Time to reTHINK on how to Enhance your Property Value

Most buyers do not take into account the maintenance fees when purchasing a condo unit. You view it as an expense or in the corporate world, it is a cost center. You should view it as an opportunity to enhance your estate such that your property price will rise in the future because of good maintenance.

What is the Difference between maintaining a public and private estate ?

If you stay in a HDB (Housing Development Board) flat, which is also known as a public housing, the maintenance for the estate comprises of 2 parts. The first part is for the maintenance of the estate and the second part is for parking of your car. Your maintenance fee is billed by your Town Council who is primarily responsible for the maintenance of the HDB estate. The parking fees for your car is billed separately by HDB.

Rebates for Families.

At times, the Government offers rebates to families living in public housing. The amount of rebates will depend on the flat type that you reside in.

Maintenance of a Private Estate

However, if you stay in a condo whereby the private estate is managed by a Managing Agent (MA). The maintenance fee is usually billed on a quarterly basis and sent by the MA. Needless to stay, there will not be any rebates for you as private condo owners are considered as "being able to take care of themselves". Typically, the parking for the resident's first car is included in the maintenance fees, unless if you stay in the city. However, do note that although most Developments offer at least the first parking lot to residents for free and it is not a right but a privilege as the Developer does not have any obligations to offer any parking lot under the URA guidelines.

If you buy a condo in the city area such as Condos in the Marina Bay area, you may not be offered any parking lot and may have to pay for parking your car which is exclusive from the Maintenance fee that you are paying.

How much Maintenance fees will you need to pay ?

Usually, if you purchase a larger size home, you will need to fork out more maintenance fee as it is assumed that you have more people staying in your home and will use the facilities. You may ask argue that it is not fair to pay more as you don't use the facilities or that in your "big" home there is only 2 persons36.

Maintenance Fee = Management Fund + Sinking Fund + 3rd Component

The Maintenance Fee that you pay as a owner or Subsidiary Proprietary comprises of 2 main components + a 3rd Component which is not often seen.

The maintenance fees that each owner has to pay relates to amount of Share Value that is allocated to that unit. The same theory applies during a vote for the AGM (Annual General Meeting) resolution, where the unit with the higher SV (Share Value) has the greatest influence. This is similar to a gasholder in a company. Whoever has the most shares has the most say in any action.

Let's think of the Management Fund as the funds that the Management utilizes for the maintenance of the estate. The budget for Management Fund is proposed by Management Council and approved by the General Body during the AGM.

Let's think of the fund as savings for the big improvement works to be done for the estate such as Repainting, Trees Pruning and Replacement of Wooden Decking, etc

The 3rd component will only be activated if the Management Council needs to raise funds for Special projects as the existing funds are insufficient. Unlike the Management and Sinking Fund collection, the Special Levy is usually collected for only a year if the Ordinary Resolution of 5o% approval is passed by the General Body during the AGM.

1. Legal case against the Developer for any defects
2. Repainting of the estate after 5 to 7 years depending on the state of the estate
3. Installation of Bird Netting
4. Lift Moderisation Project
5. Other Major Improvement Works