I getÂ this question all the time. Why do condo fees vary from building to building?
Generally speaking,the answer is simple, yet sometimes detailed. Letâ€™s start with what almost all condo fees (here in Center City Philadelphia) cover: master insurance policy, common building lighting, building maintenance, water & sewer, and a what I call a “Rainy Day” fund for future improvements. This is generally true of low rise , mid rise, and high rise condos.
The base condo fees cover all of the above. Now we need to add in services.
Elevator: Some low rise condo buildings donâ€™t have them. Therefore, they donâ€™t have the fees to operate and maintain them.
Front Door Person: It does cost you to staff this positionâ€¦Employees are not cheap!
Swimming Pools: If your building has one, it is going to cost you higher fees than if you didnâ€™t have one (duh).
Management: Low rise (say, five unit buildings) are usually self managed, and avoid this cost.
Extras: Chauffeur, dog walking, room service, etc. YOU GOTTA PAY TO PLAY.
Every now and again, I will run across someone in a low rise building that says to me, “My condo fees are $25 a month,” and they think this is a good thing. I would suggest that it isnâ€™t. If your association has enough in reserves to not have to collect for daily operation of the building, then you are simply draining from the savings account. And I would venture to guess that your building suffers from a lack of (much needed) on-going maintenance. I often encourage associations to keep the fees going, even if there is a lot of money in the association’s account.
Condo fees that are too high can be a stopper for some buyers, as they are NOT looking for the services afforded by such fees. Conversely, condo fees that are too low can be a signal of a lack of ongoing maintenance (as evidenced by worn hallway carpets and paint, rotted exterior window sills, an old roof, etc).
What do you think? We welcome your input/comments on this post!
BHHS Fox & Roach RealtorsÂ®