What Do Condo Fees Cover in Ontario? A Plain-Language Guide

When you compare condo units, the monthly fee can feel like one big number with no explanation. Two buildings may charge very different amounts, and it is not always clear what you are getting for the money.

This guide explains what Ontario condo fees (called common expenses) usually include, what they leave out, and how the status certificate helps you check before you buy.

What condo fees actually are

In Ontario, the monthly condo fee is your share of the corporation's common expenses. These fees pay for maintaining the common elements, reserve fund contributions, and services such as cleaning, building maintenance and condo management.

Your share is a percentage set in the declaration, and it may vary with the size of your unit. For example, a unit with a 5% share of a $1,000 monthly budget pays $50 a month.

What is usually inside the fee

• Maintenance of the common elements, such as hallways, lobbies and shared grounds.
• Contributions to the reserve fund.
• Services such as cleaning and building maintenance.
• Condo management.

Utilities and the corporation's insurance premiums are often part of the budget too, but this differs between buildings. For example, if units are separately metered you may pay some utilities yourself. Check the budget and the declaration for the building you are considering.

What the fee does not cover

Special assessments and chargebacks are ownership costs separate from your regular monthly fees. A chargeback is a cost the corporation bills to one owner, usually because of that owner's act or omission.

The fee also does not give you insurance for your own belongings or upgrades. The corporation's property insurance does not cover improvements or non-standard elements of units, and fixtures, furnishings, equipment and personal property are generally not part of a standard unit, which each corporation defines in its governing documents.

If you are buying a new unit from a builder, you pay an interim occupancy fee during interim occupancy whether or not you move in. It cannot exceed the total of monthly interest on the unpaid balance at the prescribed rate, estimated monthly municipal taxes, and projected common expenses for the unit.

Why the reserve fund matters to your fee

The reserve fund may be used only for major repair and replacement of the common elements and assets of the corporation. Owners pay into it through their monthly fees, and the board decides how much goes in and may need to raise contributions to keep the fund adequate.

A fee that looks low may simply mean less is being set aside for big repairs. That can lead to higher fees or a special assessment later. A board can levy a special assessment through common expense fees without owner approval, for reasons such as unforeseen expenses or a major repair that exceeds its budget.

A new condo corporation must complete a Class 1 reserve fund study within the first year after the declaration and description are registered. After that, updated studies are required at least every three years, alternating between Class 2 (with a site inspection) and Class 3 (a review of records and interviews, with no site inspection). The study looks at components expected to need major repair or replacement within at least 30 years, and its funding plan is projected over at least 30 consecutive years.

Once the board receives a study, it must review it within 120 days and propose a plan for future funding. Within 15 days of proposing the plan, the board must send owners a Notice of Future Funding of Reserve Fund. Reading the latest study and plan gives you a sense of whether the current fee is realistic.

What happens when fees go unpaid

When an owner defaults on common expenses, the corporation automatically has a lien against the unit. The lien covers the unpaid amount, interest, and all reasonable legal costs and collection expenses. The lien expires three months after the default unless the corporation registers a Certificate of Lien in the Land Registry Office.

An owner can pay everything secured by the lien at any point until the unit is sold, and the corporation must then discharge the lien. This is one more reason the arrears statement in the status certificate matters when you are buying.

How to check the status certificate and what to do next

A status certificate must be provided within 10 days. It may include a statement on the most recent reserve fund study and the state of the fund, any arrears on the unit, special assessments levied since the current budget and why, and certificates of insurance. Whatever it includes or leaves out binds the corporation.

• Ask for the status certificate for the exact unit you are buying.
• Read the reserve fund statement and note when the last study was done.
• Look for special assessments levied since the current budget and the reasons given.
• Check for arrears on the unit.
• Read the insurance certificates and the declaration's definition of a standard unit.
• Work out what you will need to insure yourself.
• Have a lawyer review the certificate and governing documents before you remove conditions.

Frequently asked questions