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Condo fees vs House Expenses - Putting Condo Fees into Perspective


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Since houses don't have fees, they're always a better deal, right? Not so fast. Lets take a look at what condo fees pay for, and what their equivalent house expense might look like.

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Condo fees vs House Expenses - Putting Condo Fees into Perspective

  1. 1. Winnipegs Real Estate Info Info and Tips for Buyers and Sellers of Winnipeg Real Estate - Condo Fees vs. House Expenses by Bo Kauffmann - expenses/ Prospective home owners sometimes use the subject of condo fees to justify their preference of a house over a condo. The argument is: "If I buy a house, I can save the condo fees." This reasoning is not entirely accurate, since it assumes that house-ownership is completely without cost. Water, Home Insurance, and Heating Costs Water: Virtually all condo fees already include water and hot water. Home insurance: Property is also going to be substantially more in a house, since the condo building is already insured, and the condo-buyer only has to purchase condo insurance. Heating costs for an apartment or townhouse style unit are also going to be substantially less than the heating costs for a stand-alone house in the $200K range. (I point out the price range, since MOST 200K houses will likely have either old furnaces, old windows, poor insulation, etc.) Emergency Fund Home owners (especially buyers of older buildings) are well advised to start an emergency fund for things that go wrong. For example, a new roof ($5000), new furnace ($4000), hot-water tank ($800), windows and doors ($15,000) can put a real dent into your savings. So putting aside a small amount each month, the house-owner could save enough money to pay for those things. All the while, the condo-fees already include this savings fund: its called the Condo Reserve Fund. So lets take a look at the various savings in the chart below. 1 / 3
  2. 2. Winnipegs Real Estate Info Info and Tips for Buyers and Sellers of Winnipeg Real Estate - In the first column, we have the costs of house-ownership. The middle column shows that some of those items are already included, while the rest are substantially lower. The column on the right hand side shows the actual savings enjoyed by the Condo-Owner. $215 per month LESS for the Condo So in this example, the operating costs of a condo are actually about $215 per month LESS than the house, if you include the 'emergency fund' savings plan for the house. So now, take the $215 off the condo fee of $275, and the actual additional costs (over and above a house-ownership) are only $60 per month. For that money, the condo owner gets professional management, landscaping and snow-clearing, and often the use of amenities such as workout room, swimming pool, etc. It's about life-style Condo ownership is about the life-style. If you travel a lot, or are too busy for yard work, or any number of other reasons, then condo-ownership may be for you. It should be pointed out that, even in a condo, it's prudent to have some extra money set aside, in case the Reserve Fund is not large enough to tackle any major project or renovation. When that happens, the condo owner will face a 'Special Assessment', a sudden bill he will have to pay. But there again, thats really not much different from having to buy a new furnace or other major unexpected repair. Condo Fees vs. Housing Expenses 2 / 3
  3. 3. Winnipegs Real Estate Info Info and Tips for Buyers and Sellers of Winnipeg Real Estate - Audio Version of this post For the text of this audio, click this down arrow Also check out "Closing Costs When Buying A House Or Condo" What is Winnipeg's market, as far as Condo Sales and Listings are concerned? Check out monthly condo market update. Buying A Condo, Buying A Condo Steps, Buying A Condo Worth It Buying A Condo Or House. Of Buying A Condo. Buying A Condo Vs House. Process Of Buying A Condo. Tips On Buying A Condo. Buying A Condo Vs Renting. Bo Kauffmann is a top-producing REALTOR� with REMAX performance realty, and he enjoys working with both home buyers and sellers. He is an avid student of social media and internet marketing, with strong followings on facebook, twitter, linkedin and google+. If you're looking to buy or sell, a house or a condo in Winnipeg, book a free, no obligation consultation with Bo. Powered by TCPDF ( 3 / 3