beat-up cab on the road.
they do it?
Here is a listing from the MLS. The important question is how does the
board get away with it.
The answer is simple; that board neglects needed maintenance and
repairs, ignores the roach infestations and they hold AGMs every couple
of years or so. The owners put up with it because their common expenses
are low so they think they are getting a piece of the action.
Low-income owner-residents, absentee owners and new buyers are a condo
corporation's curse as most will resist any increases in the monthly
common expenses. If they
become a large percentage of the owners, the board may be forced into
cutting maintenance, starving the reserve funds and hiring low-cost
The building will suffer.
Condo maintenance fees are rising!
Rising hydro and gas costs will mean higher condo fees
by Romana King
October 17th, 2014
Condo and townhome-owners be warned: Your maintenance fees are about to
go up. A lot.
According to reports from Ontario’s Energy Minister, Bob Chiarelli, any
homeowner that pays an electricity bill can expect a 42% increase in
prices by 2018. Add another 18 years and you’ll be paying 68% more for
So, why should Ontario condo-board owners be worried? Because a
significant, prolonged increase in utility costs will need to be
recaptured somehow; more than likely this will mean an increase in your
monthly maintenance fees.
68% of condo owners had no idea their
monthly maintenance fees could increase
This will be scary news for almost two-thirds of condo owners.
According to a 2012 TD Economics survey, 68% of condo owners had no
idea their monthly maintenance fees could increase, while 38% weren’t
confident that they could afford a fee increase.
Strange, considering all the media attention that’s focused on rising
condo fees. Sure, most of the media attention has been on how
developer’s artificially keep maintenance fees low for the first few
years, or the focus has been on board mismanagement that led to
escalating costs, but the overwhelming reason for maintenance fee
increases is an increase in the cost of living.
Don’t believe me? Just ask your nearest condo board member. While wars
are currently being waged over how to keep costs low, condo
associations can already see the writing on the wall: Rates are about
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