How much does owning a condo really cost?

Owning a condo costs more than your mortgage. Plan for the mortgage payment, monthly HOA dues, property taxes, unit insurance (an HO-6 policy), utilities, and a cash cushion for special assessments. Dues alone often run several hundred dollars a month. Add it all up before you buy, not after. Related: What are condo CC&Rs and why do they matter? . What are the real monthly costs of owning a condo? A condo has five recurring costs, and the mortgage is only one of them. Related: How much does condo association governance cost? . Most first-time buyers budget for the loan and forget the rest. That gap is where people get squeezed. Related: What is a condo special assessment and how do you prepare for one? . Mortgage principal and interest. Your loan payment, same as any home. HOA dues. Monthly money that funds shared upkeep and the reserve fund. Property taxes. Billed on your unit, often folded into your mortgage escrow. Unit insurance. An HO-6 policy covers what's inside your walls. An HO-6 is the condo owner's personal policy that sits behind the building's master policy. Utilities. Some are bundled into dues, some you pay direct. Ask which is which. Start with these five. Everything else is a variation on them. Our condo financing readiness assessment looks at these same numbers when checking whether a building is loan-eligible. Related: How do you find condo association governance help near you? . How much are condo HOA dues, and what do they cover? HOA dues vary widely by building, but they usually run a few hundred dollars a month and fund the shared parts of the property. Dues are not a fee you can skip. They are how the association pays for what everyone shares. Common area upkeep. Lobbies, hallways, landscaping, parking. The master insurance policy. Covers the building structure and shared spaces. The reserve fund. Savings for big future repairs like roofs and elevators. Day-to-day operations. Trash, water in some buildings, management fees. Higher dues are not automatically bad. A building with strong reserves and full amenities costs more to run than a bare-bones one. What matters is whether the dues actually cover the building's needs. What one-time and surprise costs should I plan for? Beyond the monthly bills, budget for closing costs at purchase and a cash reserve for special assessments later. A special assessment is a one-time charge the association bills owners when a big cost exceeds the budget. See our guide on condo reserve requirement analysis for how weak reserves lead to these surprise bills. Closing costs. Loan fees, title work, and any HOA transfer or move-in fees. Special assessments. Unpredictable, sometimes thousands of dollars, tied to how healthy the reserve fund is. Interior repairs. Everything from your walls in is on you, not the association. Proof Condo living is expensive because so many costs stack on top of the mortgage. HOA fees can add a meaningful monthly amount, and many buildings have seen them climb over time as insurance and maintenance costs rise. That amount sits on top of your mortgage, taxes, and unit insurance, which is why buyers who budget for the loan alone can get blindsided. How do I add up the true cost before I buy? List every recurring cost, add a monthly reserve for surprises, and compare that total to your budget, not just the mortgage. Get the current HOA dues in writing and ask how often they've risen. Pull the property tax figure for that specific unit. Price an HO-6 policy so you know your insurance line. Ask which utilities are included in dues and which you pay. Read the reserve study and recent minutes to gauge special assessment risk. Add a monthly cushion for the interior repairs that fall on you. Do this before you make an offer. The building that looks cheap on the listing can cost the most once the full picture is in front of you. Related: What are condo CC&Rs and why do they matter?.

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