If you’ve been looking at condos in Calgary, you’ve probably noticed one thing pretty quickly: condo fees can vary A LOT.
You might see one condo with fees of $300/month and another similar-sized unit charging $700+.
So what’s the difference?
And more importantly, does a lower condo fee actually mean you’re getting a better deal?
Not necessarily.
Condo fees are an important part of the overall cost of owning a condo, and understanding what you’re actually paying for can save you from some potentially expensive surprises down the road.
Condo Fees at a Glance
Condo fees are a monthly cost paid by condo owners
They help cover maintenance and upkeep of the building and common areas
What’s included varies from building to building
Calgary condo fees can often range from around $0.50 to $1.00 per square foot
A portion typically goes toward the building’s reserve fund
Lower fees aren’t always better
Fees can increase over time as maintenance costs and inflation increase
What Are Condo Fees?
Condo fees, sometimes called condo maintenance fees, are monthly payments made by condo owners to the condominium corporation.
Think of them as your share of the costs associated with maintaining and operating the building and its common areas.
Depending on the building, your condo fees could help pay for things like landscaping, snow removal, building insurance, maintenance, utilities, elevators, amenities and future major repairs.
A portion of the fees also typically goes toward the reserve fund, which is essentially the building's savings account for larger expenses down the road.
And yes, condo fees are an additional expense on top of your mortgage, property taxes and personal condo insurance.
What Do Condo Fees Cover?
This is where things get interesting.
Not every condo building includes the same things in its monthly fees.
Depending on the building, condo fees may cover:
Water
Heat
Garbage collection
Landscaping
Snow removal
Building insurance
Common-area maintenance
Elevators
Gyms, pools or other amenities
Property management
Contributions to the reserve fund
For example, one building might include heat and water, while another has you paying those utilities separately.
So when you're comparing two condos, don't just compare the monthly fee. Look at what you're actually getting for that fee.
A $700/month condo fee that includes several utilities and extensive amenities could potentially be a better overall value than a $500/month fee where you have to pay for everything separately.
What Don't Condo Fees Cover?
There are also some expenses you'll still be responsible for.
Property Taxes: Your property taxes are separate from your condo fees and are paid to the municipality.
Your Personal Condo Insurance: The condominium corporation has insurance for the building and common areas, but that doesn't replace your own insurance. You'll still want coverage for your belongings, improvements to your unit and personal liability.
Parking & Storage: Some buildings charge separately for parking stalls or storage lockers, especially if they're not included with the unit.
Special Assessments: This is the one that can really hurt. If the reserve fund doesn't have enough money to cover a major repair, the condo corporation may issue a special levy, also called a special assessment.
That means an additional bill for the owners.
And depending on the project, that bill can be hundreds, thousands or even tens of thousands of dollars.
How Are Condo Fees Calculated?
There isn't one universal formula for condo fees.
Several factors can affect what you pay, including:
The size of your unit
The age of the building
The type of building
The amenities
Shared utility costs
Common-area maintenance
The condominium corporation's budget
Contributions to the reserve fund
Inflation and rising maintenance costs
Generally speaking, larger units will have higher fees because they're responsible for a larger share of the building's expenses.
Buildings with pools, gyms, underground parking, elevators and extensive landscaping will also generally cost more to operate than a smaller, simpler building.
How Much Are Condo Fees in Calgary?
A general range you'll often see in Calgary is around $0.50 to $1.00 per square foot per month, although there are plenty of exceptions.
For example, a 1,000-square-foot condo at $0.60/sq. ft. would have condo fees of roughly $600/month.
A similar-sized unit in a building with more amenities, higher operating costs or a greater reserve fund contribution could be considerably more.
The important thing is not to automatically assume that a higher condo fee is bad.
Sometimes you're paying more because the building is properly funding its future expenses.
And that's actually something you want to pay attention to.
The Reserve Fund: Probably the Most Important Part
If you're buying a condo, I would pay very close attention to the reserve fund.
Think of it as the building's long-term savings account.
A portion of your monthly condo fee goes toward this fund, which is intended to pay for major repairs and replacements in the future.
Things like:
Roof replacement
Exterior repairs
Windows
Elevators
Building systems
Structural repairs
Other major capital projects
Older buildings can be particularly important to investigate because more of their major components may be approaching the end of their useful life.
