Exploring the unnoticed amount you pay as 'Maintenance Charges'

17-Dec-2018    |    Source:    Times Property

What often goes unnoticed when buying your dream home with a plethora of amenities is the amount you will pay as ‘maintenance charges’. Here’s exploring the economics of this expense


Imagine living in an urban township complete with indoor and outdoor sports facilities, gardens, banquet halls and recreation facilities. Now, calculate the premium you would pay if all these required additional fees in the form of gymkhana or club memberships. Today, most new residential projects come loaded with some form of lifestyle amenities that act as a significant value-add to homebuyers. Gone are the days when the maintenance costs of these amenities daunted the purchaser; today’s home-owners lay a lot of emphasis on one’s quality of life. Deepak Goradia, VP, MCHI, says, “Due to the fast-paced urban lifestyle, people hardly get time with family and the traffic woes have made it even more difficult to travel to a theatre, gym or restaurant. Hence, it makes sense that the indoor and outdoor facilities are available within the project.”

Loading residential units with amenities is a win-win strategy for both buyers as well as developers, with the former gaining a better standard of living and the latter being able to drive volumes and bring down cost-per-flat. In cities, such as Bengaluru, Chennai and Pune, lifestyle amenities act as an attractive proposition while in a highly competitive property landscape such as Mumbai, amenities are a way to compensate for reducing unit sizes. However, experts advise extra caution when assessing such value-added properties.

“Firstly, find out how much the monthly outgoings are towards these amenities, and if these charges are justified by your family’s usage of these amenities.

Most large residential projects are constructed in phases and disputes arise when the amenities of one phase are not completed but members are expected to pay common maintenance charges. Residents will do well to take all commitments pertaining to amenities on email before purchase,” advises property advocate Vinod Sampat.

Costs aside, amenity-rich residential projects cater to urban home-owners’ deepest desire for a community culture. Secretary of a leading residential township in Mumbai, Darius Avari says, “Many young parents want to raise their children in the same community environment that they grew up in. The lifestyle amenities in our society facilitate this community bonding through events for kids and senior citizens.”

As the number of families move into modern residential projects, per head maintenance charges for the same number of amenities are most likely to reduce. As Ashok Mohanani, vice president, NAREDCO West, concludes, “Homes today offer an integrated lifestyle where one can spend quality time with family. Amenities are designed to boost individual and family well-being while also inspiring community culture.”

Once the society or RWA is formed, maintenance charges should be mutually agreed upon by a general body meeting, as governed under the bylaws of the Maharashtra Co-operative Societies Act, 1960.


There are multiple ways of calculating MCs. RWAs use a mix of flat rates for essential services such as building repairs, lifts and power supplies while lifestyle amenities such as gyms, clubs and gardens are charged on a Per Square Feet basis.


What does the law say about maintenance charges? MahaRERA stipulates that the developer is liable for all maintenance works until the society is registered as a Resident Welfare Association. Developers cannot levy maintenance charges until possession.


MCs are hard to define and can range anywhere from Rs 2 to Rs 25 PSF, depending on the locality, the number of residents and total units in the residential complex; Builders are forbidden from changing ad hoc expenses under maintenance heads. Usually, 0.75 percent of the construction cost of the flat is charged towards regular repairs and maintenance of common utilities such as elevators, security and housekeeping services etc.



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