Brokers: High condo fees reducing demand for Worcester units
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Brokers say high condo fees in Worcester have led to a reduction in sales.
Condominium sales in Worcester fell by nearly 9% in 2019.
But brokers say it was not caused by the lack of inventory or that median prices have risen by 26% over the past year.
They insist high monthly condo fees killed dozens of deals.
Take Lynne Grden’s 10th floor, five-room condo on Lake Street with views of Lake Quinsigamond. The Keller Williams Realty broker in Westborough listed the two-story penthouse in the Lakeshore complex for sale in November for $305,000.
The unit features a fireplace, a spiral staircase to the second floor master bedroom and bath with marble floors, skylights, a steam room, and walls of glass. There’s underground parking for two vehicles.
Grden said lots of potential buyers toured the unit and were willing to make an offer. But the monthly maintenance fee of $1,058 caused buyers to back off.
“The most recent buyers who looked at it, loved it, and they had no problem with the price,” she said. “But the $1,000 condo fee made them walk away. Buyers have told me paying those high fees is like flushing money down the toilet.”
Jeffrey Incutto, an agent with Real Living Barbera Associates in Worcester, agrees.
He said nearly three dozen condos for sale in Worcester on the MLS Property Information Network were priced from $79,900 to $369,900. But rising monthly fees are making selling more difficult.
“There are lots of deals out there, but the condo fees can be an issue,” he said. “If a condo lists for $130,000 and the fee is $600, that can be a deal killer.”
A three-bedroom townhouse condo on Pointe Rok Estates was originally listed in 2018 for $309,900. Since then, the price has dropped to $289,900. But the condo fee remains at nearly $1,200.
Grden said fees and assessments have been rising, in part, due to a lack of maintenance.
“We see condo developments that have been mismanaged, and as they age they may need a new roof,” she said. “That cost is passed on to condo owners, who must pay an assessment on it until it’s paid, in addition to their regular monthly fee.”
She said sellers have no control over the cost of fees.
“It’s not like the seller can lower the monthly maintenance fee,” she said. “It’s set by independent management companies based on several factors. They tell me insurance costs are rising, snow removal can be tricky, and many of these condo development lack reserves, money they need in case of emergency repairs, and that too needs to be funded.”
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