I sometimes run into condos and townhomes that have higher than average fees – sometimes the developments have been poorly managed in the past and are trying to make up for past transgressions and other times they are simply not being prudent with their budget. Not only do high association fees cost each homeowner more money per month, outsized dues can also be detrimental to the resale value of these homes.
With so many condos and townhomes for sale today buyers are more picky than ever on what they buy and when they are figuring in their monthly payment they are certainly taking the association fee into account. A good general guide is that each $1000 financed costs a borrower about $6 per month in payment so if one association’s dues are $30 more than another with similar amenities, to a borrower that’s equivalent to losing $5000 in buying power! It is important to keep the total cost of ownership in mind when looking to buy a condo or townhome or when you live in one and are considering a day in the future when you have to sell it!
Sometimes it seems like buyers forget that they’re actually getting something for their association payment and they forget that when their is an association payment they don’t have to make a cable payment, water, sewer, trash payment, lawn company payment, plowing company payment, insurance payment, etc. Oh and then there is the roof that needs to be replaced, the driveway that needs to be resurfaced. For a single family home these can often add up to $10k or more. Look at an association fee as a budgeting tool. It’s not like anyone is profiting off of your association payment.
It is seems like it’s usually a wash.