[Rebecca - HT]

Need some advice.

Our condo is very well run, but our condo fees are going up. 7% for next year. Most of that cost is for hydro and the reserve fund. Will be 9 years old next year, but it is a well maintained building.

I'm concerned that my fees will be too high to entice someone to buy my condo over the next few years. Getting close to $700 for an 1,050 square foot condo, two bed, bath, den and grass and stone patio in the west. Includes hydro, but we have very few amenities, a basic party room and gym. I know our condo itself will be appealing with the indoor and outdoor space, but the fees not so much.

Contemplating renovations but not sure whether we should put any money into it, just sell and move elsewhere (closer to downtown). Of course that means letting go of our nicely-sized abode for something smaller, but with less fees.

When are condo fees too high?

 

[cdr108]

at $0.66 psf doesn't sound too bad when it includes hydro, but are there other amenties besides party room and gym?
what about security/conceige? a pool? do you have parking, does the fee include it?

currently, pre-con are advertised at $0.55 psf WITHOUT hydro.
but remember, the developers are notorious for understating the costs and if you talk to anyone who bought pre-con, they will also tell you that fees went up alot after the 1st year when the developers are no longer on the hook.

 

[interested]

agree with cdr.
We have a condo in an excellent building (33 years old) with pool, party room, jacuzzi, gym. Includes Rogers as well Well run. 60 cents/sq.ft. Only electricity add on.
Also have a condo in a newer building at 49 cents/sq.ft. Well run but 5 years old.
Both buildings had big increases the past 3-4 years to make up for the HST being added to the reserve funds. Now coming into line.
At 49 cents, this is very cheap. No hydro included. No cable included.
Bottom line is that about 55-60 cents (and probably closer to 60 cents) with hydro is probably realistic these days. If you have a lot of amenties, the 66 cents I don't think is out of line
66 cents may be slightly high but not out of line. Those days of 40-50 cent quotes including hydro are in the past.


As well, not really related but I note the Ritz is close to $1/sq.ft. condo fees.

Another way to look at is this. 6 cents on 1050 sq.ft. is $63 or $756/year. If you like your building and it is well maintained and well run; what are your land transfer costs, cost of moving, real estate commissions, redecorating etc. cost going to be compared to $756. Bottom line, if I liked the building, I would stay and do the reno's you are thinking about. I would inform myself also as to where the cost increases are coming from. Heat/hydro have increased about 10% I believe year on year and that will be the same in any building across the city.

 

[Rebecca - HT]

It includes security. Condo came with parking and locker. But I would say that my building isn't the most appealing for those who want the wow factor, or the extra amenities. We don't have much.

My husband is on the board so I'm well aware of the health of the building, and it's in good shape. The increase is going mostly to hydro, but people are upset about the extra 3-4% going to the reserve fund and other costs. On average the increase in fees is $40-$50 per month for units. People were hoping for 3-5%.

As it's a nine-year-old building I'm wondering if its age (it's not showing a lot of wear and tear, but of course it's not as shiny as newer builds) and the higher fees with deter people. If newer builds are similarly priced, then that will make me less concerned.

 

[interested]

The unit I referred to in the good building is downtown and 1548 sq.ft. so a large unit (the 60 cent/sq.ft). My condo fees the past 2 years went up $100 over 2 years but it was the reserve fund. Now it is caught up and they are projecting and increased fees this year 2%.
Hydro is the same everywhere. If your husband is on the board and the health and building and reserve fund are in good shape, I don't think you are risking anything more than anyone else.

I have been told by agents that the prime escalation of a building is the first 3-4 years. The amenities are done after the first year; the building flippers if there are any are out, and it peaks in growth at 3 or so years. Then you will get the usual growth.

The other issue is to be sure that you compare like units. Units in smaller (less number of units) spread costs over less square footage and hence are higher than large condos (even with more amenities). One thing about amenities. Swimming pools are on people's want lists, add to expenses, and in fact data I am told show that 1-2% of people actually use them. So paying for amenities that you may not use may not be great either. There is something to be said for smaller more intimate buildings but it does come with a cost for the reason above.

I would think Rebecca the bigger issue for you would be whether you like the building, are happy where you are, and wish to stay for at least 5 more years. I say this because if you are considering renos they do not pay for themselves in a short period unless you are doing cosmetic things to make the place more saleable.

Hope this helps.

 

[Rebecca - HT]

I did forget to mention that our building is the smallest with the smallest number of units of all the other buildings around, thus the higher fees per unit.

But people are confused this year with the 7% because the HST was mainly last year and the reserve fund is fairly stable, so they are questioning the increase.

For renos, we have carpet that is looking worn and want to replace with hardwood, and adding stainless steel appliances, so renos that would potentially increase the value. But most importantly, it's what we want to do for ourselves and our enjoyment of our home.

I would like to stay because I do like the size and location of my property and was stressed at the possibility of moving. Thank you for helping me with affirming my decision to stay put.

 

[kkgg7]

Anything under $0.7/sf is normal, particularly when your hydro is included.
Normally new condos start at $0.5/sf and gradually go up. my 13 year condo charges only $0.47/sf,ut not including hydro or heating. But it is kind of an exception.

$700 does sound like a big number though. Although the per sf number is not that bad, I would hesitate if I am buying. I might as well buy a townhouse or something. $700 is like half of the mortgage.