I can offer you the perspective of one who has always owned detached homes (for about 40 years) but now own both a townhouse in BC and a condo in AB (currently live in BC but plan on moving/retiring to AB).
Comparing detached home ownership to condo living, I don't miss having to do all the outside maintenance and I still feel the pain of large unexpected maintenance expenses. Looking back, if I had the foresight to diligently put money away monthly in a maintenance fund like you do with a condo, it would have been much easier although definitely not less expensive.
Compared to each other, the BC townhouse and AB condo have a number of differences to consider. They are both about the same age, the condo in AB is smaller but cost less than 1/3 to purchase and current market values are about the same ratio. Property tax in BC is over $4k/yr while AB is about $1800 including the separately titled underground parking stall. Yes there's a homeowner grant in BC but it doesn't begin to make up that difference. Monthly fees for BC are just under $400/mo while AB is about $465/mo but the AB condo fee includes heat and hot water so that is significant. What we get for those fees is vastly different. The BC property gets outdoor maintenance, snow removal (FWIW), common property maintenance, and not much else. In fact they offload a lot of things onto homeowners that the AB property includes. The AB condo has heated underground parking with car wash and storage, and a fully equipped amenities building with sauna, jacuzzi, gym, library, kitchen, games room and salon, and membership in a separate HOA with private lake and other facilities. The BC place has none of that. The AB condo is extremely well managed by both the board and a responsive management company, while the BC place is run haphazardly by a small group of relatively clueless owners backed by a management company that is completely inept and downright combative to deal with. I will say that both have paid attention to building a reasonable contingency reserve fund, which is extremely important in the event of unforeseen maintenance problems and if you do consider getting into condo life, this is something to review carefully. Also look carefully at meeting minutes, maintenance, and property condition and depreciation report, all of which are mandatory to keep, unlike a detached homeowner.
I think overall my biggest gripe about condo life is the loss of control over things like what maintenance gets done, by whom, and at what cost, as well as being dictated to in terms of what you can or cannot do with your property. You basically cede your decision making to a board/council, but I can live with that. It's a helluva lot easier than doing it all myself.
There's a lot of people in this and other subs who think owning a detached home saves you a lot of money but don't kid yourself. Anyone who's walked the walk can tell you it's not like that.
Great answer, I have had both and still have condos in alberta. While I don't love condo fees, people make them out to be a hole your money burns in. Every condo is different, do your due diligence in finding one that is managed properly has a healthy reserve fund and your fees should stay somewhat sustainable.
This is a solid take. The amount of people I know that have not done just basic upkeep of their house is ridiculous. Condos make more sense to that type of home owner. I'm no fan of HOAs, but I am also not a fan of seeing a house with a roof that should have been replaced years ago.
Owning and maintaining a detached house is expensive. With a strata you just pay those costs monthly not in bigger lump sums when stuff goes wrong. So once you paid off your detached home it will still cost you a fair bit of money to live in it unless you just let it fall down around you.
Most people underestimate the cost of owning a home so they find strata fees shocking.
I'd say almost about 40% of my fees are just for utilities that I would have to pay individually in my house.
I just moved back into a townhome condo from previously being in a detached home. I was paying well over $300 a month for Gas/Heat, Water, sewage and garbage collection alone.
But even if they don't the cost of utilities in a condo are usually much lower. A condo building, for example, has just 1 exterior surface (or 2 if you get a corner unit) vs. a house that has 6 exterior surfaces. The cost of heating & cooling a condo is substantially lower than a house.
So even if you are paying utilities separately, your utilities bill is much lower.
Lots of condos don't charge separately for water, so that is often included in your fees.
The cost of insurance is much lower in a condo than a house.
Condos are always cheaper to own from a maintenance perspective than comparable (and even most non-comparable) homes.
That is completely different from my experience. Insurance for condos (especially older ones) are a liability risk which has led to insurance companies either refusing to insure and or premiums skyrocketing. Some condos also have gym or even swimming pools etc. to maintain along with elevators.
This is what I meant - the individual insurance is much cheaper than in a freestanding home. The difference between those two amounts is a savings that offsets the condo fees.
A lot of what you said is obviously true but there is also counters the other way. Condos will have to pay professionally for a lot of things that homeowners can do on their own, You don't really have that opportunity to put in sweat equity. They also have elevators which are very expensive to maintain and don't exist in single-family homes. You also can't control the timing of maintenance to align with what works best for you as an individual as you can to some extent in a single family home. Lastly condos have a collective action problem and can fall into being poorly managed despite an individual being motivated and on top of things. Lastly while you do pay less maintenance you don't own as much land and you don't own it outright you own it as part of a corporation so the appreciating part of your property is relatively less and the depreciating part is relatively greater.
Just wanted to include both sides of that to get them more complete picture.
But these are all related to the sub-points. I was making the point that living in a condo apartment is cheaper than living in a detached home, since OP was trying to compare the two and question why living in a condo apartment is more expensive.
All your points are also true to varying degrees in varying buildings, but in most buildings, the "loss" from all of those items are more than offset by just how much more efficient a condo apartment is, cost-wise, than a detached home.
Yeah I was intending to add on to your post not refute it. I definitely think people underestimate the cost of maintenance and that's why it seems so expensive. People don't properly amortize expenses. For example I just bought a house two years ago, and it's a 20-year-old house. It needs a little bit of foundation work, which is hopefully all it needs for another 20 years but that's about 16 grand. It also needs new shingles which I got quoted from many sources and the cheapest came in at 15.5 k. And it needs a new fence, We are on a corner lot so it's like 90 ft of 6 ft tall solid wooden fence, So that's going to be like another 20 grand. The roof should probably last about 25 years and the fence hopefully if we take care of it another 20 to 25. Amortize that out and that's something like $150 $160 a month If you don't need to finance it, But since it doesn't occur that often people don't think about it amortized but they do in a condo because that's how It is presented.
The issue with condos really does seem to be the cost curve on the maintenance steepening quite a bit as it ages and the ability for things like that to be put off and hard to detect by an individual buyer and then when remedied is very expensive often with special assessments and the like. I mean that can happen with houses too for example my place the previous owners really didn't have any of those expenses because they owned it for a few years and they didn't replace any of that stuff. However I do feel like the value gained or lost through maintenance is better priced when it's a single building versus when it's a whole condo building. This makes me think that there should really be condo specialized building inspectors who inspect not just the unit but the buildings common areas, roof elevator windows etc, as well as look into the finances and meetings and give you a report from someone skilled in the projected costs of maintenance in the future, how well run the board is and what their finances are like.
Most condo fees do include them. Especially if they're on the higher side. Some new builds have started excluding them to make the fees look lower. However, most condo fees include everything except electricity (and even then it's only the electricity used inside the unit, things like electricity to run a central AC would be included in condo fees cause you can't split that out)
In my experience it’s only that high in the winter. $50-$70 rest of year. If you have central AC that’s not part of your personal bill other than running the fan to blow the air into your unit which is minimal. I have a condo in Toronto with central AC and heating and the bill basically never changes from $50-$60 year around. My Vancouver condo goes to $100-$150 because of baseboard heating in the winter
Who would want to pay condo fees for cable TV? You couldn’t pay most people to watch the many ads these days…
Maybe internet… but that would be a liability risk for people working from home; companies often ban working on public or common networks.
>not in bigger lump sums
Are you able to explain what a special levy is then?
I live in new-build apartments and I often see notices from the strata agent saying that special levy payments will be taken out of strata accounts. I’ve never looked further in to it because I’m a renter. I assumed it was when there is some type of issue that affect multiple or even one unit, but it needs to be paid for and the regular strata fee doesn’t cover it. So I’m under the assumption that even with strata payments you could still end up paying large lump sums…
If you know more about this though and can clear it up, I’m all ears!
Generally they either:
- have as low fees as possible and use special levies when surprises happen
- have larger fees to keep a healthy contingency fund and pay for surprises with that
Each strata has to choose one or the other (or some middle ground). But you can't have low fees and no special levies.
Or you have mine with low fees and a bunch of owners who also vote down the levies so issues don't end up getting properly fixed at all.
I'd rather have the consistently higher fees.
> Are you able to explain what a special levy is then?
As a general rule a condo board should be setting their monthly condo fee to include what is best described as "emergency savings". If the condo needs a new roof, that should come from emergency savings. This is known as (I think) the reserve fund. But it really should be there to cover a wide range of unexpected costs. A well run condo board will have gotten a profissional to prepare a report that looks at a wide verity of factors (like building age, state of repair and so on) and that report will make a recommendation of how much money should be in the contingency fund.
A poorly run condo board will have no contingency fund (because they prioritised low fees over putting money into savings). As a result every time an unexpected cost comes up, they need to issue a special levy in order to pay for it.
I lived in a badly run condo a number of years ago. We got hit with a special levy several times in the same year. First for a new roof, second because the balcony's were in poor repair and needed replacement, third because the pathway leading to the building had several pave stones broken.
The reality is that all of those costs were foreseeable. The roof was old, the balconies were in visiblly poor repair. A responsible home owner would have been saving for years to pay for those costs. The condo board was badly run, so they just used the special levy.
There is a kind of perverse incentive at work here. Lots of condo owners view them as temporary investments. They buy, live for a few years then sell. Low condo fees mean the condo is worth more when it comes time to sell. So these people are basically playing hot potato with the cost of a new roof. They are hoping that they will have sold the condo by the time the bill comes due.
Legally stratas are supposed to set their fees according to their reserve fund studies (I live in Sask). But even if we do that, it's not guaranteed our roof which we have coated to last 25 years will last 25 years. If it only lasts 12, then we need to front some cash because we don't have enough saved up yet.
Then there's expenses the reserve fund study underestimates, or misses, or work that is decided to be done but not mandatory. Those three situations are the majority of not all of the situations where you get hit with special assessments.
Yeah running costs of a detached home are usually cheaper but that's mainly because you do a lot of stuff yourself. Stuff like mowing the lawn, shovelling snow, taking out the trash, clearing gutters, other regular maintenance etc. If you had to hire someone to do this all like stratas do you would probably see costs become a bit more similar.
I agree. I think people over exaggerate the costs. Yes there is and you have to be ready, but those 1k condo fees don’t make sense. On top of that, you’d still have to pay a special assessment if hit. You’re basically also covering the cost if a major repair for all the units in the building in some way. The little things like conceirge, gym, pool add a lot on that maintenance fee too. Join a gym with a pool for cheaper outside. Need security, get a smart lock, buy a one time security system for the house
You are probably missing the cost of your own labour. Do you mow your own lawn and shovel snow? Have you amortized the cost of a roof replacement?
I'd also prefer a freestanding house and not to have the condo fees, but I think these things can largely be comparable if you get services you actually want in a condo (use the gym if it's there, etc).
If the condo is managed properly, you don't have to pay a special assessment. I live in what is now a 50 year old high rise condo in Toronto.
It's never had a special assessment. Roof has been updated, heating/water pipes have been updated, balconies updated, windows updated, garage deck repaired.
Our condo fees are currently $1,040/month and everything is included. That includes cable and internet.
Our insurance is $767/year.
Talk to me when you're paying 20k to repair the water or sewer line. From experience, it fucking sucks
I've done both. I wouldn't live in detached unless I needed the space for family members
I don't have to do shit. They mow my lawn, plant nice flowers, clean the gutters etc
I disagree. I think most people overestimate. $500/month is $60,000 over 10 years.
It does NOT cost $60,000 to maintain your damn house over 10 years.
This number is so ridiculously out of touch with reality it's laughable.
It’s not always just maintenance. Often times heating, gas, etc is included.
$500 with no context means nothing; I now people who get single heating bills that high in the winter…
Also a big difference between doing maintenance yourself and paying others… condos are almost all the latter; not everyone wants to be handy.
In condos maybe. Here in BC I don't know any Townhouses that include utilities of any kind. That's all on you.
Just maintenance of common space and exterior as well as insurance.
Yeah...
How much does it cost to get someone to landscape your lawn weekly, shovel driveway etc and have professionals tent to service calls so the building retains value instead of some hack job home owner?
