Condos have condo fees for a reason. There is a lot of maintenance and upkeep that needs to be done for any building. Whether it is an apartment building or a townhouse style of home or regular single-family home. The difference with condos is that you are paying a management fee to someone to manage the building. You are paying labor costs for all of the work that needs to be completed. Much of which most people can do themselves e.g. cutting and trimming the lawn. Home maintenance costs are very small when you do the work yourself.
Management fees are a set fee that the management company will charge just to manage the property. Their job is to collect the money, hire contractors, and make sure that the work gets done. The work should be completed according to the instructions they receive from the condo board. When you are in your own home, no one needs to pay management fees. You are the owner and the manager and you get to do the work, providing huge savings.
Labor fees are another factor that comes into play when you have your own home vs. a condo. In a condo, you get to pay labor costs for everything at the going rate. While in a home there are many things that homeowners can do themselves. From raking leaves to planting flowers to fixing leaking faucets to name a few. This is a huge saving for anyone who can do the basic level of work. The larger jobs you can contract out or hire someone to help you.
Before this post begins to sound too much like a condo vs. single-family home post, we just want to say one thing more. A homeowner can shop around for materials. They can take advantage of sales for the material. While a contractor buys material and may get a discount for quantity. They may or may not pass the savings along to the condo!
Maintenance is regular things you have to do every year while repairs are something that needs to be fixed after it has broken or stopped working. Keeping your lawn healthy and trimmed looking is maintenance. Fixing broken fences or fences that have lasted beyond their age is something that needs repair. All of these things most people can do themselves as long as they are not afraid of a bit of hard work.
There are a number of large jobs that you will have to contend with particularly if you stay in a home for any length of time. We suggest that you set aside money for these things because they can cost a great deal and most people do not have that kind of money just sitting around. Here are a few examples of some of the things that people may want to consider saving for.
New roof – $4000 to $10,000 or more depending on the size of the home
Furnace Replacement – $3000 to $6000 again depending on the size of the furnace and features
New windows – $15,000 to $40,000 depending on how many windows and the type of windows
New driveway – $4,000 to $20,000 depending on size, asphalt or interlock
Upgrades – kitchen upgrades, bathroom upgrades, family room, basement etc can be high
Renovations – usually smaller jobs, but still expensive such as rug replacement, hardwood floors etc
A rule of thumb is to take the job you are going to do, figure out the cost of the job, decide when it will be done and divide by the number of years to get the amount you need to save each year. For example, if your roof is already 10 years old and has another 15 years of live, and th estimated cost to replace it is $5,000, then you need to save $5000 divided by 15 each year in order to have enough saved when the roof needs replacement. Apply this approach to all of your items and you should end up with enough money in your maintenance pool to pay for all of your repairs!