Answer for "What is a maintenance fee?"
So, you’re thinking of moving for the first time to a condominium or an apartment. Well, there are some expenses that you might not have dealt with before. Cost of living and utility bills aside, you will meet face-to-face with the maintenance fee. We know that this is new to you, but we’ll clear the air. Your first question is naturally …
What is a maintenance fee?
Maintenance Fee is an annual or monthly charge that associations, companies, or financial institutions require in exchange for services. These periodic expenditures are undertaken to preserve or retain a property's operational status for its originally intended use. These expenditures improve or extend the life of the property. It is an expense, which is distinguished from capital improvements that are capitalized and can be added to the monthly maintenance fee. Examples are the cost of fixing a sprinkler system or painting a wall.
In real estate maintenance fee is a charge by condominium associations, co-ops, or other homeowners associations for the upkeep of the property. The maintenance fee is also known as the homeowner's fee, and its value can vary on where you live, what the amenities are, and the size of the apartment. The cost of your monthly maintenance fee can start at $50, which is barely worth mentioning, but it can go over$1,000.
What does the maintenance fee cover?
After you decide to purchase a condo, one of the things you should pay attention to is the cost of the monthly maintenance fee and what it covers. The services and amenities are essential in any condominium or apartment complex. Still, it is also essential to know your lifestyle and whether or not you will be using those amenities that you’ll be paying for. The following are some of the amenities and services that are covered by the maintenance fee:
- Patios and sidewalks maintenance;
- Snow removal;
- Landscaping;
- Buildings’ physical exterior;
- Tennis courts;
- Swimming pool;
- Elevator;
- Sewage lines;
- Trash collection.
Besides the monthly fee that is set and fixed, there can also be assessments that happen quarterly or annually. These assessments can provide additional fees for unforeseen expenses. Any other services or amenities added can affect the monthly maintenance fee, which can be modified, but the co-ops or condominium associations need to notify you of these changes.
There are condominium associations that do not require you to pay for the amenities you do not use. For example, if the condominium has an on-site gym, but you don’t need or want to use it, then your fee might be lower than what is standard in the condominium. Make sure to check this information before you sign the deed to your new condo.
What doesn’t the fee cover?
When it comes to the disadvantages of living in a condominium, even if you pay your monthly maintenance fee, there may be instances when something breaks inside your unit. If the tile floor breaks or the wooden floor gets scraped, those repairs come directly out of the owner’s pocket. For a renter, however, the cost of repairs is only required if they are responsible for the damage.
The plus side to paying maintenance fees is that you will not have to worry about shoveling snow or maintaining your landscaping. For the inside of the condo, however, there are a few maintenance tips that you could use. Living in a condo with a maintenance fee, you will get to live a maintenance-free lifestyle, at least when it comes to the outer facilities, amenities, and services.
Have a question or comment? We're here to help.