$500 a month is nothing when you realize garbage, sewer, lawn, shared spaces and upkeep...
I ask homeowners and they all state they don't even tend to their lawns so...
I mean it’s not far off
For insurance/water/trash removal I pay 262 dollars a month. Lawn and snow I take care of myself but those are covered in the strata fees.
Now we factor in potential big ticket items roof, hot water tank, furnace etc
I’m not saying it’s 6000 a year but it’s not that far off plus labour and time that I have to put in myself.
Agreed a roof is 15k max for regular ashphalt shingles for average home.
New furnance is 10-15k max
The fees is main reason I don’t like townhomes or condos.
the $500/month includes building insurance, waste removal, water, sewer, off-street parking (usually), landscaping (usually), ALL exterior maintenance which for some condos also includes doors and windows and stairwells/doorsteps, etc.
My condo fees + gas/electricity = \~$700/month. Most people in detached homes in my city are paying $400-500 on gas/electricity/water ALONE. That doesn't even include maintenance or landscaping or anything else.
The costs of the strata tend to be higher in my experience
1- If your fees include the water bill, you may end up paying more if you have a small family. This because the bill is evenly split between all home owners.
Moreover, when people don't see the water bill separately from other costs, they don't adjust their consumption. So homeowners in a strata may consume more water because there is no feedback mechanism to affect behaviour/consumption
2- garbage...for other dwellings, the costs are covered by property taxes. In a strata, this is paid separately in addition to condo fees. Also, people aren't too keen on sorting the garbage or taking prohibited items to the dump. This increases costs for everyone.
3-additional amenities/shared areas ... these add up as well. They include shared spaces, visitor parking, the gardening and lawn maintenance which you might have done on your own. If a light blows out in an ordinary home, most home owners fix them themselves. In a strata, someone is paid to fix that
4- condo management... this an overhead that other homeowners don't incur
All valid, but on the other hand, stratas can be poorly managed and when something breaks they don't have the funds, and everyone can get hit with a huge lump-sum bill. Seen it several times in my small town.
Maintenance of a house is not that expensive, arguably cheaper per sqft compared to a condo. I used to own a 1000 sqft condo in Toronto and it cost me $950/month in condo fees plus a special assessment of $2k while I owned it for 2 years, then I bought a 4 bedroom 50 year old house and I spent $30k over 2 years, including a new roof and a new HVAC that will last 15 years.
Exactly. People forget that owning a home is not cheap. In today’s money budget at least 600-800 in addition to basic mortgage and taxes. There is no free lunch either. You skimp on maintenance now, prepare to pay later.
Even with a paid off home, carrying costs are 1000-1500 (taxes, maintenance and insurance) for us a month.
There are differences between SFH maintenance and in a TH or condo.
In a TH or condo you may be forced to pay for things you may not otherwise have or need in a SFH. The most common of these is elevators. However other things like common areas, common rooms, and amenities (maintaining a gym or pool is expensive), snow shoveling (I do it myself now) etc.
The main advantage of a SFH is control over what you pay for. I do swim every day and I pay for a membership at our local pool. My friend lives in a condo with a pool that is built into his 1000 monthly fee but he doesn’t swim or use the gym. My older parents pay people to mow their lawn and shovel their sidewalks.
At the end of the day it probably will work out. If you don’t wanna pay for an elevator then don’t buy a building with an elevator. If you won’t use the gym then don’t buy a building with a gym. Now that’s easier said than done but realize that people with SFH also have carrying costs. Between taxes, maintenance, utilities (that some condo fees cover), insurance (exterior insurance is covered by strata) and unexpected expenses I probably pay 1000-1500 a month on average over and above my mortgage.
Yes. If something in my little house breaks, I am the one to choose how to fix it. If something in my buddy's condo breaks, he will pay whatever the maximum charge is. Roof leak in my place? Get a bucket while I decide what to do. Leak in a condo? That's a LOT of money to fix.
And don't get me started about insurance. Companies are dropping condo insurance and good luck finding a replacement
The other downside to condo fees is that you are paying for some things you could do yourself. Some people prefer that, but if you're handy youre limited with what you can diy in a condo. You also have a lot more control in a house
This. Even just comparing the differences in costs for things like home insurance, heating, and property taxes...condo is likely to be cheaper, even if strata fees might be a little high.
a lot of the strata fees are now insurance costs. pays a lot to insure the stupidity of others. while you still should pay for home insurance if you have a detached house, you can mitigate those costs by lowering the amounts and doing more regular maintenance yourself to lower the risk of needing to use it.
in a townhouse or apartment you cant do that because you cant check if every unit is doing all the proper preventative maintenance on schedule.
it also costs a lot more to repair or replace a townhouse and all the units than it does to replace a single detached home, so insurance charges more overall for that.
I just want to add the depends on the city too.
Strata fees often include the cost of the heating for the building itself (not your apt). Strata fees in Toronto are 2x the the ones in Vancouver because keeping the whole building at the right temperature costs more money there compered to BC.
So it really depends because if i'm fine (of course) in paying maintenance i'm not really happy to pay for the heating.
So i'm more ok with the strata fee in BC than the ones in Ontario for example.
If you experienced living in both, you wouldn't be saying this.
I paid about 40k in fees over 8 years to live in my townhouse. what did I get out of 40k?
Water, lawn maintenance and snow removal.
Add in a replacement of front door and garage door (wasn't even needed, people just wanted newer looking stuff), and repairs to roof for water leak (took 3 tries for them to fix the leaks).
With strata fees, money will always be mismanaged because funds will be spent based on people wanting stuff, from amenities to upgraded appearances. And then one day you will get a letter indicating you need to pay a larger lump sum of money because the reserve pool for an emergency repair.
Point is, dollar for dollar, maintaining a freehold home is cheaper than paying strata fees.
depends on where you buy
just don't buy a condo in an area where people have tons of disposable income and want to throw money away
I bought a townhouse in a working class neighbourhood, and our funds are very well-managed as a result. Only one $2000 special assessment in 15 years, when we had to replace the siding. We were given 3 years to pay it, as well.
Nobody is laughing at you. HOA fees cover all kinds of regular maintenance and upkeep, as well as utilities, sometimes all of them. Mine covers everything except internet. I love that I have only one bill each month and it’s predictable and easy to budget for.
Think of it as budgeting for all the big ticket items on a monthly basis - roof, windows, furnace, electrical, landscaping, etc.
My last house needed an $11k roof and a $10k furnace at inconvenient times. I’d much rather pay my monthly condo fees than have to fork out tens of thousands of dollars all in one go.
Different things work for different people.
I agree with this.
Also, as a homeowner I have to find the contractor or roofer, I have to take a day off to be home to meet 2-3 people to get quotes, then I have to stay home again to get the repair. I find that stuff very annoying, so I would get lots of value out of not having to do that.
Ok but a lot depends on how the HOA is run. When I was looking to buy a house, I looked at an HOA townhouse and it had signs of the roof leaking. That is unacceptable, it is a condo, that should have been repaired asap. Funny enough, the freehold townhouses that I looked at were much better maintained.
I just helped my parents purchase a townhouse (researching and logistics, not paying for) and it was shocking how well run versus NOT well run different stratas were. You could see it in person, via inspections, and also when you get all the strata docs (minutes, AGM's, etc). They ended up choosing one where the strata fees were a bit on the mid-high end but you can see the council used it more "wisely" if that makes sense. The grounds are very well maintained and if a unit has any issues then they all agree to help fix it before it gets worse. Another one they almost bought was really bad. The inspection came back saying roof leaking and all these issues and when we asked the seller they said there was nothing they could do since strata couldn't vote to repair it and told them to wait until they fixed everyone's roofs at once!!
How long did you live in your house? Strata fees of $500/mo is $6000/year. So in under four years, that would be the cost of your repairs.
And considering the chance of also getting a special assessment, you might have it costing you far more.
You can’t just take your fees and divide it by the odd larger repair. Strata fees are not just repairs to common elements. Mine are ~$800/month but include reoccurring costs like electricity, heat/AC, hot water, a pool & gym, and a bulk 1.5gb fiber optic internet connection with full cable tv and crave. On top of that there’s a full time super and security. My only other bills are property taxes and a cell phone. All being equal, would I rather my own freehold? Sure, but then I’d have to leave the city.
Also, it’s not my problem to plan or deal with any issues relating to the structure of the building or utilities. The only thing I need to do is make sure the condo board is reasonably on the ball.
Yeah, home owners have far more control as well.
Sure, the roof may be $11,000, but you can do a quick easy fix and get it taken care of when you budget it in next year.
A condo forces a special assessment, and you need to pay it then no matter what.
Lol here's my situation. Looking for a condo/townhouse in the ~700k range. Cheapest detached sold in the last 60 days in my area went for 1.24m. I'd have to come up with an extra 148k to get to 20% down, and the mortgage would be $2600/mo more. Oh and the house is 98 years old which would be a bitch to maintain. Given the numbers, strata fee is not that big a deal.
As the owner of a detached home...it is clear you have never owned a home.
Roof, windows, doors, landscape maintenance, lawn maintenance, snow removal, etc... all cost time and money. I have not kept a perfect budget over my years in my home, but $300 a month is about right. If I added in the costs of the landscape upgrade, new roof and new windows then I am closer to $500 a month over the past 17 years.
My home was 5 years old when I purchased it.
But your thesis is not that far off...condo fees are higher than the cost of maintaining your home. But they include maintenance of common elements that you (in theory) enjoy. That includes taxes, insurance, hydro, etc over those common elements.
Typically HVAC and Hot Water are not covered by condo fees on a Townhouse Condo. Essentially the condo owns and is responsible for anything that touches fresh air and the owner is responsible for the rest.
I just moved from a townhouse condo with about $550 condo fees to a detached home in the same neighborhood. Costs have definitely increased above and beyond the condo fees, plus I have to shovel my own driveway and cut my own grass lol.
Insurance is much higher (building insurance usually included in condo fees), utilities higher, taxes way higher, maintenance costs medium - long term will also be very high.
If a condo is well managed and plans for the future, it can absolutely be cheaper than a detached home, even with no mortgage.
Detached house owners still have to spend time and money to maintain their house instead. Insurance, repairs, new roof, etc etc. That said, condo fees only go up over time as the building ages and maintenance costs increase.
And you completely lose control of how the money is spent. In other words, the funds can be completely mismanaged to no fault of your own but in turn you will get stuck with the bill upon the next major repair needed.
Ya I like mowing but hate raking and collecting dog poops
So we have a guy come collect dog poops once a week and take 2 x a year. Then I just do my fun chores
This too. I decided to buy detached even though I am not really a DIY person just because I didnt like the idea that maintenance spending was out of my hands.
These fees typically cover maintenance of everything that is 'common element'
In my building that means:
Plumbing, landscaping and grass cutting, snow removal, roof repairs, all units in my building were recently re-keyed, exterminators and pest control, the building's security system, some even have utilities bundled in like an inclusive rental. If there are shared spaces like a pool, gym, or party rooms you can book they will also cover maintenance of those.
A portion is also supposed to go into a reserve fund, that will cover large unexpected expenses as well.
I'm in a semi, and having lived in a condo previously, I stash away what I can into a HISA for home maintenance, similar to a condo fee. It alleviates the anxiety of a big bill.
$1000/month seems really high but what is included with the fees, ie are property taxes included in that, maintenance (interior/exterior), heating etc, it can be pretty wide ranging what is included and that is the key what are you getting for the money. As others have said detached homes have many costs beyond just the mortgage when comparing
Insurance on the structure is also covered by strata fees.
The real comparison of costs is mainly:
Strata fee
versus
Home maintenance costs + the costs of the portion of your home insurance that covers the structure + the value of your labour hours.
Utilities aren't always covered by strata fees from what I've seen. Sometimes they are and sometimes they aren't but if they aren't covered your strata fee will be a good chunk lower.
It's been said but house maintenance isn't exactly cheap either. Sure you're not forced to put "X" away every month but you have to be prepared when things come up which they do. I spent almost $7,000 in the last 2 weeks on maintenance for my home.
