What are Condo Fees, How are They Calculated, and What Do They Cover?

Condo Fees: What They Are, How They're Calculated, and What They Cover

What Are Condo Fees?

Condo fees—also known as condominium fees, HOA (Homeowners Association) fees, or strata fees (in some regions)—are monthly payments made by condominium unit owners. These fees go toward the operation, maintenance, and repair of the common areas and shared services in the condominium building or complex.

How Are Condo Fees Calculated?

Condo fees are usually calculated based on the size or value of your individual unit in relation to the total building or community. The process typically includes:

  1. Operating Budget Creation:

    • The condo board or property management company creates an annual budget estimating all shared costs (utilities, maintenance, etc.).

  2. Proportional Share Allocation:

    • Each unit is assigned a percentage interest in the building (often based on square footage or legal title).

    • Your condo fee = (Total Annual Budget × Your % Share) ÷ 12 months

🔎 Example:
If the total annual budget is $600,000 and your unit’s share is 1%, your annual fee is $6,000, or $500/month.

What Do Condo Fees Typically Cover?

Condo fees vary depending on the building, location, and amenities, but commonly cover:

1. Building Operations & Maintenance

  • Common area cleaning (hallways, lobbies)

  • Landscaping and snow removal

  • Garbage collection

  • Pest control

2. Utilities (for Common Areas or Sometimes Individual Units)

  • Electricity, water, heating/cooling for hallways or shared spaces

  • In some buildings: unit water/gas or cable

3. Repairs & Replacements

  • Elevator servicing

  • Roof, HVAC systems, plumbing repairs

  • Painting and flooring in hallways

4. Amenities

  • Pools, gyms, party rooms, lounges

  • Security staff or systems

5. Reserve Fund Contributions

  • A portion goes into a reserve fund (also called a sinking fund) for major future expenses like roof replacements, parking lot repaving, or structural repairs.

6. Insurance

  • Building insurance (covers structure and common elements; not your personal belongings)

What’s Not Typically Covered?

  • Property taxes

  • Homeowners insurance for your unit's interior and contents

  • Internet or cable (unless bundled)

  • Maintenance/repairs inside your individual unit

Key Takeaways:

  • Condo fees are mandatory and help maintain your shared property.

  • They are proportional to your unit’s size or value.

  • Always ask for a breakdown of what fees cover and check the financial health of the building's reserve fund before buying a condo.

Would you like help estimating condo fees for a specific property or understanding what’s reasonable in your area?