Condo Fees vs. Home Ownership

[rbt]

It may be overstated, but it's not complete BS. For example in my townhouse condo + condo apt. complex, the decision was made to redo the condo lobby, purely for aesthetic reasons. There was no significant maintenance issue. Most of us in the townhouses and some in the condo building felt it was a complete waste of money, but the majority in the condo building wanted the lobby reno, and the condo building dwellers outnumbered the townhouse dwellers.

Granted, ours wasn't a $500000 job. It was five digits, since it was purely aesthetic and was a small lobby, but nonetheless the idea is similar.

Hrm.. I thought anything which was not normal spending and more than a minimal portion of the budget (1% or 2%) required a vote by the owners to approve it.

 

[Eug]

Hrm.. I thought anything which was not normal spending and more than a minimal portion of the budget (1% or 2%) required a vote by the owners to approve it.

I don't know what proportion of the budget it was, but this purely cosmetic spending was brought to vote, and it was supported in the vote.

So yeah, democratic process and all that, but my point is that a large group of us did oppose it. The majority of the condo townhouse owners opposed it, for obvious reasons, but the majority of the condo apt. owners supported it, and since the condo apt. owners outnumbered the condo townhouse owners, it went through.

It should be noted that we townhouse owners were not opposed to an aesthetic refresh of the condo building lobby, but we wanted less money spent on it. But that was never an option brought to vote. It was framed by the condo board as $xyz money to be spent, and you could support it or not support it.

BTW, on another note - on the flip side, I was on the gym committee. Our condo building was built with space for a gym, but it was up to us to fill the space. So, over time we added equipment to that gym using money from our condo fees. However, those of us on the committee framed the options to try to ensure what WE wanted would get put into the gym. Yes, this was voted on too, but we made sure our preferences were met first and let the voters support us for those preferences. That way I got my rowing machine and my preferred model no less sooner rather than later.

 

[TheKingEast]

I call BS.

That's an out of control board, one which was VOTED in by residents. If they object to board decisions, according to the act, a certain percentage of them can sign up and demand a meeting to vote them out. The thing about condos is, too many residents buy in thinking "Lalalalala condo lifestyle I don't need to think. I'm worry and fancy free." So they don't go to AGMs, they don't get involved, they don't examine the minutes if they smell a rat ... You do nothing, you get nothing.

A $500K lobby reno doesn't just happen. There's a reserve fund study which residents should look at it when it's published. The annual budget will say "We're planning to spend $500K for new rugs." or whatever.

If you're in a SFD, you may make your own decisions, but you live with the consequences. If the mailman breaks his neck because your front steps collapse, you pay the piper. A board of directors' mission is to never get to that point.

A board must do due diligence. Three bids, just like we used to do at the house. Sometimes the lowest bids are suspicious, and end up being more expensive. Sometimes, as we just did, we can take the highest and highest-quality bidder and negotiate them down to where the middle bidder was.

Do you just make this stuff up?

ETA: CondoMadness (whom I adore) posted this in another thread. It's worth posting here.
http://www.condomadness.info/challenge_board.html

Just checked. $400K and that doesn't include furniture. Point is, while people can vote on things, if you live in a young building who values the pool more than the windows then guess what? The pool will get reno'd before the windows.

I don't know much about the reserve fund in that particular building but they had a bunch of money and now the fees are going up!

 

[rbt]

I don't know what proportion of the budget it was, but this purely cosmetic spending was brought to vote, and it was supported in the vote.

So yeah, democratic process and all that, but my point is that a large group of us did oppose it. The majority of the condo townhouse owners opposed it, for obvious reasons, but the majority of the condo apt. owners supported it, and since the condo apt. owners outnumbered the condo townhouse owners, it went through.

It should be noted that we townhouse owners were not opposed to an aesthetic refresh of the condo building lobby, but we wanted less money spent on it. But that was never an option brought to vote. It was framed by the condo board as $xyz money to be spent, and you could support it or not support it.

I understand now. Yes, combined condo corps do present some challenges.

I prefer the ones which are separate for each built form (townhouse corp and apartment corp) with an agreement for handling shared common area expenses; though this adds challenges for renovations of the shared common areas as they need to be ratified by both sets of corp owners

 

[Condo Madness]

I can hear jackhammers below me as I type this post. A big job that need not have been so big had the past board done the right thing when it needed to be done.

What's interesting though is how, now, most of the people coming in are downsizers from older neighbourhoods around us. These people accept that you have to keep doing maintenance, that foundations leak, roofs need replacing, furnaces die. So, while none of us are happy about our maintenance fees increasing, we accept this as a part of living in an older, solid, stolid building with large apartments. Our fees cover heat, hydro, water tax, premium cable with two free digital boxes, and more. I figure we are still way ahead in terms of monthly expenses from having a semi in Riverdale.

If you have jackhammers pounding away I would guess that you are having work done on the balconies. That is a noisy, dirty and expensive job.

I advise owners to keep on top of the type of owners who move into a building. If they are young and put everything they have into the down payment, or if they are landlords (inverstors) who will be renting the place out, then they will want low fees. These people can be dangerous as they will vote for anyone who promises to freeze or lower the fees.

People who owned houses and have put away some money in the bank make for wiser owners. They bought with the intention of staying and they understand the importance of regular maintenance.

