Condo Fees in Ontario: What They Cover & How to Budget

Condo owners generally contribute toward the shared expenses of their condominium corporation through common expenses, often referred to as condo fees or maintenance fees.

The condominium corporation uses these contributions to pay eligible operating expenses and fund obligations associated with the condominium property.

The amount paid by an individual owner depends on the condominium's governing documents and the owner's allocated share of the common expenses.

Official source: Condominium Authority of Ontario — Condo Fees ↗

The exact expenses included vary from one condominium to another. Depending on the property, common expenses may help pay for items such as:

Some condominiums may also include certain unit utilities in the monthly fee, while others meter those services separately.

This means a $600 monthly fee in one building is not necessarily equivalent to a $600 fee in another building.

Condo ownership still involves expenses outside the monthly common-expense payment.

Depending on the building and unit, owners may separately pay for electricity, internet, unit insurance, property taxes, parking, locker expenses and maintenance or repairs inside their unit.

Before comparing two properties, determine which expenses are actually included in each building's fees.

There is no universal Ontario condo fee because buildings have different operating costs and responsibilities.

Ontario condominium corporations are generally required to maintain a reserve fund used for major repairs and replacement of the common elements and assets of the corporation.

Examples can include major components such as roofs, elevators, garages, mechanical systems or other common elements, depending on the condominium.

Condominium corporations are also generally required to obtain reserve fund studies periodically. These studies help assess expected major repairs and replacements and the funding required for them.

Official source: Condominium Authority of Ontario — Reserve Funds ↗

A low monthly fee can make a listing attractive, but the number should be considered in context.

Lower fees may simply reflect a building with fewer amenities or fewer expenses included. But buyers should also understand the corporation's finances, reserve funding and anticipated major expenditures.

Similarly, a higher fee is not automatically evidence of a poorly managed condominium. It may include utilities, services or amenities that would otherwise be paid separately.

In some circumstances, a condominium corporation may require owners to contribute additional money beyond their regular monthly common expenses.

These additional amounts are commonly called special assessments. They can arise when the corporation needs funds that are not sufficiently covered by its existing budget or reserve fund.

The amount can vary significantly depending on the condominium, the work required and the owner's share of common expenses.

A potential buyer should therefore look beyond the current monthly fee when evaluating the financial condition of a condo.

A status certificate provides important information about a condominium corporation and a particular unit.

It can contain information and documents relating to common expenses, the corporation's finances, insurance, governing documents and other matters relevant to a purchaser.

Buyers commonly have a real-estate lawyer review the status certificate and accompanying documents as part of the purchase process.

Official source: Condominium Authority of Ontario — Status Certificates ↗

Condo fees are not only a budgeting consideration. They can also affect how much mortgage financing a buyer qualifies for.

For CMHC debt-service calculations, 50% of applicable condo fees are included when calculating Gross Debt Service and Total Debt Service ratios.

That means a property with substantially higher condo fees may affect mortgage qualification even when its purchase price is identical to another property.

Consider two hypothetical condos.

Condo B is $25,000 cheaper to purchase, but its condo fee is $250 per month higher — a difference of $3,000 per year before considering what each fee includes.

Over five years, that difference represents $15,000 in nominal condo-fee payments if the fees remained unchanged. In reality, fees can change over time, so the comparison should also account for potential increases.

The mortgage difference, property taxes, utilities, insurance and other expenses should then be considered alongside the condo fees.

Condo fees are not guaranteed to remain fixed. A condominium corporation's budget can change as operating expenses, insurance, contracts, maintenance requirements and reserve-fund contributions change.

When evaluating affordability, it is useful to consider not only today's fee but also whether your budget could absorb higher common expenses in the future.

Condo Cost Ontario's five-year outlook allows you to model an annual condo-fee increase rather than assuming the fee never changes.

Every condominium corporation is different. Common expenses, reserve funds, special assessments, included services and other financial matters depend on the specific property.

This guide and Condo Cost Ontario are provided for general informational and planning purposes only and are not legal, financial, mortgage, investment or real-estate advice.

Buyers should review the relevant condominium documents and obtain appropriate professional advice before completing a purchase.