Are you thinking about purchasing a Calgary condo? Congratulations! Becoming a condo owner offers numerous benefits as it is a great way to build long-term equity!
If it's your first time owning property in a building, you may have some questions about condo fees, what they cover, and how much you can expect to pay.
So, to make sure you make an informed decision about whether to become a condo unit, stick around as the team from BrokerLink gives you the ins and outs of condo fees below.
What is included in most condo fees?
Being a condo owner in Calgary means that you'll be required to pay monthly condo fees on top of your mortgage payments. These monthly fees are mandatory for all residents in the building and are used to pay for common areas and common expenses throughout. Here is a closer look at the main categories your money will go towards paying for through these monthly condo fees:
Regular maintenance
Routine maintenance that enables the condominium corporation to function on a day-to-day basis is the main cost of your condo fees, which can be broken into various expenses:
Utilities
Utilities for the building's common areas, such as electricity, heating and cooling, and water, are paid for by all condo owners. Remember, this is only for common areas, so you will be responsible for paying the utilities in your individual unit as well.
Cleaning inside the building and the surrounding property
Another part of your condo fees will go to keeping the interior and exterior of the property clean. This includes regular cleaning, garbage collection, and snow removal in the winter. Ultimately, this helps ensure that condo owners live in a clean and safe shared environment.
Building repairs and maintenance costs
These costs include any repair or maintenance work that needs to be done on elevators, amenities throughout the building, and the plumbing, electrical, or heating and cooling systems.
Master policy insurance
Living in condos comes with unique risks that can put your investment at risk. However, part of your monthly condo fees will cover the cost of your condominium building's insurance policy. This insurance coverage, which is also known as a master policy, covers the costs of damages and liability claims in all common areas and shared amenities such as swimming pools, fitness centres, party rooms, or a rooftop patio. Common insured risks include fire damage, severe weather, some water damage, and more.
Management fees for your condominium corporation
If your Calgary condo has a management company, your fees will also go towards administration fees and pay for concierge services as well. This enables the condominium corporation to operate on a daily basis and keep the building in good shape throughout the year.
Building security
Some of your condo fees will also go toward building security. This includes video cameras, security systems, personnel, and other related costs needed to keep residents safe.
Condo reserve fund
A reserve fund, also known as a contingency fund, is a sum of money set aside for major repairs and replacements that go outside of regular spending. All tenants in the building are usually required to contribute money to the reserve fund, which is used to cover some of the following:
Structural replacements and repairs
The reserve fund will primarily pay for any costs associated with significant building repairs and replacements. This will cover the roof, external walls, windows, and other electrical and mechanical systems.
Improvements to the quality to the building
In order to raise the total value of the property, costs associated with building upgrades will also be paid for out of the reserve fund. For instance, updating the units' heating and cooling systems and making other improvements.
Urgent building repairs
Finally, these condo fees include coverage for unforeseen costs brought on by unanticipated disasters like extreme weather or structural damage.
Amenities and common spaces
Condos usually have amenities that are available to all tenants, which is one of the wonderful things about living in one. Sports courts, conference rooms, swimming pools, patios, and other facilities are included in this.
Just bear in mind that your monthly condo rates will probably increase with the number of services it offers. The annual upkeep and operation costs of these community places are covered by these fees.
What are the average condo fees in Calgary?
The average condo unit fee in Calgary will cost you around $0.50 per square foot. For example, if the square footage of your unit is 750 square feet, your monthly condo fees would cost you around $350 on top of your mortgage.
How do you calculate condo fees?
So, how exactly are condo fees calculated? Common elements that go into determining how much owners pay for their condo fees include:
Annual budget
The condo association in your building will create an annual budget that estimates the total costs for maintaining and operating the complex for the entire year. This budget includes:
- Routine maintenance such as landscaping, cleaning, and repair work.
- Utilities for all of the common areas, including electricity, water, heating, and air conditioning.
- Management fees if your condo has a management business operating in the building.
- Insurance for common areas throughout the complex.
- The reserve fund is also important. The condo corporation needs to ensure there are enough funds for any unexpected repairs that may arise.
Square footage of your condo
Again, you can expect higher condo fees if you live in a larger unit compared to someone who lives in a smaller square-foot unit.
Beyond these factors, you can expect higher fees in buildings with more amenities, given that the average annual cost will be higher than in a building with basic facilities. It's also important to mention that if you live in older buildings, the overall cost of your fees may be higher than other owners who live in a new complex, given that older structures tend to have more problems and need more frequent repair work.
When purchasing a condo, make sure to ask about the financial health of the reserve fund and ask for a breakdown from your condo board about the individual condominium contributions for the unit you're looking to buy. This can help you determine whether or not you'll be able to afford to live in the space.
Do condo fees include utilities in Calgary?
Utility expenses are paid through your condo fees. However, your condo fees cover only the utilities for shared areas in your building, such as the lobby, hallways, elevator, and amenity rooms, not your individual units.
Some condos will pay for water throughout the entire building, but it can vary. Therefore, condominium owners will be responsible for paying the utilities in their unit on top of their monthly condo fees.
Is it mandatory that unit owners pay a condo fee?
Yes, all owners must pay a monthly condo fee in order to reside in the building. When it comes to multi family properties like condos, expenses can be significant. Without shared fees, it's likely that you would be living in a space that was unclean, broken, and unsafe.
While some may think that it is unfair that they have to pay for amenities that they never use, this is one of the sacrifices you have to make in order to live in a shared space.
What condo fees are not included in Calgary?
Potential buyers must understand that their monthly fees will not pay for their annual property taxes. Additionally, the insurance held by condo corporations does not extend to their private living space.
So, you'll also need to purchase your own separate condo insurance to ensure your personal belongings are protected from damage and theft, and that you are protected against liabilities.
Protect your condo with high-quality insurance. Call BrokerLink today!
Have you recently purchased a condo unit in Calgary? Protect your investment with tailored insurance from BrokerLink.
For high quality insurance solutions tailored to your unique needs and condo building, reach out to the experienced insurance team from BrokerLink.
With years of experience and locations across Canada, BrokerLink is here to help find insurance policies you can feel confident in at an affordable cost. If we're in your community, visit us in the office to work with one of our brokers.
If you can't make it in person, our team is also available over the phone during normal business hours. You can also get free, competitive insurance quotes from the comfort of your own home using our online quote tool!
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