Based on our most recent survey, 60% of condo/co-op board members are most worried about one thing going into 2023: raising common charges or maintenance fees.
Of course, no one likes to hear they have to pay more, and it’s stressful as a board member to be the bearer of such news. But with a data-driven budget in place, you can use these tips to effectively communicate monthly increases and instill trust among your neighbors.
1. Do the research.
Make sure you’ve got a grasp on which operating expenses are increasing, and by how much. For example, insurance is expected to spike, utilities and oil prices continue to go up, affecting day-to-day products and services, such as the cleaning products you use. While you as a board have no control over these budget lines, you need to be aware and ready to make the case for all relevant increases.
For particular projects like a capital improvement, you may need to consider a capital assessment. Rather than a permanent increase, this would be a temporary monthly charge that would be on top of your monthly fees. Be sure to check out our tips for communicating special assessments to your owners or shareholders.
To learn more about building healthy condo/co-op budgets, be sure to check out our full budgeting guide here.
2. Be prepared with facts and figures.
You’ve done the hard part - the research. Now, be sure to use it when presenting your budget. Owners/shareholders will want to have a good understanding of why their fees are increasing and where their money is going. By showing your work and being transparent, you’ll gain their trust. They’ll be confident you’ve got your building’s best interest at heart.
3. Use data.
What are similar buildings in the neighborhood paying each month? If you can show that the common charges/maintenance fees of similar buildings around you are on the lower end, residents may be more willing to accept an increase. If your fees are higher than those around you - maybe you have a rooftop with a pool or you live in an older building that keeps requiring a bit more TLC every year - you should be prepared with a stronger argument for why an increase is necessary.
4. Be open to feedback.
It’s safe to assume residents will have some questions about your proposed fee increase. Be open to hearing their feedback and addressing any concerns they may have.
When communicating fee increases to owners and shareholders, your number one priority is creating a space of mutual trust and respect. This will enable you as a board member to show you’re always trying to act in the best interest of the building and ensure its financial and physical health for years to come. These conversations aren’t easy, but these tips will help bring trust and harmony into your building.
Have particular questions about your building or looking for additional guidance? Daisy’s finance team is here to help with whatever you need.