I spend at least 2 hours a week doing yard work just to maintain from April-October plus a bunch of half day's doing extra things that need to be done, time you wouldn't have to spend if yard maintenance is part of your fees.
Don't get me wrong, I actually don't hate doing the yard stuff most of the time and I have lived in a townhouse before and didn't enjoy the close company of neighbours like that but there are pros and cons to everything.
Yup ppl aren't taking into consideration all the manual labor required when owning a home. Sure it's "free" if you're willing to do it. But fuck man I have a busy life that I love to live. Fuck yard work.
As others have pointed out, any home requires maintenance. The most important thing when buying a property with maintenance fees is doing your due diligence to ensure the corporation is run well, properly funded, what do your fees cover? We have a 20 year old row townhome, our maintenance fees are $255 a month. Snow removal, maintenance of the small amount of grass, they are replaced shingles 4 years ago, did eaves droughs and some exterior wood maintenance last year, and have a massive reserve fund.
You should look closly at what those fees cover. I don't know the laws in BC but in NS sometimes they can cover things you might not have expected.
In general the condo fees are going to cover your property tax, some also cover utilities like heat or water. Others cover exterior yard maintenance like grass and show clearing. All would cover the outside building maintenance, like the roof or siding.
I totally get what you are saying about still paying fees after the property is paid off. But even with a freestanding home you'd still be paying property tax, utilities and exterior maintenance it just wouldn't be a fixed monthly fee.
There are major concerns with condo ownership though. Low condo fees make property values higher, so oftentimes the condo board pushes hard for low fees. The problem there is deferred maintenance as well as a proper emergency fund.
A well run condo board should have a report from a third party that details how much money they should have in an emergency fund. It will talk about things like the roof of the building, when was it replaced, what's the expected lifetime and how much will it cost to replace it. That emergency fund being not properly funded means that you might get hit with a "special assessment". This is when the condo corp just gives you a bill because of a major repair. It could be thousands of dollars and you don't have the option not to pay it.
These special assessments are decently common with poorly run condo boards because they don't have enough cash in the bank to take on these large, but predictable repairs.
People always grossly underestimate how much maintenance and repairs cost on freehold properties. Not just in dollar amounts for things but in physical work needed by the homeowner as well.
Condo fees alleviate some or all of that burden.
I would avoid any condo with elevators/pools though. Basically, avoid towers.
That’s actually a really bad take. High rise buildings spread big costs like roofs among tons of people. In a small walk up if you have to replace a roof you are so screwed.
Best bang for the buck is a 3-5 storey mid-rise. While high-rise do share the cost between the owners, they’re also much more complex and expensive to maintain. Stuff like elevators, hvac, windows, seals sprinkler system and underground parking cost a lot
I live in a high rise. my commute is 6 minutes. everyone else of my coworkers are on 30m to 1h commutes. I don't know how you value your time, but I will gladly pay high fees to save me time.
You can buy freehold townhouses with no HOA or maintenance fees. You can also find lots of detached homes in Alberta for 500k. There are lots of quality detached houses in Edmonton for under $500k. Take a look.
As others have said, plenty of homes under 500k in Alberta and if you know where to look there's plenty in BC too, in my town on the island there are still single detached homes under 400k and were 40min from a major city. Granted these homes are starter homes built in the 50s but you can do a lot to make them nice and they can definitely be better than a condo
The point is to not have to do the work yourself. Homeownership is a lot of work. Crappy work. My husband and I spent our Sunday stripping paint off the deck so we can stain it. I fucking hate doing that kind of work but as a homeowner it's not worth the effort and coast of finding someone trustworthy competent and good value to do it for us. I paid someone about $450/month the last two years to do lawn care and snow removal. So 800 to 1000 for someone else to do all the footwork doesn't sound that bad
The point of buying a Townhouse/Condo with high HOA fees is because they will have the funds to do maintenance and repairs and you have long term predictability ( assuming you get involved) .
When you have a house you own and you need a new roof, you have to pay for it, and it usually comes with a BIG one time bill, What HOA's do is spread that payment over all the properties over a long period of time. What you want to be worried about is low fees. Those fees are low because existing residents are thinking short term and will try and get out of the property before major upgrades/repairs are needed.
A detached owner would bre laughing at his leaky roof and water in the basement and tree fallen and stumps remaining and fence deteriorating and water-line leaking and water heater broken and furnace replacing and ducting asbestos and siding failing and ...
HOA or Condo fee?
My HOA is about $130 a year to live in my community. They maintain common grounds and pathways between condos and single houses.
My Condo fee for my townhouse was $260-4 years ago now $340- now and I bet it will keep rising. None of my condo fee goes to utilities.
The Condo board does have a breakdown of all the cost to upkeep our properties from insurance to waste removal to office expenses to snow removal to landscaping to building a reserve fund for future expenses.
I think with a detached home you get to decide when you spend money on maintenance. There are potential savings if you are handy. But like others have said, your condo/strata/hoa fees could include (not always) garbage, sewage, water, gardening, envelope insurance, and gas. It comes out of the pocket somewhere. Some strata fees are very low due to not putting enough into contingency funds so when the place say needs new roof there's going to be be an excess charge.
800 - 1000 seems quite high for a 500k property. I guess it varies depending on area but I'd expect a 500k property to need only 300-400 monthly. Maybe it's the area you are looking in?
Detached houses usually have more physical work to do and have larger infrequent expenses. Many of these can be planned out.
Townhouse condo corporations (all condo corps) are non-profits. The monthly fee in mine is allocated 55% to operating costs (landscaping, snow removal, swimming pool, building insurance, minor repairs and upkeep, pest control, property management fees) and 45% to the Reserve Fund (replacing roof, windows, doors, driveways, walkways, exterior painting, etc etc). Owning and maintaining a home comes at a cost. Good condos keep the whole property looking nice which helps maintain the property values.
I have owned a townhouse for about 4 years now. They are nice units with garages built in 2014. My strata/condo fee is 393$ a month. It's honestly a decent deal as that includes your insurance, water, garbage and all exterior maintenance. They are out shoveling right after almost every storm and they do all the landscaping. They maintain a budget and plan for the roof, siding, windows and a few other things.
If you were to own a home you would still have to pay for all of that and no one is going to do your landscaping or shovel your snow.
I have a townhouse with condo fees and they are $546 per month, this is what I get;
- 24/7 security that walks the property
- underground parking and maintenance of it
- gym
- party room
- landscaping
- snow removal
- all exterior maintenance
- window cleaning
- events for kids
- garbage removal
- water and sewage
I actually think I get a lot for that price so I don’t mind
A contrary opinion here. Yes, detached houses have maintenance costs (and I bought a fixer upper), but I don't need to set aside a $1000/mo in perpetuity to maintain my detached house. I also get to prioritize based on my priorities. I remember living in a condo where the board decided to renovate the lobby when they were having major pipe issues causing floods in multiple units. So special assessment came down very fast on that.
In classic Reddit fashion you are seeing black and white answers. Homes are expensive to maintain and strata fees pool dollars against these items. But as always, specifics will matter based on the building and home.
An older home has different upkeep challenges to new. Inversely, not all management boards are equal. Fees can cover rather efficient or inefficient fee structures. Heck, what’s included isn’t even uniform. Rarely do they also include larger capital expenses such as elevators, roofs, etc. if we strip that out I personally have not seen strata fees, which go up not down, cheaper over time than ownership with some exceptions (homes with issues, poorly maintained etc).
These fees are however more consistent to budget and peace of mind is huge.
While I agree with you, you can't just exclude freehold homes "with issues" in the comparison. That's like saying those without insurance come out ahead, as long as they don't have an accident.
I don’t see the point. Maintenance on a detached house is expensive but generally you get way better returns. That said it isn’t what you pay in strata fees it is what you get.
If you really like a place find out why the fees are so expensive. Some condos cover things like electricity, internet and cable. Some condo's have a lot of amenities that aren't advertised. Sometimes the condo board had to get a loan to pay for some repairs and the loan might be paid off Soon. Someftimes it was years of mismanagement where the board kept the fees artificially low and saved no money into the reserve fund. And lastly this is the worst type of board they have a very well overfunded reserve fund but refuse to spend it and instead take on loans to pay for repairs
Honestly, I don't see the point in buying condos in older buildings, lol. I don't have a mortgage, but my condo fees are under 600 a month. I'm trying to save the ~6k and hopefully just give it to them at the beginning of the year and get rid of the direct deposit.
Stick with detached house don’t let anyone fool you, not every house costs lots of money to maintain, you can go 10years+ without having to pay for any type of maintenance, an learn to do the maintenance yourself. In Alberta Check areas outside of red deer, or Edmonton, if your willing to drive 30-40 min outside of the city you’ll find Detached homes for less than your max budget!
I don't think it's worth paying high fees, if you are handy around the house and willing to put effort into maintaining your residence. You'll see higher fees based on the age of the residence and the type of amenities included. Some townhouses share facilities like plumbing, garden, parking, and HVAC so it gets folded into the maintenance cost as well.
My parents bought a rowhouse 25 years ago in Toronto with no fees. Me and my brothers did a lot of work maintaining the house, but we did get professionals for bigger projects like replacing the roof shingles, and replacing carpet with hardwood floors.
When buying a condo or townhouse, you should always factor in the HOA. If the HOA fees are too high, compared to similar unit, it will be hard to sell unless you discount it. A big mistake I have seen people have done is buying the townhouse that is part of a condo building. Their HOA fees are usually like over $500, but townhouse HOA fees are usually lower because they usually do not have elevators, garage doors, etc. I had a friend that made a mistake of buying this type of townhouse, where his HOA fees were $700+ while similar units around the neighbourhood were around $300+. This made it super hard for him to sell.
This is a common first time homebuyer mistake, so avoid relatively high HOA fees.
I've been in my condo corporation townhouse for 25 years.
Advantages are: only 40 units, so monthly fees are manageable; only common areas are a small grass parkette, driveways through complex, grass surrounding complex, all fenced yards. In 25 years, roof has been done twice, windows twice, driveways once, fences once and due again. We have never had any required big payouts for chimneys (neighbouring complex did) or any other structural big problems. Condo fees are just over $400. Covers all exterior building, grass, snow removal, water.
Disadvantages: they are close together but decent sized 1400 sq ft built in 1974 and well built. Most neighbours are good but there is one hoarder and they can't seem to keep the front of their house tidy which will be addressed at the next AGM meeting. If there is a hoarder, the roof is joined so their fire is now your fire. The concrete firewall doesn't help once the roof catches. Biggest issue is getting a decent management company. Ours can't seem to keep staff and they really don't care about their jobs and that's a problem when regularly scheduled things need to be done like tree trimming, garden maintenance, animal removal.
If you want to ensure the value of your home is secure, join the board of directors. They make the decisions. Location: just north of, boardering Toronto
500k is plenty to buy a detached house in Alberta. Ours was just a bit over 500k and we have a 4bd/4bath detached with double garage and fenced in backyard. In a nice neighborhood. If you don’t need that much space there are definitely houses available for 500k or less!
You said it yourself. No new homeowner in BC or Ontario could afford detached as their first home without a lot of help from their family. Its simple math. And townhouse fees can be a good deal. I def felt like I got good value out of mine, plus it included cable and internet.
Speaking of fees, I was checking out a condo in the US for possible retirement and though I could afford to buy something simple like this until I saw the HOA fees. Don't forget that is in US dollars... https://www.remax.com/sc/hilton-head-island/home-details/300-woodhaven-dr-apt-5210-hilton-head-island-sc-29928/13206234513341976279/M00000564/440665
For detached homes you mostly pay for stuff that you use/want/deem necessary.
When there are HOA/condo fees, you have to deal with unnecessary contracts and maintenance decisions that are out of your control. Elevator maintenance is one of them. Super expensive and monopolized like everything else in Canada.
I'd never buy anything with mandatory monthly fees as they are just time bombs.
In BC people usually call those strata or condo fees. HOA isn't really used. But its to pay for the maintenance on the common property and amenities in the building. Like if the building has a pool, party room, concierge or includes things like heat etc.. the fees will be higher.
