Q: I have some real concerns about our yearly condo fee increases. When I purchased this condo three years ago, our fees were $275 a month, now they are nearly $450. Is there a cap on fees? Why didn't my real estate agent warn me?
Answer: It is not the real estate agent's job to warn you about rising condo fees. Buying a condo is unlike buying any other type of real estate. Anyone considering purchasing one must do their homework.
Some buyers see an updated kitchen, beautifully painted walls and new appliances and get hooked. They base their decision solely on cosmetic features.
Unfortunately, most prospective condo buyers never ask the most important questions, such as who is managing the condo, has there been a special assessment in the past year, when was the last reserve fund study conducted, how often do the monthly fees increase, when was the last annual meeting. who are the directors, is there a list indicating when the last major repairs were completed, etc.
Some owners wonder why condo fees are high (or in very rare cases low), but never investigate. One size does not fit all and each corporation has different expenses. Such amenities as tennis courts, swimming pools and gyms are expensive to operate, while other buildings have a bare minimum of amenities.
There is no capping of condo fees. Monthly fees are determined by the yearly budget and reserve fund studies particular to your building. If repairs and replacements are up to date, fees should remain at an acceptable level. Excellent management skills are a must in order to maintain an attractive property with reasonable maintenance fees.