While buying a house, maintenance charges are one of the common future problems that home buyers fail to take into account. Maintenance charges are decided, only after the builder decides the amenities, finish and quality of the building and value added services that the builder aims to deliver in the project.

Accordingly, the amount of money that buyers have to spend on monthly maintenance charges, comes as an ugly truth.

The builder is usually in charge of the overall maintenance, and it is his responsibility to disclose this cost to the home buyer, at the time of buying the property. Before the project is completed, the builder has to take charge of maintenance expenses and afterward, transfer it to the association or society.

Below are few methods of calculating maintenance charges. They are as follows:

Per Square Feet Charge:

Per square feet method is the most used method for calculating maintenance charges for housing societies. According to this method, a fixed rate is charged per square feet of the area of an apartment.
For instance, the rate per square feet maintenance charge for an apartment complex is Rs. 3.0 per sq feet per month. Therefore, if someone owns an apartment of 1000 sq. ft, then the maintenance charge is Rs 3000 per month. And by the same calculation, a person owning an apartment of 2000 sq. ft would pay a maintenance charge of Rs. 6000 per month.

Equal Maintenance Fee:

This is the simplest way to collect maintenance charges where a fixed amount is charged on all apartments. It works well in apartments complexes having same sized flats. This is one of the unfair methods for complexes have different size of apartments as the small apartment owners’ end up paying an unfair amount of maintenance.

Hybrid Method

A hybrid method is implemented by some resident’s societies in order to be fair to the large apartment owners. This method includes splitting the charges into two with the first part including all the common expenses like common electricity, audit fees, meeting charges, property taxes, lifts etc. The second part includes the area based charges that are specific to the apartments such as electricity usage and water bills.

This is a non- refundable sinking fund which is charged by the society for major repairs. All the owners are supposed to contribute to the sinking fund, which grows over the years. It is normal to collect at least 0.25% of the construction cost of the apartment excluding the cost of land as sinking fund charges. This depends on the size of the apartment and the amount stays with society until repairs are undertaken.

Conclusion

There is no foolproof method to calculate the maintenance fee that an owner should pay the apartments owner association. Every model has its own pros and cons. The residents’ society should decide which model works best, depending on the apartment complex and implement it accordingly. Further, a half-yearly meeting should be conducted to discuss the possibility of the plan and also to cut down any charges that are levied needlessly