And in Calgary, our freeze-thaw cycles, temperature swings and weather can add additional wear and tear to buildings over time.
What Happens When the Reserve Fund Isn't Enough?
Let's say the building needs a $500,000 repair, but there isn't enough money in the reserve fund.
The condominium corporation still has to pay for the repair.
That's where a special levy can come in.
The owners may be required to contribute additional money to cover the shortfall.
This is one of the biggest reasons I always tell condo buyers:
Don't just look at the condo fee. Look at the financial health of the building.
A building with a $400/month condo fee isn't necessarily a better deal than one charging $600/month.
The $400 building might simply not be putting enough money aside for future repairs.
What Is a Reserve Fund Study?
A reserve fund study is essentially a professional assessment of the building's major components and future repair needs.
It looks at things like:
What needs to be replaced
When those replacements are expected
How much they could cost
Whether the current reserve fund is sufficient
This can give you a much better picture of the building's financial position and potential future costs.
This is something I strongly recommend reviewing before buying a condo.
Red Flags to Watch For
When reviewing a condo, here are a few things that would make me dig deeper:
Condo fees that seem unusually low compared with similar buildings
An outdated reserve fund study
A reserve fund that's consistently shrinking
Significant deferred maintenance
Multiple special assessments in recent years
Large upcoming repairs without enough money set aside
None of these automatically mean you should walk away.
But they are definitely reasons to ask more questions.
How Should You Evaluate Condo Fees Before Buying?
Here's how I would approach it.
Review the Financial Statements: Look at the condo corporation's financial statements and see whether the building is running consistent surpluses or deficits. You also want to see whether the reserve fund is growing or shrinking.
Review the Reserve Fund Study: Find out what major repairs are coming and whether the building has enough money set aside to deal with them.
Look at the History of Condo Fee Increases: Don't just look at today's condo fee, ask how much the fees have increased over the past several years. If fees have been climbing significantly every year, it's worth understanding why.
Compare Similar Buildings: Look at other buildings in the same area. If one building is charging significantly less than comparable properties, ask yourself why. Maybe it's a newer building with fewer expenses or maybe the building isn't putting enough money into its reserve fund.
Find Out What's Included: Ask exactly what your condo fee covers, does it cover utilities, maintenance, etc… This can make a big difference when comparing your total monthly housing costs.
Ask About Special Assessments: One of the questions I would want answered before buying is: "Are there any current or upcoming special assessments?" You don't want to find out about a major upcoming bill after you've already bought the condo.
Frequently Asked Questions
Do Condo Fees Include Utilities? Sometimes, which utilities are included varies from building to building, so always check the condo documents and confirm exactly what's covered.
Can Condo Fees Increase? Absolutely, condo fees can increase as operating costs, maintenance expenses, insurance and reserve fund requirements change. That's why it's important to look at the history of fee increases rather than assuming today's number will stay the same forever.
Are Condo Fees Tax Deductible? It depends on how you use the property, if you're using the condo as a rental property, condo fees may be deductible as a rental expense. If you're using part of the property for business purposes, there may also be deductions available. If you're unsure, it's best to speak with a qualified tax professional.
Do Condo Fees Include Property Taxes? No, property taxes are separate and are paid to the municipality.
What Happens If I Don't Pay My Condo Fees? Not paying your condo fees can result in penalties, interest and potentially legal action. Condo fees are an obligation of ownership, so they're something you need to budget for just like your mortgage and property taxes.
How Are Special Levies Handled? A special levy is an additional charge to condo owners when the condominium corporation needs money for an expense that can't be covered by the existing budget or reserve fund. The amount and payment structure will depend on the situation and the condominium corporation.
The Bottom Line
When you're buying a condo in Calgary, don't let the condo fee number be the only thing you look at.
A low condo fee might sound great, but if the building isn't properly funded, you could end up paying much more later through fee increases or special assessments.
Instead, look at the whole picture:
What does the fee include?
How healthy is the reserve fund?
What major repairs are coming?
How have fees changed over time?
Are there any upcoming special assessments?
A condo with a slightly higher monthly fee can sometimes be the smarter purchase if the building is well maintained, properly managed and financially healthy.
Buying a condo isn't just about buying the unit. You're also buying into the building and its financial future.
If you're considering buying a condo in Calgary and want help understanding the condo documents, fees or overall numbers, I'd be happy to help you make sense of it before you write an offer.