In preparing data for a investing in real estate book by Brian Persaud of Real Experts (http://www.realexpertsinc.com/) we took a look at condo maintenance fees. We were also inspired to write this post based on an interesting article in the Globe this weekend on condo fees.
Urbanation looked at a sample of 90 new condominium apartment projects that were active in Q1-2006. These condo projects had an average (forecasted or projected) monthly maintenance fee of $0.40 psf, ranging from a low of $0.27 psf at St. Gabriel Village - Phase I (marketed as a green condo with Wind Turbines) to $0.67 at 100 Yorkville - East Building (a luxury project).
The average resale maintenance fee over the past year (Q2-2010 to Q1-2011) at these projects was $0.52 psf, or a 30% increase compared to 2006 (~6% annual increase). This is something all condo purchasers should keep in mind when budgeting.
The largest increases were found at St. Gabriel Village - Phase I at 91% (up to $0.52 psf - perhaps the green features were not saving as much as anticipated?), Radio City I at 86% ($0.35 to $0.65 psf), and The Fountains of Edenbridge at 81% ($0.36 to $0.65 psf).
Monarch Group's EQ1 and EQ2 in Scarborough have seen maintenance fees increase by just 6% and 4% respectively. Monarch has the reputation of including realistic occupancy dates and maintenance fees in their new project brochures and sales packages.
This type of data analysis will be part of Urbanation newest report "UrbanRental" and should be followed by any serious investor, go to www.urbanation.ca/UrbanRental for more details.