Are Your Condo Maintenance Fees Too High? What to Do

Condos are a common choice for many first-time homebuyers because they often cost less than detached homes and provide shared amenities like gyms and pools. Alongside a mortgage, condo owners must also pay monthly maintenance fees that cover the building’s operating costs. These fees should be part of your purchase calculation and your ongoing monthly budget.

Condo maintenance fees typically cover many expenses homeowners would otherwise pay individually. Karolina Armstrong, a real estate broker at Right At Home Realty in Toronto, explains that these fees “keep the building running for all the owners.” They commonly include property insurance for shared areas, routine repairs and upkeep, garbage removal, elevator maintenance, security, and cleaning staff.

Part of the monthly fees is also allocated to a reserve fund—savings set aside for larger, less frequent projects such as replacing windows, roofs, or major mechanical systems. How much a unit owner pays depends on factors like the building’s age, the quality and scope of amenities, whether utilities are bundled, and the number of units sharing the costs.

What’s behind condo fees?

Older buildings generally require more maintenance, which can drive fees higher, and buildings with amenities such as a pool or extensive concierge services usually have higher monthly charges. “It’s a hands-off lifestyle, essentially, but you have to pay for it,” Armstrong says. The convenience and shared services are part of the trade-off for condo living.

As a general guideline, condo fees often fall between $0.75 and $0.85 per square foot, according to Brendon Cowans, vice-president of business development at Property.ca Inc. For example, about $595 per month in maintenance fees for a 700-square-foot unit would be reasonable under that rule. Fees above about $1.00 per square foot may be high, depending on the level of amenities provided.

Conversely, unusually low fees can be a red flag. Armstrong warns that if a 20-year-old building charges only $0.50 per square foot, it may indicate the reserve fund is underfunded. An underfunded reserve increases the risk of special assessments or sudden large fees when major repairs become necessary.

Budget for rising condo fees

Certified financial planner Alim Dhanji of Assante Financial Management recommends that buyers review their monthly cash flow and overall budget before committing to a condo. Because condo fees tend to rise over time, selecting a unit that already strains your budget can lead to financial stress later. “If you are able to absorb those condo fees and still reach your savings goals, then that’s a green flag,” he says.

There is no legal cap on annual condo fee increases in some provinces, including Ontario and British Columbia; condo boards determine the required common funds and set fees accordingly. Each province and territory governs condominiums through its own legislation, which outlines how boards form, set bylaws, and manage shared property.

However, the monthly fee alone does not tell the full financial story. Cowans says the key is whether the reserve fund is healthy and whether the property has been properly maintained. Poor management or deferred maintenance may mean looming, unexpected repair bills and may force the board to levy special assessments—one-time charges to owners to cover major repairs not covered by the reserve.

Beware of special assessments

Special assessments are often a warning sign about a building’s finances, Armstrong notes. They can depress property values in the short term and make selling more difficult until the issue is resolved. “You’re going to have a buyer-beware situation,” she says.

Cowans advises prospective buyers to have their lawyer review the condo’s status certificate, which includes financial and legal details about the building. The status certificate outlines the reserve fund, past special assessments, outstanding legal issues, and other items that speak to the building’s financial and physical health.

Armstrong recommends treating condo fees as a fixed monthly cost that cannot be negotiated away. Before buying, thoroughly review all building documents, understand the reserve fund and any upcoming major projects, and confirm how the fees fit into your long-term financial plan. There is no escaping these fees once you buy, so informed due diligence is essential.

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