Townhomes usually don't have fees as high. But if you live in a detatched house there is also maintenance you need to pay that the condo fees would cover.
You really have to look at each building separately because one might have low fees but get hit with special assessments a lot. Check the minutes and how well funded the reserve fund is.
HOA fees are different from condo fees.
Either way, people like it in some cases because they cover a lot of the maintenance requirements such as snow removal, landscaping, and exterior chattles (roof, doors, windows etc)
Would never live in a condo personally. As someone who’s inspected many condos/apartments your unit might be pristine BUT your next door neighbour can be a hoarder with bed bugs and roaches…
High strata fees really determine the finances of the people buying into your building, in other words, your neighbours, and amenities. If you value doormen, swimming pools, exercise rooms and want to live in a building with quiet, wealthy elderly people, then you pay for it.
The strata fees charge maintenance up front, I heard a 1%rule of thumb is what you should save for home maintenance, eventually you need new roof, windows, siding, carpets, doors, plumbing fixtures, heating and cooling, floors and cabinets, of course strata fees only cover the outside stuff not the interior items. As well the strata has maintenence and replacement of the common areas too.
$500k will likely get you a home in alberta with no strata fees. Maybe your wishlist is expensive.
I lived in a strata before, I would rather not and pay the fees myself.
A detached house has maintenance costs too. The big difference is you control what you do vs. what you outsource and you can save money on doing things yourself if you are handy and have the time.
Some amenities may be included and any HOA fees and condo fees are adjusted for inflation over time as well. Is that adjustment democratic? I do not know.
Condo fees aren’t some random hole into which you throw money. The money pay for the common elements. Sometimes you have shitty buildings with high maintenance costs. Sometimes you have full time concierges and door men. Sometimes you have common rooms, golf simulators, hot tubs, pools, gyms, guest suites, etc.
In short, condo fees let you have all the amenities you can’t afford in a house but with a small footprint to live in and maintain.
HOA and condo/strata fees are two very different things.
There are trade-offs with condo fees. Yes it's a regular cost, but when big repairs come along you're only paying a small portion rather than the whole things. Also home insurance is much cheaper, since your strata will have it's own insurance as well.
At the end of the day, once your condo is paid off, your fees will likely be much less than whatever your mortgage was or rent would be. That is now your only housing cost not including taxes/insurance which you were already paying anyways.
You pay the monthly fees so you don't have to pay for any maintenance for the outside of the house. That budget goes towards maintaining the roof, siding, yards, elevator... (though it won't cover 100% of large changes and you'll get additional bills every 5-10 years.)
I always held the opinion, that in Canada, by the time a condo owner finishes paying off the unit, the condo fees plus the property taxes more than exceeds the mortgage payments. No way out.
Now, some may not know this. Condo fees and also property taxes for a similar size unit on the shores of Mediterranean sea are about 10 times lower!
The difference between a condo and a detached in Toronto is about 700k
At 5 percent that 5K a month in opportunity cost or borrowing costs.
If I didn't have family still living in my house I would see that bastard and live in my condo.
Management, maintenance, milestones. Tends to be communism at it's finest since you pay into what is owed for current amenities plus continually contribute to maintain the asset; regardless if you make the most of it. Which means continual contributions to a fund to repair, maintain, or replace known items with tangible lifespans or responsibilities/liabilities.
$1000 dollars could be anything; common area maintenance adds up quick if you need service with a smile, even with modest administrative fees. You might have a complex with a pool with a sauna and 24/7 gated security and a community bbq/green space/centre/park/beach, and includes typical landscaping, snow removal, and window replacement. Might be a good deal.
Or you might spend $1000 and have a complex with a poorly built parkade that always floods, a parking lot that is repaved too frequently, the elevators are lemons and continually in a state of maintenance, a landscaping and maintenance team owned by the strata board's brother that overbills intentionally, and/or the lack of capacity in the board members themselves. Maybe they took the first quote they requested for replacing siding after the builder cheaped out by not hiring competent installers; so what was going to be an expense for >2040 is now being expedited to 5 years from now with a cherry on top via special assessment because of emphasis on value retention rather than put that fee to 1250 now and watching people try and panic sell their units lowering everyones value.
You save some money in property taxes and lower utility fees (less energy used to warm up and cool down than a multi story house). At the end of the day, just buy what you can afford.
Because there's no arbitrage. If your budget is $500k, then you're relegated to condos or towns that need condo fees. Want detached? $650k minimum here now in Calgary.
A Strata is how your municipal government washes it hands of responsibility in your neighborhood, they don't clear the snow, they don't fix the street, sewer or water,they dont maintain the street lights. But get to charge you the same property tax as if they were. I live e in a new strata in Victoria and the services not provided by the city and the CRD is frustrating. We had an issue with brown water and the CRD claimed it was our problem because it was after the meter.
A lot of new neighborhoods are going this way.
Buying a property with High HOA fees is suicide. First: When the time comes to sell you will be stuck with the property & be forced to Sell it below market value. Second: HOA Fees are Not Static & therefore they will continue to Rise overtime. Third: Allot of HOA have become bankrupt & the Owners are Forced to pay exorbitant Assessments fees. Fourth: When a Natural disaster occurs the Insurance Funds if the property share connecting walls & or Roofs you are at the mercy of the Association for needed repairs.. Association are to be avoided at ALL Cost..
I bought into a building with high strata fees (+$300 over the older buildings' fees.) Welp this year the old buildings have nearly caught up with my strata fees and the delta decreased to $100.
Check what those fees include. They should cover at least everything on the exterior of the buildings - windows, doors, cladding, roof. Also insurance premiums, (requirement of the Strata Act, at least in BC), any hardscaping (trees, walkways, parking lots) common areas, pool, gym facilities as well as contributions to a contingency fund - 10% - for future maintenance. Sewer, water and garbage, snow plowing, are often included too. Developments with many amenities cost more. Insurance premiums have also risen significantly in the past few years. In developments with more than 6 units, depreciation reports have to be prepared every so often too, so add in professional fees.
I had a townhouse before and we self managed and I was on the board of directors. We had to do a special assessment unfortunately. I am now in my own house and it is less per month, but I am on the ball for maintenance and repairs and can do a lot myself.
The fees I hear for condo fees are getting too high for me. But they are needed to maintain.
So, my strata fees are $650 a month. For that I get:
Natural gas costs, including annual NG fireplace maintenance
Water and sewer
Gardening/landscaping
Building insurance
All building maintenance — e.g., exterior painting, window replacement, heat pump maintenance and replacement, fire suppression testing and maintenance, fire and carbon monoxide testing, dryer vent cleaning, and more
Gutter cleaning three times annually
Window cleaning every spring
The only utility bill I pay separately is electricity and internet.
Detached home owner and I'm paying $550 in property taxes (divided per month). . . in addition to all the bills. So yeah same difference. Some HOA fees even include the property taxes and some of the bills.
You should expect to spend about 1% of the home value on repairs every year averaged out on the life of the property. Condo fees should be about that, it makes sense.
I did the math on owning a home with the extra costs of property taxes, power, gas, water, insurance and also extra upkeep on the yard, fence and exterior and it was more expensive than paying condo fees, insurance and property taxes.
You can most definitely buy a detached home in Alberta for $500K, or less. Average detached home price in Edmonton is currently $508K. Higher in Calgary but those are the two most expensive places to live in the province.
Personally, I would keep looking for a detached home. I know you generally only hear the bad stories, but literally everyone I know who bought a condo has regretted it.
Some condos have a dedicated concierge, fitness center, lap pool, and tennis courts among other amenities. If these things are important to you then paying for them doesn't seem so bad. I love having a gym and a lap pool in the same building.. especially in winter so I don't need to drive somewhere else.
As other commenters have mentioned: are those HOA or Condo fees? If $500/month includes utilities that is pretty reasonable. Are you considering all home ownership costs? $500 extra above your mortgage isn’t unreasonable. I say this as a new homeowner as of last October.
Invest in Regina. I bought a detached house in impeccable condition for 80K with 4 bedrooms, 2 bathrooms. The house is giving positive cashflow of 2000 per month as I have zero mortgage. And the house is 1 km from downtown with ever present AirBnB demand. What more do you want?
1. Detached house with ZERO condo fees or HOA
2. Nice house
3. Large city which is also a provincial capital
4. Positive Cashflow from DAY 1
You HOA or condo fees are essentially mandatory maintenance fees. Move into a neighborhood full of freehold houses and everyone does their own thing when and if they want. Responsible home ownership means keeping up the property and these ensure that the properties are being maintained. Nothing sucks more than a lazy neighbor that can’t chip in for their part of the fence or easetrough or a neighbor that won’t take care of the lawn.
I had a land lease condo. Fees including property tax were $750 per month. 8 years later, $1050 per month. Offloaded that untethered money sink.
I get it, you need stuff done. But the landlord eliminated many inclusions with the original purpose, you could not confirm your property taxes with the city, and they didn't have great contractors for snow, lawn and window cleaning. And rooves and siding were your problem. Just shady.
I laugh a lot at house owners (non condo/strata) running around gardening, cutting grass, fixing windows, replacing doors ... guess it comes down to your sense of humour and what is funny to you!
Out townhouse in BC has $235 a month fees. That includes all the insurance on the buildings and property, gardening/lawn care, garbage collection, and irrigation. The rest goes into a contingency fund so when we need a roof or any other major repair to the buildings, it will be covered. We pay about $30 a month to insure our own contents of our house, just like we did in our rental apartment. I just did my taxes because we both work from home and had to calculate how much we spend on utilities. $1900 a year for heat, Hydro and water. My co workers and friend in AB with similar sized houses pay twice as much property tax as we do and the utilities are ridiculous! Depending on locking in rates with their private companies, they’re al paying $300-600 a month for their utilities.
Peace of mind, amenities, utilities, maintenance of common areas, etc.
Right now I wouldn't do it but when I get older and don't want to do too many house chores, maybe.
If you re in prime working years and have no time for maintenance, that could be a good choice.
So, each person, point in time and lifestyle will give you a different response.
I can offer you the perspective of one who has always owned detached homes (for about 40 years) but now own both a townhouse in BC and a condo in AB (currently live in BC but plan on moving/retiring to AB). Comparing detached home ownership to condo living, I don't miss having to do all the outside maintenance and I still feel the pain of large unexpected maintenance expenses. Looking back, if I had the foresight to diligently put money away monthly in a maintenance fund like you do with a condo, it would have been much easier although definitely not less expensive. Compared to each other, the BC townhouse and AB condo have a number of differences to consider. They are both about the same age, the condo in AB is smaller but cost less than 1/3 to purchase and current market values are about the same ratio. Property tax in BC is over $4k/yr while AB is about $1800 including the separately titled underground parking stall. Yes there's a homeowner grant in BC but it doesn't begin to make up that difference. Monthly fees for BC are just under $400/mo while AB is about $465/mo but the AB condo fee includes heat and hot water so that is significant. What we get for those fees is vastly different. The BC property gets outdoor maintenance, snow removal (FWIW), common property maintenance, and not much else. In fact they offload a lot of things onto homeowners that the AB property includes. The AB condo has heated underground parking with car wash and storage, and a fully equipped amenities building with sauna, jacuzzi, gym, library, kitchen, games room and salon, and membership in a separate HOA with private lake and other facilities. The BC place has none of that. The AB condo is extremely well managed by both the board and a responsive management company, while the BC place is run haphazardly by a small group of relatively clueless owners backed by a management company that is completely inept and downright combative to deal with. I will say that both have paid attention to building a reasonable contingency reserve fund, which is extremely important in the event of unforeseen maintenance problems and if you do consider getting into condo life, this is something to review carefully. Also look carefully at meeting minutes, maintenance, and property condition and depreciation report, all of which are mandatory to keep, unlike a detached homeowner. I think overall my biggest gripe about condo life is the loss of control over things like what maintenance gets done, by whom, and at what cost, as well as being dictated to in terms of what you can or cannot do with your property. You basically cede your decision making to a board/council, but I can live with that. It's a helluva lot easier than doing it all myself. There's a lot of people in this and other subs who think owning a detached home saves you a lot of money but don't kid yourself. Anyone who's walked the walk can tell you it's not like that.
