Are apartment management fees a waste of money

windmilllane

We are currently looking at buying an investment property in a busy tourist spot. Ideally we want a small townhouse but they are scarse. The other option is an apartment. With that comes management fees. I know bins and insurance can be included. Do you feel you get your money worth?

Homer

They can also be offset against your rental income for taxation purposes.
The fees while they can be a pain mean the development is kept tidy and looking well (in theory) as well as the more mundane things such as bins and insurance.

Baby01032012

Not to mention under the MUD Act they have to contribute some of the fees towards a sinking fund should anything structural or fundamental happen outside the yearly expenditure budget.

Samuel T. Cogley

There can be wastage, but only where people won't get properly involved with the OMC. If you're not willing to go to the AGMs armed with intelligent questions my advice is not to buy an apartment. If you're thinking of AirBnBing expect so questions to be fired at you through the chair and make sure that the apartment allows AirBnB - many do not.

Remember that most apartments and even townhouses are bought leasehold so you have to abide by the majority and the head lease.

Mrs OBumble

Lift maintenance is a big item for many apartments.

pinkypinky

I feel like the OP is from 10 years ago. You can't avoid paying them if you agree to buy an apartment in a block or any property run by an OMC. Before you invest, take some time to read up on all the relevant laws.

Bob24

windmilllane wrote: »

We are currently looking at buying an investment property in a busy tourist spot. Ideally we want a small townhouse but they are scarse. The other option is an apartment. With that comes management fees. I know bins and insurance can be included. Do you feel you get your money worth?

If you think maintaining the lift, keeping the common areas clean, fixing issues with the building, painting the walls every few years, getting insurance, taking care of the bins are all optional things ... yes they are a waste of money.

But otherwise you might want to consider paying them.

windmilllane

Bob24 wrote: »

If you think maintaining the lift, keeping the common areas clean, fixing issues with the building, painting the walls every few years, getting insurance, taking care of the bins are all optional things ... yes they are a waste of money.

But otherwise you might want to consider paying them.

Fair point, no need to be so grumpy

windmilllane

Thanks for all the replies. There's a lot to be said for not having to worry about all that maintenance

Bob24

windmilllane wrote: »

Fair point, no need to be so grumpy

Sorry for the sarcastic tone, but the question seemed a bit silly.

Management fees are obviously not a waste as such as these things need to be done. But of course depending on the specific development they can be more or less wisely used. Don't only compare the cost quoted by the EA when you view a place, but also pay attention to the condition of the building (if it looks dirty/worn-out and things like the intercom/the lift/lighting in the corridors/etc seem to have issues, it's not a good sign about how you money will be managed)

beauf

Check if you are paying to maintain a car park, if you don't own a space.