 

[doug]

I advise owners to keep on top of the type of owners who move into a building.

How?

 

[Condo Madness]

How?

A few ideas.
1. Go to the AGMs and listen to the owners. If they push for low fees or if candidates get elected on a "No Fee Increase" platform, get worried.

2. Some managers/directors will talk about these things in a general way, no specifics.

3. If you have good relations with the security guards, you will know if more renters are moving in and if there is an increase in incidents. Ask the manager how many units are rented. That is not confidential information.

4. Every once in a while, hang around the amenities, mail room, lobby or in the parking level lobbies during the evening rush hour. You will see if there is a change in the type of people that live in the building. (Don't be creepy or obvious doing this.)

5. Walk through the hallways in the early evening. Do you smell a lot of marijuana?

6. Use the staircases every once in a while. Are there kids hanging around in them? Cigarette butts, roaches on the stairs? Do you smell urine?

7. If you have zero fee increases with no reasonable explanation, get worried. If you have no fee increases for two or more years in a row, get ready to sell.

8. If a new board gets elected and cuts the monthly fees, sell.

9. Look at the Accounts Receivables in the financial statements. If they are going up it means more people are in arrears. I have seen this number as high as $250,000.

10. Any bad debts that are written off is a bad sign.

11. Windows not getting cleaned, the garage is not swept, the management and cleaning companies are constantly being changed is a bad sign.

12. Listen to your neighbours.

 

[doug]

None of your points will prevent any 'type' of people from moving into a building , there's nothing you, as a condo owner, can do do prevent a certain 'type' of person from moving in.

5. Walk through the hallways in the early evening. Do you smell a lot of marijuana?

This one is particularly laughable and speaks volumes about the 'type' of person you are.

 

[Wooba]

None of your points will prevent any 'type' of people from moving into a building , there's nothing you, as a condo owner, can do do prevent a certain 'type' of person from moving in.

He doesn't say anything about stopping people moving in. He's talking about watching the demographics of the residents that are moving in to try and foresee the direction of the condo management will take.

 

[doug]

He doesn't say anything about stopping people moving in. He's talking about watching the demographics of the residents that are moving in to try and foresee the direction of the condo management will take.

In other words, use common sense. When you see crack dealers moving into the neighbourhood, maybe it's time to think about moving.

Does this really need to be stated?

 

[Condo Madness]

None of your points will prevent any 'type' of people from moving into a building , there's nothing you, as a condo owner, can do do prevent a certain 'type' of person from moving in.

5. Walk through the hallways in the early evening. Do you smell a lot of marijuana?
This one is particularly laughable and speaks volumes about the 'type' of person you are.

I lived in a condo where more than half of the original owners spotted many of the points I made and sold and got out within the first four years.

What did they miss out on? A $9,000 special assessment, CMHC refusing to insure mortgages, $800,000 shortage in the Reserve Funds, a half-dozen power of sales and a run-down building.

Anything else? Oh, yes, the early signs were the stink of marijuana in the hallways, drug dealing in the driveway, drunks in the lobby residents in the outside visitor parking openly using a water pipe and a resident wandering around the property at night hunting for cigarette butts.

At the first signs of this behaviour, and there is no sign that the board is getting on top of it, get out.

 

[TheKingEast]

I lived in a condo where more than half of the original owners spotted many of the points I made and sold and got out within the first four years.

What did they miss out on? A $9,000 special assessment, CMHC refusing to insure mortgages, $800,000 shortage in the Reserve Funds, a half-dozen power of sales and a run-down building.

Anything else? Oh, yes, the early signs were the stink of marijuana in the hallways, drug dealing in the driveway, drunks in the lobby residents in the outside visitor parking openly using a water pipe and a resident wandering around the property at night hunting for cigarette butts.

At the first signs of this behaviour, and there is no sign that the board is getting on top of it, get out.

There are a few condos that have this problem. Good advice.

 

[Wooba]

Does this really need to be stated?

Apparently, since you asked him to.

 

[W. K. Lis]

I lived in a condo where more than half of the original owners spotted many of the points I made and sold and got out within the first four years.

What did they miss out on? A $9,000 special assessment, CMHC refusing to insure mortgages, $800,000 shortage in the Reserve Funds, a half-dozen power of sales and a run-down building.

Anything else? Oh, yes, the early signs were the stink of marijuana in the hallways, drug dealing in the driveway, drunks in the lobby residents in the outside visitor parking openly using a water pipe and a resident wandering around the property at night hunting for cigarette butts.

At the first signs of this behaviour, and there is no sign that the board is getting on top of it, get out.

I sure wouldn't want to even look at or visit a condo at 320 Dixon Road. See link. Yet there are those who do.

 

[Condo Madness]

I sure wouldn't want to even look at or visit a condo at 320 Dixon Road. See link. Yet there are those who do.

I have written a whole chapter on YCC #42 which consists of 320, 330 & 340 Dixon Road. It started off as a very nice condo community and then it ran off the rails. What surprised me is the role the City of Etobicoke played in triggering the decline.

Then a series of boards that could not, or would not, enforce the Act, Declaration, bylaws and rules combined with corruption took over from there.

When the court-appointed administrator left, the new president barred the police from entering the property unless they were answering a 911 call. That ruling lasted for a few months. Lessons to be learnt from this condo.
http://www.condomadness.info/contents-YCC42.html