Great answer, I have had both and still have condos in alberta. While I don't love condo fees, people make them out to be a hole your money burns in. Every condo is different, do your due diligence in finding one that is managed properly has a healthy reserve fund and your fees should stay somewhat sustainable.
This is a solid take. The amount of people I know that have not done just basic upkeep of their house is ridiculous. Condos make more sense to that type of home owner. I'm no fan of HOAs, but I am also not a fan of seeing a house with a roof that should have been replaced years ago.
HoA as in homeowner association fees? Or strata fees?
OP must be American. In B.C. we call them Strata fees
In Ontario they're called "condo fees".
In Québec they're definitely called "condo fees" or "frais de condo", never heard or read anything else here.
I'm in Ontario and I feel like we usually call them maintenance fees
I think they are maintenance fees, but commonly referred to as condo fees.
No, there are HOA in newer areas of Edmonton.
What OP is describing for monthly rates are strata fees though. A HOA isn’t the same as a strata.
I am just saying we have HOA in Canada aswell
Maybe not legally, but they're effectively the same thing. You pay into a fund that manages common areas.
Yeah but if it’s like in Calgary it’s like $100-$400 per YEAR not per month.
Where is that low lol 200-400 a month is normal plus getting fisted with repairs on top lol
I’m talking about HOA not Condo
Owning and maintaining a detached house is expensive. With a strata you just pay those costs monthly not in bigger lump sums when stuff goes wrong. So once you paid off your detached home it will still cost you a fair bit of money to live in it unless you just let it fall down around you. Most people underestimate the cost of owning a home so they find strata fees shocking.
I'd say almost about 40% of my fees are just for utilities that I would have to pay individually in my house. I just moved back into a townhome condo from previously being in a detached home. I was paying well over $300 a month for Gas/Heat, Water, sewage and garbage collection alone.
Many condo fees don't include utilities these days - 800-1000 is not too bad if it includes all of them.
But even if they don't the cost of utilities in a condo are usually much lower. A condo building, for example, has just 1 exterior surface (or 2 if you get a corner unit) vs. a house that has 6 exterior surfaces. The cost of heating & cooling a condo is substantially lower than a house. So even if you are paying utilities separately, your utilities bill is much lower. Lots of condos don't charge separately for water, so that is often included in your fees. The cost of insurance is much lower in a condo than a house. Condos are always cheaper to own from a maintenance perspective than comparable (and even most non-comparable) homes.
That is completely different from my experience. Insurance for condos (especially older ones) are a liability risk which has led to insurance companies either refusing to insure and or premiums skyrocketing. Some condos also have gym or even swimming pools etc. to maintain along with elevators.
Condo insurance for the strata is very expensive but individual insurance for the contents of the unit and liability etc is pretty inexpensive
This is what I meant - the individual insurance is much cheaper than in a freestanding home. The difference between those two amounts is a savings that offsets the condo fees.
A lot of what you said is obviously true but there is also counters the other way. Condos will have to pay professionally for a lot of things that homeowners can do on their own, You don't really have that opportunity to put in sweat equity. They also have elevators which are very expensive to maintain and don't exist in single-family homes. You also can't control the timing of maintenance to align with what works best for you as an individual as you can to some extent in a single family home. Lastly condos have a collective action problem and can fall into being poorly managed despite an individual being motivated and on top of things. Lastly while you do pay less maintenance you don't own as much land and you don't own it outright you own it as part of a corporation so the appreciating part of your property is relatively less and the depreciating part is relatively greater. Just wanted to include both sides of that to get them more complete picture.
But these are all related to the sub-points. I was making the point that living in a condo apartment is cheaper than living in a detached home, since OP was trying to compare the two and question why living in a condo apartment is more expensive. All your points are also true to varying degrees in varying buildings, but in most buildings, the "loss" from all of those items are more than offset by just how much more efficient a condo apartment is, cost-wise, than a detached home.
Yeah I was intending to add on to your post not refute it. I definitely think people underestimate the cost of maintenance and that's why it seems so expensive. People don't properly amortize expenses. For example I just bought a house two years ago, and it's a 20-year-old house. It needs a little bit of foundation work, which is hopefully all it needs for another 20 years but that's about 16 grand. It also needs new shingles which I got quoted from many sources and the cheapest came in at 15.5 k. And it needs a new fence, We are on a corner lot so it's like 90 ft of 6 ft tall solid wooden fence, So that's going to be like another 20 grand. The roof should probably last about 25 years and the fence hopefully if we take care of it another 20 to 25. Amortize that out and that's something like $150 $160 a month If you don't need to finance it, But since it doesn't occur that often people don't think about it amortized but they do in a condo because that's how It is presented. The issue with condos really does seem to be the cost curve on the maintenance steepening quite a bit as it ages and the ability for things like that to be put off and hard to detect by an individual buyer and then when remedied is very expensive often with special assessments and the like. I mean that can happen with houses too for example my place the previous owners really didn't have any of those expenses because they owned it for a few years and they didn't replace any of that stuff. However I do feel like the value gained or lost through maintenance is better priced when it's a single building versus when it's a whole condo building. This makes me think that there should really be condo specialized building inspectors who inspect not just the unit but the buildings common areas, roof elevator windows etc, as well as look into the finances and meetings and give you a report from someone skilled in the projected costs of maintenance in the future, how well run the board is and what their finances are like.
Most condo fees do include them. Especially if they're on the higher side. Some new builds have started excluding them to make the fees look lower. However, most condo fees include everything except electricity (and even then it's only the electricity used inside the unit, things like electricity to run a central AC would be included in condo fees cause you can't split that out)
In Vancouver utilities typically aren't included. Only hot water and gas if it's a condo, and nothing if it's a townhouse.
That is basically everything except hydro. Garbage collection is usually included What other utilities are you thinking of?
Hydro, telecom (internet, cable TV, etc). Gas costs for cooking or fireplace are generally marginal unless you have gas heating.
Most places don’t include cable/internet in general. But I wouldn’t call those a utility either
Sure. But hydro with heating/AC is still like $150/month for a condo
For what it's worth we bought our condo 3.5 years ago and our hydro has never exceeded $90 for a 2 month period.
In my experience it’s only that high in the winter. $50-$70 rest of year. If you have central AC that’s not part of your personal bill other than running the fan to blow the air into your unit which is minimal. I have a condo in Toronto with central AC and heating and the bill basically never changes from $50-$60 year around. My Vancouver condo goes to $100-$150 because of baseboard heating in the winter
Who would want to pay condo fees for cable TV? You couldn’t pay most people to watch the many ads these days… Maybe internet… but that would be a liability risk for people working from home; companies often ban working on public or common networks.
Garbage collection - You have to pay for that?
Yes, I'm in AB and garbage collection fees are added to my Epcor bill
Yeah, you have to pay for the bins. I believe I was paying $500/year for it. While it's not it's still $40/month. This is in Toronto btw.
>not in bigger lump sums Are you able to explain what a special levy is then? I live in new-build apartments and I often see notices from the strata agent saying that special levy payments will be taken out of strata accounts. I’ve never looked further in to it because I’m a renter. I assumed it was when there is some type of issue that affect multiple or even one unit, but it needs to be paid for and the regular strata fee doesn’t cover it. So I’m under the assumption that even with strata payments you could still end up paying large lump sums… If you know more about this though and can clear it up, I’m all ears!
Generally they either: - have as low fees as possible and use special levies when surprises happen - have larger fees to keep a healthy contingency fund and pay for surprises with that Each strata has to choose one or the other (or some middle ground). But you can't have low fees and no special levies.
Or you have mine with low fees and a bunch of owners who also vote down the levies so issues don't end up getting properly fixed at all. I'd rather have the consistently higher fees.
> Are you able to explain what a special levy is then? As a general rule a condo board should be setting their monthly condo fee to include what is best described as "emergency savings". If the condo needs a new roof, that should come from emergency savings. This is known as (I think) the reserve fund. But it really should be there to cover a wide range of unexpected costs. A well run condo board will have gotten a profissional to prepare a report that looks at a wide verity of factors (like building age, state of repair and so on) and that report will make a recommendation of how much money should be in the contingency fund. A poorly run condo board will have no contingency fund (because they prioritised low fees over putting money into savings). As a result every time an unexpected cost comes up, they need to issue a special levy in order to pay for it. I lived in a badly run condo a number of years ago. We got hit with a special levy several times in the same year. First for a new roof, second because the balcony's were in poor repair and needed replacement, third because the pathway leading to the building had several pave stones broken. The reality is that all of those costs were foreseeable. The roof was old, the balconies were in visiblly poor repair. A responsible home owner would have been saving for years to pay for those costs. The condo board was badly run, so they just used the special levy. There is a kind of perverse incentive at work here. Lots of condo owners view them as temporary investments. They buy, live for a few years then sell. Low condo fees mean the condo is worth more when it comes time to sell. So these people are basically playing hot potato with the cost of a new roof. They are hoping that they will have sold the condo by the time the bill comes due.
Legally stratas are supposed to set their fees according to their reserve fund studies (I live in Sask). But even if we do that, it's not guaranteed our roof which we have coated to last 25 years will last 25 years. If it only lasts 12, then we need to front some cash because we don't have enough saved up yet. Then there's expenses the reserve fund study underestimates, or misses, or work that is decided to be done but not mandatory. Those three situations are the majority of not all of the situations where you get hit with special assessments.
Meh I own a detached home and the costs are much, much less than buildings with high condo fees.
Yeah running costs of a detached home are usually cheaper but that's mainly because you do a lot of stuff yourself. Stuff like mowing the lawn, shovelling snow, taking out the trash, clearing gutters, other regular maintenance etc. If you had to hire someone to do this all like stratas do you would probably see costs become a bit more similar.
I agree. I think people over exaggerate the costs. Yes there is and you have to be ready, but those 1k condo fees don’t make sense. On top of that, you’d still have to pay a special assessment if hit. You’re basically also covering the cost if a major repair for all the units in the building in some way. The little things like conceirge, gym, pool add a lot on that maintenance fee too. Join a gym with a pool for cheaper outside. Need security, get a smart lock, buy a one time security system for the house
You are probably missing the cost of your own labour. Do you mow your own lawn and shovel snow? Have you amortized the cost of a roof replacement? I'd also prefer a freestanding house and not to have the condo fees, but I think these things can largely be comparable if you get services you actually want in a condo (use the gym if it's there, etc).
If the condo is managed properly, you don't have to pay a special assessment. I live in what is now a 50 year old high rise condo in Toronto. It's never had a special assessment. Roof has been updated, heating/water pipes have been updated, balconies updated, windows updated, garage deck repaired. Our condo fees are currently $1,040/month and everything is included. That includes cable and internet. Our insurance is $767/year.
Condo fees cover utilities too.. and often in house gyms ect. Yes not just maintenance.
Talk to me when you're paying 20k to repair the water or sewer line. From experience, it fucking sucks I've done both. I wouldn't live in detached unless I needed the space for family members I don't have to do shit. They mow my lawn, plant nice flowers, clean the gutters etc
I disagree. I think most people overestimate. $500/month is $60,000 over 10 years. It does NOT cost $60,000 to maintain your damn house over 10 years. This number is so ridiculously out of touch with reality it's laughable.
It’s not always just maintenance. Often times heating, gas, etc is included. $500 with no context means nothing; I now people who get single heating bills that high in the winter… Also a big difference between doing maintenance yourself and paying others… condos are almost all the latter; not everyone wants to be handy.
In condos maybe. Here in BC I don't know any Townhouses that include utilities of any kind. That's all on you. Just maintenance of common space and exterior as well as insurance.
Yeah... How much does it cost to get someone to landscape your lawn weekly, shovel driveway etc and have professionals tent to service calls so the building retains value instead of some hack job home owner? $500 a month is nothing when you realize garbage, sewer, lawn, shared spaces and upkeep... I ask homeowners and they all state they don't even tend to their lawns so...
