Let's start with the median management fee. The median monthly condo fee in Baltimore County is reported to be around $307. However, in some reports that include areas near the city center, the average can be as high as $886 (according to steadily.com, among others). Just looking at these two numbers can be confusing as to which one is correct. The reason for this significant difference is that condo and townhome HOA fees are aggregated based on different criteria.

Townhome or single-family home HOAs typically include only landscaping, snow removal, and maintenance of common roads, resulting in relatively lower fees. In contrast, condos include the building's exterior, roof, elevators, and master insurance in their fees, which is why condo fees tend to be much higher even in the same area. Across the state of Maryland, condo fees are generally found to range from $200 to $400 per month. This means that when comparing listings, it's important to distinguish whether the property is a condo or a townhome, rather than just looking at the item labeled as management fees.

This number indicates that one should not judge monthly expenses based solely on the sale price. Baltimore has a market where newly constructed high-rise condos near the harbor and small condos converted from row houses are both traded. It's important to note that buildings converted from row houses, which have fewer units, may have a higher per-person burden due to fewer residents sharing the management fees. Newly constructed buildings near the harbor may have high fees, but they often include amenities and on-site management, making simple comparisons difficult.

Maryland passed House Bill 107 in 2022, mandating reserve studies for condos, cooperatives, and HOAs established before October 2022. They are required to complete the reserve study by October 1, 2023, and renew it every five years, ensuring that they reach the recommended reserve levels within three years. Notably, there are no exceptions regardless of size. This means that condos in Baltimore now have a clear basis for publicly requesting the results of reserve studies. Since this law was enacted, listings have increasingly included whether a reserve study has been conducted.

For reference, small condos converted from row houses may have only three or four units, so there may still be associations that have not completed the reserve study required by HB 107. If you are looking at such buildings, it's safer to verify the completion of the study through the association's minutes or recent meeting materials rather than relying solely on the listing. Here are some items to check when considering a condo:

• Whether a reserve study has been conducted and the date of the latest update
• The actual reserve status compared to the recommended reserve amount from the study
• Recent history of special assessments and delinquency rates
• Rental restrictions and pet-related management regulations

Mortgage lenders also review these financial factors, so if reserves are low or delinquency rates are high, the property may be classified as a non-warrantable condo, making loans more difficult to obtain. Especially after the implementation of HB 107, lenders are increasingly including the completion of reserve studies as part of their review criteria, which could disadvantage buildings that have not yet completed the study in securing buyers. If families are moving to Baltimore from other states, they should also check that the property tax assessment method may differ from their previous state of residence.

Additionally, a reserve study is a report that calculates the remaining lifespan and replacement costs of major facilities such as the building's roof, exterior walls, elevators, and plumbing, presenting a savings plan for the coming decades. It's not enough to just look at the study; it's much more accurate to compare it with the budget execution records from recent years to see if the recommendations are actually being followed.

This article is not investment or legal advice, and it is recommended to verify the results of the reserve study with a real estate professional before making any actual contracts.