Closing day in New York feels like a finish line, months of paperwork, approvals, and negotiations finally behind you. But for condo and co-op buyers, it’s really the starting point. Once you move in, monthly charges and unexpected costs can shift quickly. A maintenance fee that looks manageable today may rise 10–15% within a year. A building that seemed stable at closing may levy a hefty special assessment months later.
Understanding these financial realities upfront helps buyers avoid surprises and plan with confidence.
Monthly charges: maintenance fees and common charges
Every building has recurring monthly costs. In co-ops, they’re called maintenance fees; in condos, they’re common charges. These cover expenses like staff salaries, building insurance, utilities, and day-to-day upkeep.
Boards revisit the budget each year. Increases are common, often driven by:
- Rising property taxes and utility costs
- Union contracts for staff
- Higher insurance premiums
- Inflation affecting supplies and services
A 5–10% annual bump isn’t unusual, and in some years it may be more. Buyers who expect their monthly charges to remain flat will almost always be caught off guard.
Special assessments: when regular fees aren’t enough
Even the best-run buildings sometimes need to collect additional funds from owners. These special assessments are one-time charges spread across all units, usually to cover major repairs or unexpected costs. Examples include:
- Local Law 11 façade projects
- Roof replacements or elevator upgrades
- Emergencies, like water damage or structural issues
- Compliance work tied to new regulations, such as Local Law 97 carbon reduction requirements
Assessments can range from a few hundred dollars to tens of thousands per unit. Boards sometimes use them instead of raising monthly fees, especially when costs are tied to a single project. That’s why buyers should ask whether any assessments are planned — or if the board recently completed one — before signing a contract.
For tips on how boards communicate these charges, see our guide to special assessments.
Reserve funds: your building’s savings account
A healthy reserve fund is one of the best indicators of a financially stable building. These funds cover large projects and unexpected expenses without forcing immediate assessments.
Some boards intentionally keep monthly charges slightly higher to build reserves steadily over time. While that may feel more expensive in the short term, it’s a sign of strong planning. In the long run, owners benefit from fewer surprise bills and better-maintained property.
Our guide to reserve funds breaks down how much buildings should typically keep in savings and why it matters to buyers.
When management changes
Another factor buyers rarely consider: buildings sometimes switch management companies. A new firm will often conduct a detailed review of the budget, reserves, and capital needs. If they uncover gaps — like underfunded reserves or deferred maintenance — the board may need to raise fees or issue an assessment sooner than expected.
For buyers, it’s a reminder to ask not only about the building’s financials today but also about any recent or upcoming management changes. A transition can be a turning point for a building’s financial health.
What buyers should realistically expect
- Annual increases. Plan for maintenance fees or common charges to rise 5–15% each year.
- Potential assessments. Even well-managed buildings levy them occasionally.
- Capital projects. Buildings with aging roofs, elevators, or façades may need major upgrades — often at significant cost.
- Regulatory compliance. Local Law 97, energy upgrades, and safety regulations can all drive new expenses.
How buyers can prepare
Before buying, ask these questions:
- How much is in the reserve fund, and what projects are planned?
- Have there been assessments in the past five years? Are any coming soon?
- How often have maintenance fees or common charges increased, and by how much?
- Are there major compliance requirements (like Local Law 97) on the horizon?
Working with your attorney and broker, review the building’s financial statements closely. Don’t hesitate to ask the board or management company for clarification.
The takeaway
Buying into a condo or co-op isn’t just about your unit, it’s about sharing responsibility for the whole building. Fees will rise over time. Assessments may happen. And reserves are what keep everything running smoothly.
If you plan for these realities from the start, you’ll not only avoid sticker shock, you’ll feel more confident about the long-term value of your investment. A building that raises fees responsibly and builds healthy reserves is one that protects both its residents and its future.