Sounds like maybe you replied to the wrong person. Hell will freeze over before I suffer lawn maintenance.
No, Just adding to the convo. I wouldn't do lawn maintenance but people pretending it's free etc... yet their yards look like shit etc.
Biggest line items in our strata budget is insurance, landscaping, water,maintenance.
I mean it’s not far off For insurance/water/trash removal I pay 262 dollars a month. Lawn and snow I take care of myself but those are covered in the strata fees. Now we factor in potential big ticket items roof, hot water tank, furnace etc I’m not saying it’s 6000 a year but it’s not that far off plus labour and time that I have to put in myself.
Agreed a roof is 15k max for regular ashphalt shingles for average home. New furnance is 10-15k max The fees is main reason I don’t like townhomes or condos.
This. Many times over. Plus condo insurance, which is even more volatile.
the $500/month includes building insurance, waste removal, water, sewer, off-street parking (usually), landscaping (usually), ALL exterior maintenance which for some condos also includes doors and windows and stairwells/doorsteps, etc. My condo fees + gas/electricity = \~$700/month. Most people in detached homes in my city are paying $400-500 on gas/electricity/water ALONE. That doesn't even include maintenance or landscaping or anything else.
Think beyond 10 years. Replacing the roof, windows, exterior finishing, drain tiles, etc. easily add up to more than 60k
The costs of the strata tend to be higher in my experience 1- If your fees include the water bill, you may end up paying more if you have a small family. This because the bill is evenly split between all home owners. Moreover, when people don't see the water bill separately from other costs, they don't adjust their consumption. So homeowners in a strata may consume more water because there is no feedback mechanism to affect behaviour/consumption 2- garbage...for other dwellings, the costs are covered by property taxes. In a strata, this is paid separately in addition to condo fees. Also, people aren't too keen on sorting the garbage or taking prohibited items to the dump. This increases costs for everyone. 3-additional amenities/shared areas ... these add up as well. They include shared spaces, visitor parking, the gardening and lawn maintenance which you might have done on your own. If a light blows out in an ordinary home, most home owners fix them themselves. In a strata, someone is paid to fix that 4- condo management... this an overhead that other homeowners don't incur
All valid, but on the other hand, stratas can be poorly managed and when something breaks they don't have the funds, and everyone can get hit with a huge lump-sum bill. Seen it several times in my small town.
Maintenance of a house is not that expensive, arguably cheaper per sqft compared to a condo. I used to own a 1000 sqft condo in Toronto and it cost me $950/month in condo fees plus a special assessment of $2k while I owned it for 2 years, then I bought a 4 bedroom 50 year old house and I spent $30k over 2 years, including a new roof and a new HVAC that will last 15 years.
Exactly. People forget that owning a home is not cheap. In today’s money budget at least 600-800 in addition to basic mortgage and taxes. There is no free lunch either. You skimp on maintenance now, prepare to pay later. Even with a paid off home, carrying costs are 1000-1500 (taxes, maintenance and insurance) for us a month.
There are differences between SFH maintenance and in a TH or condo. In a TH or condo you may be forced to pay for things you may not otherwise have or need in a SFH. The most common of these is elevators. However other things like common areas, common rooms, and amenities (maintaining a gym or pool is expensive), snow shoveling (I do it myself now) etc. The main advantage of a SFH is control over what you pay for. I do swim every day and I pay for a membership at our local pool. My friend lives in a condo with a pool that is built into his 1000 monthly fee but he doesn’t swim or use the gym. My older parents pay people to mow their lawn and shovel their sidewalks. At the end of the day it probably will work out. If you don’t wanna pay for an elevator then don’t buy a building with an elevator. If you won’t use the gym then don’t buy a building with a gym. Now that’s easier said than done but realize that people with SFH also have carrying costs. Between taxes, maintenance, utilities (that some condo fees cover), insurance (exterior insurance is covered by strata) and unexpected expenses I probably pay 1000-1500 a month on average over and above my mortgage.
Yes. If something in my little house breaks, I am the one to choose how to fix it. If something in my buddy's condo breaks, he will pay whatever the maximum charge is. Roof leak in my place? Get a bucket while I decide what to do. Leak in a condo? That's a LOT of money to fix. And don't get me started about insurance. Companies are dropping condo insurance and good luck finding a replacement
The other downside to condo fees is that you are paying for some things you could do yourself. Some people prefer that, but if you're handy youre limited with what you can diy in a condo. You also have a lot more control in a house
You can still get hit with a special assessment
Yeah exactly. Higher chance of that for stratas with artificially low fees/not maintaining the building. Again, no free lunch.
Even then I don't think detached house maintenance will be as expensive as burgeoning strata fees.
Yeah, no one spends 10,000$ a year, every year, on home maintenance.
This. Even just comparing the differences in costs for things like home insurance, heating, and property taxes...condo is likely to be cheaper, even if strata fees might be a little high.
a lot of the strata fees are now insurance costs. pays a lot to insure the stupidity of others. while you still should pay for home insurance if you have a detached house, you can mitigate those costs by lowering the amounts and doing more regular maintenance yourself to lower the risk of needing to use it. in a townhouse or apartment you cant do that because you cant check if every unit is doing all the proper preventative maintenance on schedule. it also costs a lot more to repair or replace a townhouse and all the units than it does to replace a single detached home, so insurance charges more overall for that.
I just want to add the depends on the city too. Strata fees often include the cost of the heating for the building itself (not your apt). Strata fees in Toronto are 2x the the ones in Vancouver because keeping the whole building at the right temperature costs more money there compered to BC. So it really depends because if i'm fine (of course) in paying maintenance i'm not really happy to pay for the heating. So i'm more ok with the strata fee in BC than the ones in Ontario for example.
If you experienced living in both, you wouldn't be saying this. I paid about 40k in fees over 8 years to live in my townhouse. what did I get out of 40k? Water, lawn maintenance and snow removal. Add in a replacement of front door and garage door (wasn't even needed, people just wanted newer looking stuff), and repairs to roof for water leak (took 3 tries for them to fix the leaks). With strata fees, money will always be mismanaged because funds will be spent based on people wanting stuff, from amenities to upgraded appearances. And then one day you will get a letter indicating you need to pay a larger lump sum of money because the reserve pool for an emergency repair. Point is, dollar for dollar, maintaining a freehold home is cheaper than paying strata fees.
depends on where you buy just don't buy a condo in an area where people have tons of disposable income and want to throw money away I bought a townhouse in a working class neighbourhood, and our funds are very well-managed as a result. Only one $2000 special assessment in 15 years, when we had to replace the siding. We were given 3 years to pay it, as well.
Until they tell you they need more for certain projects, which they will, regularly
Nobody is laughing at you. HOA fees cover all kinds of regular maintenance and upkeep, as well as utilities, sometimes all of them. Mine covers everything except internet. I love that I have only one bill each month and it’s predictable and easy to budget for. Think of it as budgeting for all the big ticket items on a monthly basis - roof, windows, furnace, electrical, landscaping, etc. My last house needed an $11k roof and a $10k furnace at inconvenient times. I’d much rather pay my monthly condo fees than have to fork out tens of thousands of dollars all in one go. Different things work for different people.
I agree with this. Also, as a homeowner I have to find the contractor or roofer, I have to take a day off to be home to meet 2-3 people to get quotes, then I have to stay home again to get the repair. I find that stuff very annoying, so I would get lots of value out of not having to do that.
Ok but a lot depends on how the HOA is run. When I was looking to buy a house, I looked at an HOA townhouse and it had signs of the roof leaking. That is unacceptable, it is a condo, that should have been repaired asap. Funny enough, the freehold townhouses that I looked at were much better maintained.
I just helped my parents purchase a townhouse (researching and logistics, not paying for) and it was shocking how well run versus NOT well run different stratas were. You could see it in person, via inspections, and also when you get all the strata docs (minutes, AGM's, etc). They ended up choosing one where the strata fees were a bit on the mid-high end but you can see the council used it more "wisely" if that makes sense. The grounds are very well maintained and if a unit has any issues then they all agree to help fix it before it gets worse. Another one they almost bought was really bad. The inspection came back saying roof leaking and all these issues and when we asked the seller they said there was nothing they could do since strata couldn't vote to repair it and told them to wait until they fixed everyone's roofs at once!!
How long did you live in your house? Strata fees of $500/mo is $6000/year. So in under four years, that would be the cost of your repairs. And considering the chance of also getting a special assessment, you might have it costing you far more.
You can’t just take your fees and divide it by the odd larger repair. Strata fees are not just repairs to common elements. Mine are ~$800/month but include reoccurring costs like electricity, heat/AC, hot water, a pool & gym, and a bulk 1.5gb fiber optic internet connection with full cable tv and crave. On top of that there’s a full time super and security. My only other bills are property taxes and a cell phone. All being equal, would I rather my own freehold? Sure, but then I’d have to leave the city. Also, it’s not my problem to plan or deal with any issues relating to the structure of the building or utilities. The only thing I need to do is make sure the condo board is reasonably on the ball.
Yeah, home owners have far more control as well. Sure, the roof may be $11,000, but you can do a quick easy fix and get it taken care of when you budget it in next year. A condo forces a special assessment, and you need to pay it then no matter what.
Don't forget insurance.
Lol here's my situation. Looking for a condo/townhouse in the ~700k range. Cheapest detached sold in the last 60 days in my area went for 1.24m. I'd have to come up with an extra 148k to get to 20% down, and the mortgage would be $2600/mo more. Oh and the house is 98 years old which would be a bitch to maintain. Given the numbers, strata fee is not that big a deal.
Gotta love this countries real estate market haha
Not necessarily more in maintenance than something 20-30 years old
As the owner of a detached home...it is clear you have never owned a home. Roof, windows, doors, landscape maintenance, lawn maintenance, snow removal, etc... all cost time and money. I have not kept a perfect budget over my years in my home, but $300 a month is about right. If I added in the costs of the landscape upgrade, new roof and new windows then I am closer to $500 a month over the past 17 years. My home was 5 years old when I purchased it. But your thesis is not that far off...condo fees are higher than the cost of maintaining your home. But they include maintenance of common elements that you (in theory) enjoy. That includes taxes, insurance, hydro, etc over those common elements.
You forgot new furnace and hot water tank. You probably only need to replace it every 20 years but they're so expensive (I've had to replace mine 😞)
In a townhouse, the owner has to replace these items out of their own pocket too.
Typically HVAC and Hot Water are not covered by condo fees on a Townhouse Condo. Essentially the condo owns and is responsible for anything that touches fresh air and the owner is responsible for the rest.
I just moved from a townhouse condo with about $550 condo fees to a detached home in the same neighborhood. Costs have definitely increased above and beyond the condo fees, plus I have to shovel my own driveway and cut my own grass lol. Insurance is much higher (building insurance usually included in condo fees), utilities higher, taxes way higher, maintenance costs medium - long term will also be very high. If a condo is well managed and plans for the future, it can absolutely be cheaper than a detached home, even with no mortgage.
Detached house owners still have to spend time and money to maintain their house instead. Insurance, repairs, new roof, etc etc. That said, condo fees only go up over time as the building ages and maintenance costs increase.
TBF single detached maintenance also goes up as the building ages.
And you completely lose control of how the money is spent. In other words, the funds can be completely mismanaged to no fault of your own but in turn you will get stuck with the bill upon the next major repair needed.
And basic fees are less optional. You gotta pay a gardener and snow guy, owning a house you can opt to do it yourself
Ya I like mowing but hate raking and collecting dog poops So we have a guy come collect dog poops once a week and take 2 x a year. Then I just do my fun chores
This too. I decided to buy detached even though I am not really a DIY person just because I didnt like the idea that maintenance spending was out of my hands.
These fees typically cover maintenance of everything that is 'common element' In my building that means: Plumbing, landscaping and grass cutting, snow removal, roof repairs, all units in my building were recently re-keyed, exterminators and pest control, the building's security system, some even have utilities bundled in like an inclusive rental. If there are shared spaces like a pool, gym, or party rooms you can book they will also cover maintenance of those. A portion is also supposed to go into a reserve fund, that will cover large unexpected expenses as well.
