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Why Are The Association Fees So High?

By
Real Estate Broker/Owner with Daytona Condo Realty, 386-405-4408

This question came to me in email. It is about Daytona Beach Resort & Conference Center (DBR&CC). I do not know their line-by-line expenses, but I will try to answer in general.

Association Dues stem from the budget. The Association establishes the budget, and then divides it among the condo owners.

Daytona Beach Resort & Conference CenterIn DBR&CC they go by the room, so it does not matter what size, every room is assessed the same. Now it is $475 a month. For quite some time it used to be $450.

Hawaiian Inn, using the same by-room assessment, charges $450. Plaza Resort & Spa charges $555 a month.

So, which factors play a role? Of course, the cost of kilowatt is pretty much the same for every condo-hotel. Same with other utilities, and hourly labor.

Let’s look at Daytona Beach Resort & Conference Center. Over 400 ft on the ocean, a lot of decking, a lot of grounds to take care of. They have 2 large outdoor heated pools, kiddie pool and indoor pool. So, you will be spending more on them (maintaining, heating), than in a condo-hotel, where you have only one pool.

It has a lot of conference space, workshops. I don’t think there is justifiable income, but it is the expense, which many other condo-hotels don’t have.

Multi-level garage. Majority of other condo-hotels have ground level open parking. Maintaining the garage costs money.

To me it is not surprising that DBR&CC’ expenses maybe higher than in some other condo-hotels.

Does it affect the bottom line? It most probably doesn’t. Rental income is more important than what you pay in Association Dues. If the income is decent, then it is enough to cover the Association Dues (aka Maintenance fee) and Property Taxes. And this is considered good for Daytona Condo-hotels.

From what I know, it is the case in DBR&CC.

Of course, this is just my opinion.

Follow this link for the list of condos for sale in Daytona Beach Resort & Conference Center

Jill Sackler
Charles Rutenberg Realty Inc. 516-575-7500 - Long Beach, NY
LI South Shore Real Estate - Broker Associate

I bet you get that question a lot and it's a very thorough response.

Oct 07, 2014 04:43 AM
Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

Jill - this is a nice looking property, and every time after the showing I would tell customers, that owning a unit in DBR&CC would cost more than in many other places, and they always ask "Why?"

Oct 07, 2014 10:40 AM
Eileen Burns 954.483.3912
Trans State Commercial Realty Inc. - Fort Lauderdale, FL
FLorida Real Estate Connector

Jon the escalating insurance premiums surely add to the increases as well.  wonder is they have a reserve account for capital improvements.

Oct 07, 2014 01:10 PM
Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

Eileen - thanks for mentioning the insurance. It is actually the biggest chunk of Condo Owners fees. However, if mismanagement can create a disproportionate increase in fees, insurance would hit every condo or condo/hotel in pretty much the same say.

Again, thanks for pointing it out, it is a big thing, indeed.

Oct 08, 2014 03:58 AM
Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

Of course there's always the question of how well they are funding their reserves as well, Jon.

Oct 08, 2014 10:14 PM
Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

Gabe - you would be surprised, but usually condo-hotels do not have reserves. They simply vote to forgo the reserves in favor of  smaller payment. Not the best strategy, but this is how they often do.

Oct 09, 2014 06:22 AM
Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

Wow, Jon.  I am surprised.  So, then, the special assessments must come up fairly regularly.

Oct 09, 2014 08:19 PM
Jon Zolsky, Daytona Beach, FL
Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices

Gabe - and that's exactly what they do. Come with regularity :)

Oct 10, 2014 07:15 AM