Property management companies are becoming crucial factors in buying condos that make long-term economic sense.
Right At Home Realty Broker Manu Singh says exceptional property management is the chief determinant in how little maintenance fees increase during his clients’ tenures in their condos.
“We see that there are property managers that have good historical records of upkeeping buildings, yet remaining cost-efficient,” he said. “There’s an inverse relationship between maintenance fees and selling price down the road, so if the property manager can be prudent in their management strategies, we see in the long run that they’re able to keep maintenance fees in check and that helps a lot with future retail value with the condo.”
Amenity packages also largely determine the severity of condo fees. Singh’s clients are “sophisticated downtown professionals,” for whom he recommends eschewing superfluous amenities.
“All downtown professionals really want is a party room, as well as an exercise facility, and if it’s good enough they can save on a monthly gym membership,” said Singh. “But they don’t necessarily want excess, like basketball and tennis courts, saunas, steam rooms—extra stuff they won’t use because that hits their costs and then their maintenance fees rise. Buyers are selective and prefer buildings that are efficient. They’re prudent and savvy around not having any extra amenities they’re not going to use. That huge pool is a deterrent nowadays.”
While reputable property managers are paramount, so, too, are builders. Does the builder traditionally develop low-rise suburban homes, but has decided to give condo building the old college try? How do the condo units appreciate over, say, five years?
“If it’s Tridel or Daniels, they’re top-notch brands, but we look at history too, like how many total projects there are in that particular area,” said Singh. “We also look at how many projects are currently on the go. You can see premium builders that take the time to put in good, quality materials, and these are the types of things that help buyers realize their investment is likely to be secure.”
Canada’s three largest real estate markets are saturated with condominiums, so research is imperative—especially if sales agents want happy, returning clients.
“The number one thing I look at is the builder,” said Akshay Dev of REMAX Realty One. “Their background and past record are important—what kind of buildings have they built in the past and how have their values held up? Are they using the same property manager the builder set up or has the board of directors found new property management? If the property management has changed, I dig deeper to find out what happened. Some builders have their in-house property management companies, like Tridel whose company is called Del Property Management. But one has to see on a case by case basis.”