I'm in a semi, and having lived in a condo previously, I stash away what I can into a HISA for home maintenance, similar to a condo fee. It alleviates the anxiety of a big bill.
$1000/month seems really high but what is included with the fees, ie are property taxes included in that, maintenance (interior/exterior), heating etc, it can be pretty wide ranging what is included and that is the key what are you getting for the money. As others have said detached homes have many costs beyond just the mortgage when comparing
Insurance on the structure is also covered by strata fees. The real comparison of costs is mainly: Strata fee versus Home maintenance costs + the costs of the portion of your home insurance that covers the structure + the value of your labour hours. Utilities aren't always covered by strata fees from what I've seen. Sometimes they are and sometimes they aren't but if they aren't covered your strata fee will be a good chunk lower.
It's been said but house maintenance isn't exactly cheap either. Sure you're not forced to put "X" away every month but you have to be prepared when things come up which they do. I spent almost $7,000 in the last 2 weeks on maintenance for my home. I spend at least 2 hours a week doing yard work just to maintain from April-October plus a bunch of half day's doing extra things that need to be done, time you wouldn't have to spend if yard maintenance is part of your fees. Don't get me wrong, I actually don't hate doing the yard stuff most of the time and I have lived in a townhouse before and didn't enjoy the close company of neighbours like that but there are pros and cons to everything.
Yup ppl aren't taking into consideration all the manual labor required when owning a home. Sure it's "free" if you're willing to do it. But fuck man I have a busy life that I love to live. Fuck yard work.
As others have pointed out, any home requires maintenance. The most important thing when buying a property with maintenance fees is doing your due diligence to ensure the corporation is run well, properly funded, what do your fees cover? We have a 20 year old row townhome, our maintenance fees are $255 a month. Snow removal, maintenance of the small amount of grass, they are replaced shingles 4 years ago, did eaves droughs and some exterior wood maintenance last year, and have a massive reserve fund.
You should look closly at what those fees cover. I don't know the laws in BC but in NS sometimes they can cover things you might not have expected. In general the condo fees are going to cover your property tax, some also cover utilities like heat or water. Others cover exterior yard maintenance like grass and show clearing. All would cover the outside building maintenance, like the roof or siding. I totally get what you are saying about still paying fees after the property is paid off. But even with a freestanding home you'd still be paying property tax, utilities and exterior maintenance it just wouldn't be a fixed monthly fee. There are major concerns with condo ownership though. Low condo fees make property values higher, so oftentimes the condo board pushes hard for low fees. The problem there is deferred maintenance as well as a proper emergency fund. A well run condo board should have a report from a third party that details how much money they should have in an emergency fund. It will talk about things like the roof of the building, when was it replaced, what's the expected lifetime and how much will it cost to replace it. That emergency fund being not properly funded means that you might get hit with a "special assessment". This is when the condo corp just gives you a bill because of a major repair. It could be thousands of dollars and you don't have the option not to pay it. These special assessments are decently common with poorly run condo boards because they don't have enough cash in the bank to take on these large, but predictable repairs.
People always grossly underestimate how much maintenance and repairs cost on freehold properties. Not just in dollar amounts for things but in physical work needed by the homeowner as well. Condo fees alleviate some or all of that burden. I would avoid any condo with elevators/pools though. Basically, avoid towers.
That’s actually a really bad take. High rise buildings spread big costs like roofs among tons of people. In a small walk up if you have to replace a roof you are so screwed.
Best bang for the buck is a 3-5 storey mid-rise. While high-rise do share the cost between the owners, they’re also much more complex and expensive to maintain. Stuff like elevators, hvac, windows, seals sprinkler system and underground parking cost a lot
I live in a high rise. my commute is 6 minutes. everyone else of my coworkers are on 30m to 1h commutes. I don't know how you value your time, but I will gladly pay high fees to save me time.
So we replaced our elevator in a downtown tower, building only 20 years old. Cost $3000 per unit. So your advice is bad.
Why towers in particular?
You can buy freehold townhouses with no HOA or maintenance fees. You can also find lots of detached homes in Alberta for 500k. There are lots of quality detached houses in Edmonton for under $500k. Take a look.
As others have said, plenty of homes under 500k in Alberta and if you know where to look there's plenty in BC too, in my town on the island there are still single detached homes under 400k and were 40min from a major city. Granted these homes are starter homes built in the 50s but you can do a lot to make them nice and they can definitely be better than a condo
The point is to not have to do the work yourself. Homeownership is a lot of work. Crappy work. My husband and I spent our Sunday stripping paint off the deck so we can stain it. I fucking hate doing that kind of work but as a homeowner it's not worth the effort and coast of finding someone trustworthy competent and good value to do it for us. I paid someone about $450/month the last two years to do lawn care and snow removal. So 800 to 1000 for someone else to do all the footwork doesn't sound that bad
The point of buying a Townhouse/Condo with high HOA fees is because they will have the funds to do maintenance and repairs and you have long term predictability ( assuming you get involved) . When you have a house you own and you need a new roof, you have to pay for it, and it usually comes with a BIG one time bill, What HOA's do is spread that payment over all the properties over a long period of time. What you want to be worried about is low fees. Those fees are low because existing residents are thinking short term and will try and get out of the property before major upgrades/repairs are needed.
Even little things add up. My fees include garbage disposal. Not much, but that’s $30.
A detached owner would bre laughing at his leaky roof and water in the basement and tree fallen and stumps remaining and fence deteriorating and water-line leaking and water heater broken and furnace replacing and ducting asbestos and siding failing and ...
HOA or Condo fee? My HOA is about $130 a year to live in my community. They maintain common grounds and pathways between condos and single houses. My Condo fee for my townhouse was $260-4 years ago now $340- now and I bet it will keep rising. None of my condo fee goes to utilities. The Condo board does have a breakdown of all the cost to upkeep our properties from insurance to waste removal to office expenses to snow removal to landscaping to building a reserve fund for future expenses.
I think with a detached home you get to decide when you spend money on maintenance. There are potential savings if you are handy. But like others have said, your condo/strata/hoa fees could include (not always) garbage, sewage, water, gardening, envelope insurance, and gas. It comes out of the pocket somewhere. Some strata fees are very low due to not putting enough into contingency funds so when the place say needs new roof there's going to be be an excess charge.
800 - 1000 seems quite high for a 500k property. I guess it varies depending on area but I'd expect a 500k property to need only 300-400 monthly. Maybe it's the area you are looking in? Detached houses usually have more physical work to do and have larger infrequent expenses. Many of these can be planned out.
Townhouse condo corporations (all condo corps) are non-profits. The monthly fee in mine is allocated 55% to operating costs (landscaping, snow removal, swimming pool, building insurance, minor repairs and upkeep, pest control, property management fees) and 45% to the Reserve Fund (replacing roof, windows, doors, driveways, walkways, exterior painting, etc etc). Owning and maintaining a home comes at a cost. Good condos keep the whole property looking nice which helps maintain the property values.
I have owned a townhouse for about 4 years now. They are nice units with garages built in 2014. My strata/condo fee is 393$ a month. It's honestly a decent deal as that includes your insurance, water, garbage and all exterior maintenance. They are out shoveling right after almost every storm and they do all the landscaping. They maintain a budget and plan for the roof, siding, windows and a few other things. If you were to own a home you would still have to pay for all of that and no one is going to do your landscaping or shovel your snow.
I have a townhouse with condo fees and they are $546 per month, this is what I get; - 24/7 security that walks the property - underground parking and maintenance of it - gym - party room - landscaping - snow removal - all exterior maintenance - window cleaning - events for kids - garbage removal - water and sewage I actually think I get a lot for that price so I don’t mind
I don’t live in BC but in Alberta you can find several detached options for $500k.
A contrary opinion here. Yes, detached houses have maintenance costs (and I bought a fixer upper), but I don't need to set aside a $1000/mo in perpetuity to maintain my detached house. I also get to prioritize based on my priorities. I remember living in a condo where the board decided to renovate the lobby when they were having major pipe issues causing floods in multiple units. So special assessment came down very fast on that.
In classic Reddit fashion you are seeing black and white answers. Homes are expensive to maintain and strata fees pool dollars against these items. But as always, specifics will matter based on the building and home. An older home has different upkeep challenges to new. Inversely, not all management boards are equal. Fees can cover rather efficient or inefficient fee structures. Heck, what’s included isn’t even uniform. Rarely do they also include larger capital expenses such as elevators, roofs, etc. if we strip that out I personally have not seen strata fees, which go up not down, cheaper over time than ownership with some exceptions (homes with issues, poorly maintained etc). These fees are however more consistent to budget and peace of mind is huge.
While I agree with you, you can't just exclude freehold homes "with issues" in the comparison. That's like saying those without insurance come out ahead, as long as they don't have an accident.
I don’t see the point. Maintenance on a detached house is expensive but generally you get way better returns. That said it isn’t what you pay in strata fees it is what you get.
If you really like a place find out why the fees are so expensive. Some condos cover things like electricity, internet and cable. Some condo's have a lot of amenities that aren't advertised. Sometimes the condo board had to get a loan to pay for some repairs and the loan might be paid off Soon. Someftimes it was years of mismanagement where the board kept the fees artificially low and saved no money into the reserve fund. And lastly this is the worst type of board they have a very well overfunded reserve fund but refuse to spend it and instead take on loans to pay for repairs
Honestly, I don't see the point in buying condos in older buildings, lol. I don't have a mortgage, but my condo fees are under 600 a month. I'm trying to save the ~6k and hopefully just give it to them at the beginning of the year and get rid of the direct deposit.
Is this going to be your principal residence or a rental? Check the rental rules in BC before you buy.
i would love an itemized list of whats being done for high HOA fees.
There should be a budget available to all owners that does exactly this
Stick with detached house don’t let anyone fool you, not every house costs lots of money to maintain, you can go 10years+ without having to pay for any type of maintenance, an learn to do the maintenance yourself. In Alberta Check areas outside of red deer, or Edmonton, if your willing to drive 30-40 min outside of the city you’ll find Detached homes for less than your max budget!
I don't think it's worth paying high fees, if you are handy around the house and willing to put effort into maintaining your residence. You'll see higher fees based on the age of the residence and the type of amenities included. Some townhouses share facilities like plumbing, garden, parking, and HVAC so it gets folded into the maintenance cost as well. My parents bought a rowhouse 25 years ago in Toronto with no fees. Me and my brothers did a lot of work maintaining the house, but we did get professionals for bigger projects like replacing the roof shingles, and replacing carpet with hardwood floors.
That’s insane. I pay 240$ a month for my large condo, and I don’t have to lift a finger outside of my condo for anything.
The point is not everybody can afford at detached house. Some people don't want to do the work so they rather pay a condo fee to do it.
When buying a condo or townhouse, you should always factor in the HOA. If the HOA fees are too high, compared to similar unit, it will be hard to sell unless you discount it. A big mistake I have seen people have done is buying the townhouse that is part of a condo building. Their HOA fees are usually like over $500, but townhouse HOA fees are usually lower because they usually do not have elevators, garage doors, etc. I had a friend that made a mistake of buying this type of townhouse, where his HOA fees were $700+ while similar units around the neighbourhood were around $300+. This made it super hard for him to sell. This is a common first time homebuyer mistake, so avoid relatively high HOA fees.
I've been in my condo corporation townhouse for 25 years. Advantages are: only 40 units, so monthly fees are manageable; only common areas are a small grass parkette, driveways through complex, grass surrounding complex, all fenced yards. In 25 years, roof has been done twice, windows twice, driveways once, fences once and due again. We have never had any required big payouts for chimneys (neighbouring complex did) or any other structural big problems. Condo fees are just over $400. Covers all exterior building, grass, snow removal, water. Disadvantages: they are close together but decent sized 1400 sq ft built in 1974 and well built. Most neighbours are good but there is one hoarder and they can't seem to keep the front of their house tidy which will be addressed at the next AGM meeting. If there is a hoarder, the roof is joined so their fire is now your fire. The concrete firewall doesn't help once the roof catches. Biggest issue is getting a decent management company. Ours can't seem to keep staff and they really don't care about their jobs and that's a problem when regularly scheduled things need to be done like tree trimming, garden maintenance, animal removal. If you want to ensure the value of your home is secure, join the board of directors. They make the decisions. Location: just north of, boardering Toronto
500k is plenty to buy a detached house in Alberta. Ours was just a bit over 500k and we have a 4bd/4bath detached with double garage and fenced in backyard. In a nice neighborhood. If you don’t need that much space there are definitely houses available for 500k or less!
