If you are living in a condo, then maintenance fee is something you always notice on your monthly due. The maintenance fee will always be a part of your obligation. Many shrug the thought of paying it. Maybe it will help you understand the necessity of the condo management to collect maintenance fees from its tenants if you know how it is being calculated and where your money goes.
How is a Maintenance Fee Calculated?
There is no unified formula in calculating the maintenance fees set by different realtors, as Street Easy writes. In Toronto, for instance, the owner of the condo unit first determines the percentage of the building his unit occupies. Then the owner of the suite is assessed with a monthly fee proportional to the total operational costs of the building. For instance, if a specific unit occupies 2 per cent of the entire building, that suite will shoulder 2 per cent of the entire monthly operational costs. The total operational costs are determined by the condo board and the building’s maintenance department.
There are several factors that define how much each suite holder owns. The first one being the total square footage of the condo unit, which is measured up to the furthermost reaches of the walls. Besides this, the gross square footage of the car park and storage lockers are also being considered. Once all these three areas are factored in, it will be divided by the total square footage of the building, to come with a percentage. The total square footage of the building includes all common spaces like the gym, pool area, garden, party area, parking, etc.
The rate per-square-foot depends on several factors. If a building has above the ceiling costs for high-end amenities like valet parking, landscaped garden, 24-hr concierge, among others, the rate will be higher. If there are so many staffs needed to maintain the building, the maintenance fees will be higher as well.
Understanding how the maintenance fees are being calculated will help you in deciding if you want to own a property in a condominium. If the maintenance fees are being used well to upkeep the cleanliness and services of the entire building, then you should not have any problem paying for it.