Buyer beware: Condo maintenance fees continue to soar
If you're buying a condo, maintenance fees are oftentimes an unknown variable.
HONOLULU (HawaiiNewsNow) - Fee increases could sneak up on you, and might even price you out of a place you thought you could afford.
That's the situation a number of Hawaii condo owners are facing, as aging properties seek to up maintenance fees to tackle repairs and upgrades.
Attorney Terry Revere, who specializes in real estate issues, says developers are supposed to provide an "honest assessment of what they think it's going to actually cost homeowners to maintain their units."
But calculating maintenance fees isn't an exact science, said Kay Mukaigawa, principal broker at Primary Properties.
"Sometimes they're not always not accurate, but they do try their best and it is reviewed," she said. "Those maintenance fees are something they like to keep stable for a period of time."
Revere sees the worst cases -- when year-to-year fee increases can price out some owners. "I've had cases where they've gone up 40 percent in the first year. Cases where the first couple of years they've gone up more than a 100 percent," he said.
Making the situation more difficult -- maintenance fees can be significantly different, building to building.
The maintenance fee at the luxurious Park Lane at Ala Moana Center is a little over $1,000 a month.
The fee is around $650 per month for the largest one-bedroom at Keauhou Place in Kakaako.
"I honestly believe that most developers try their very best to stay within a certain budget and keep that on cue," Mukaigawa said.
There are some things you can do before you buy to make sure you're not caught off guard by rising fees, she said.
One is to review the building's reserve study, available to every buyer, which lays out how much it has in the bank to maintain the building.
"I think condo docs in general are something a buyer should look at," Mukaigawa said, "They should look at the budget, they should look at everything they're signing."
To determine if your building's maintenance fees are adequate, Revere added, look at other buildings in your neighborhood that have similar features and compare.
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