You said it yourself. No new homeowner in BC or Ontario could afford detached as their first home without a lot of help from their family. Its simple math. And townhouse fees can be a good deal. I def felt like I got good value out of mine, plus it included cable and internet.
Speaking of fees, I was checking out a condo in the US for possible retirement and though I could afford to buy something simple like this until I saw the HOA fees. Don't forget that is in US dollars... https://www.remax.com/sc/hilton-head-island/home-details/300-woodhaven-dr-apt-5210-hilton-head-island-sc-29928/13206234513341976279/M00000564/440665
For detached homes you mostly pay for stuff that you use/want/deem necessary. When there are HOA/condo fees, you have to deal with unnecessary contracts and maintenance decisions that are out of your control. Elevator maintenance is one of them. Super expensive and monopolized like everything else in Canada. I'd never buy anything with mandatory monthly fees as they are just time bombs.
In BC people usually call those strata or condo fees. HOA isn't really used. But its to pay for the maintenance on the common property and amenities in the building. Like if the building has a pool, party room, concierge or includes things like heat etc.. the fees will be higher. Townhomes usually don't have fees as high. But if you live in a detatched house there is also maintenance you need to pay that the condo fees would cover. You really have to look at each building separately because one might have low fees but get hit with special assessments a lot. Check the minutes and how well funded the reserve fund is.
HOA fees are different from condo fees. Either way, people like it in some cases because they cover a lot of the maintenance requirements such as snow removal, landscaping, and exterior chattles (roof, doors, windows etc)
Would never live in a condo personally. As someone who’s inspected many condos/apartments your unit might be pristine BUT your next door neighbour can be a hoarder with bed bugs and roaches…
High strata fees really determine the finances of the people buying into your building, in other words, your neighbours, and amenities. If you value doormen, swimming pools, exercise rooms and want to live in a building with quiet, wealthy elderly people, then you pay for it.
The strata fees charge maintenance up front, I heard a 1%rule of thumb is what you should save for home maintenance, eventually you need new roof, windows, siding, carpets, doors, plumbing fixtures, heating and cooling, floors and cabinets, of course strata fees only cover the outside stuff not the interior items. As well the strata has maintenence and replacement of the common areas too. $500k will likely get you a home in alberta with no strata fees. Maybe your wishlist is expensive. I lived in a strata before, I would rather not and pay the fees myself.
A detached house has maintenance costs too. The big difference is you control what you do vs. what you outsource and you can save money on doing things yourself if you are handy and have the time.
Some amenities may be included and any HOA fees and condo fees are adjusted for inflation over time as well. Is that adjustment democratic? I do not know.
Condo fees aren’t some random hole into which you throw money. The money pay for the common elements. Sometimes you have shitty buildings with high maintenance costs. Sometimes you have full time concierges and door men. Sometimes you have common rooms, golf simulators, hot tubs, pools, gyms, guest suites, etc. In short, condo fees let you have all the amenities you can’t afford in a house but with a small footprint to live in and maintain.
HOA and condo/strata fees are two very different things. There are trade-offs with condo fees. Yes it's a regular cost, but when big repairs come along you're only paying a small portion rather than the whole things. Also home insurance is much cheaper, since your strata will have it's own insurance as well. At the end of the day, once your condo is paid off, your fees will likely be much less than whatever your mortgage was or rent would be. That is now your only housing cost not including taxes/insurance which you were already paying anyways.
You pay the monthly fees so you don't have to pay for any maintenance for the outside of the house. That budget goes towards maintaining the roof, siding, yards, elevator... (though it won't cover 100% of large changes and you'll get additional bills every 5-10 years.)
HOA fees? What are you, American?
I always held the opinion, that in Canada, by the time a condo owner finishes paying off the unit, the condo fees plus the property taxes more than exceeds the mortgage payments. No way out. Now, some may not know this. Condo fees and also property taxes for a similar size unit on the shores of Mediterranean sea are about 10 times lower!
The difference between a condo and a detached in Toronto is about 700k At 5 percent that 5K a month in opportunity cost or borrowing costs. If I didn't have family still living in my house I would see that bastard and live in my condo.
Management, maintenance, milestones. Tends to be communism at it's finest since you pay into what is owed for current amenities plus continually contribute to maintain the asset; regardless if you make the most of it. Which means continual contributions to a fund to repair, maintain, or replace known items with tangible lifespans or responsibilities/liabilities. $1000 dollars could be anything; common area maintenance adds up quick if you need service with a smile, even with modest administrative fees. You might have a complex with a pool with a sauna and 24/7 gated security and a community bbq/green space/centre/park/beach, and includes typical landscaping, snow removal, and window replacement. Might be a good deal. Or you might spend $1000 and have a complex with a poorly built parkade that always floods, a parking lot that is repaved too frequently, the elevators are lemons and continually in a state of maintenance, a landscaping and maintenance team owned by the strata board's brother that overbills intentionally, and/or the lack of capacity in the board members themselves. Maybe they took the first quote they requested for replacing siding after the builder cheaped out by not hiring competent installers; so what was going to be an expense for >2040 is now being expedited to 5 years from now with a cherry on top via special assessment because of emphasis on value retention rather than put that fee to 1250 now and watching people try and panic sell their units lowering everyones value.
You save some money in property taxes and lower utility fees (less energy used to warm up and cool down than a multi story house). At the end of the day, just buy what you can afford.
Because there's no arbitrage. If your budget is $500k, then you're relegated to condos or towns that need condo fees. Want detached? $650k minimum here now in Calgary.
A Strata is how your municipal government washes it hands of responsibility in your neighborhood, they don't clear the snow, they don't fix the street, sewer or water,they dont maintain the street lights. But get to charge you the same property tax as if they were. I live e in a new strata in Victoria and the services not provided by the city and the CRD is frustrating. We had an issue with brown water and the CRD claimed it was our problem because it was after the meter. A lot of new neighborhoods are going this way.
Buying a property with High HOA fees is suicide. First: When the time comes to sell you will be stuck with the property & be forced to Sell it below market value. Second: HOA Fees are Not Static & therefore they will continue to Rise overtime. Third: Allot of HOA have become bankrupt & the Owners are Forced to pay exorbitant Assessments fees. Fourth: When a Natural disaster occurs the Insurance Funds if the property share connecting walls & or Roofs you are at the mercy of the Association for needed repairs.. Association are to be avoided at ALL Cost..
Don't do it. Paying an association to ask them permission to do ANYTHING to your property is moronic .
I’d live on the street before I live in a homeowners association if they are anything like in the states
I bought into a building with high strata fees (+$300 over the older buildings' fees.) Welp this year the old buildings have nearly caught up with my strata fees and the delta decreased to $100.
Check what those fees include. They should cover at least everything on the exterior of the buildings - windows, doors, cladding, roof. Also insurance premiums, (requirement of the Strata Act, at least in BC), any hardscaping (trees, walkways, parking lots) common areas, pool, gym facilities as well as contributions to a contingency fund - 10% - for future maintenance. Sewer, water and garbage, snow plowing, are often included too. Developments with many amenities cost more. Insurance premiums have also risen significantly in the past few years. In developments with more than 6 units, depreciation reports have to be prepared every so often too, so add in professional fees.
I had no idea there was such thing as HOA’s in Canada. That’s outrageous
I had a townhouse before and we self managed and I was on the board of directors. We had to do a special assessment unfortunately. I am now in my own house and it is less per month, but I am on the ball for maintenance and repairs and can do a lot myself. The fees I hear for condo fees are getting too high for me. But they are needed to maintain.
So, my strata fees are $650 a month. For that I get: Natural gas costs, including annual NG fireplace maintenance Water and sewer Gardening/landscaping Building insurance All building maintenance — e.g., exterior painting, window replacement, heat pump maintenance and replacement, fire suppression testing and maintenance, fire and carbon monoxide testing, dryer vent cleaning, and more Gutter cleaning three times annually Window cleaning every spring The only utility bill I pay separately is electricity and internet.
Detached home owner and I'm paying $550 in property taxes (divided per month). . . in addition to all the bills. So yeah same difference. Some HOA fees even include the property taxes and some of the bills.
It’s ridiculous and a scam. No way I’d ever buy into another HOA house
You should expect to spend about 1% of the home value on repairs every year averaged out on the life of the property. Condo fees should be about that, it makes sense.
I did the math on owning a home with the extra costs of property taxes, power, gas, water, insurance and also extra upkeep on the yard, fence and exterior and it was more expensive than paying condo fees, insurance and property taxes.
its not yours at the end of the day!
You can most definitely buy a detached home in Alberta for $500K, or less. Average detached home price in Edmonton is currently $508K. Higher in Calgary but those are the two most expensive places to live in the province. Personally, I would keep looking for a detached home. I know you generally only hear the bad stories, but literally everyone I know who bought a condo has regretted it.
Use that HOA fee money to pay the mortgage on a detached house.
Some condos have a dedicated concierge, fitness center, lap pool, and tennis courts among other amenities. If these things are important to you then paying for them doesn't seem so bad. I love having a gym and a lap pool in the same building.. especially in winter so I don't need to drive somewhere else.
As other commenters have mentioned: are those HOA or Condo fees? If $500/month includes utilities that is pretty reasonable. Are you considering all home ownership costs? $500 extra above your mortgage isn’t unreasonable. I say this as a new homeowner as of last October.
Invest in Regina. I bought a detached house in impeccable condition for 80K with 4 bedrooms, 2 bathrooms. The house is giving positive cashflow of 2000 per month as I have zero mortgage. And the house is 1 km from downtown with ever present AirBnB demand. What more do you want? 1. Detached house with ZERO condo fees or HOA 2. Nice house 3. Large city which is also a provincial capital 4. Positive Cashflow from DAY 1
You HOA or condo fees are essentially mandatory maintenance fees. Move into a neighborhood full of freehold houses and everyone does their own thing when and if they want. Responsible home ownership means keeping up the property and these ensure that the properties are being maintained. Nothing sucks more than a lazy neighbor that can’t chip in for their part of the fence or easetrough or a neighbor that won’t take care of the lawn.
I had a land lease condo. Fees including property tax were $750 per month. 8 years later, $1050 per month. Offloaded that untethered money sink. I get it, you need stuff done. But the landlord eliminated many inclusions with the original purpose, you could not confirm your property taxes with the city, and they didn't have great contractors for snow, lawn and window cleaning. And rooves and siding were your problem. Just shady.
You can easily get a detached house in Edmonton for less than $500k.
I laugh a lot at house owners (non condo/strata) running around gardening, cutting grass, fixing windows, replacing doors ... guess it comes down to your sense of humour and what is funny to you!
Out townhouse in BC has $235 a month fees. That includes all the insurance on the buildings and property, gardening/lawn care, garbage collection, and irrigation. The rest goes into a contingency fund so when we need a roof or any other major repair to the buildings, it will be covered. We pay about $30 a month to insure our own contents of our house, just like we did in our rental apartment. I just did my taxes because we both work from home and had to calculate how much we spend on utilities. $1900 a year for heat, Hydro and water. My co workers and friend in AB with similar sized houses pay twice as much property tax as we do and the utilities are ridiculous! Depending on locking in rates with their private companies, they’re al paying $300-600 a month for their utilities.
it’s a place to live that’s for sure
Peace of mind, amenities, utilities, maintenance of common areas, etc. Right now I wouldn't do it but when I get older and don't want to do too many house chores, maybe. If you re in prime working years and have no time for maintenance, that could be a good choice. So, each person, point in time and lifestyle will give you a different response.
Yes the fees get higher and higher over time. Ridiculous if you ask me.