When a prospective buyer was first looking at condos, they thought that a property with a management fee of $350 was definitely a better deal than one with a fee of $900. However, upon further investigation, they found that the $900 building had not had any special assessments in the last five years, while the $350 building had a history of a special assessment over $10,000 per unit for roof repairs two years ago. This case illustrates that a lower management fee is not always a good thing.

To put it simply, HOA fees are the money that residents pay to share the common costs of maintaining the building. This includes maintenance of the exterior and roof, master insurance, management of common areas like lobbies and elevators, landscaping, trash collection, and sometimes a portion of utilities like water or heating, as well as reserves for major repairs. If the terminology is unfamiliar, think of it as a mix of insurance premiums and savings for future repairs included in the monthly management fee.

The median monthly HOA fee in the San Francisco metro area is $502 as of 2025, a significant increase from $360 in 2019. Typical condos range from $300 to $800 per month, while full-service high-rise buildings can exceed $1,200 to over $3,500. Compared to the statewide median of $336 in California, this is quite high.

Operating an older building with insufficient reserves can lead to significant expenses down the line. Simply put, if the roof or plumbing fails all at once without any savings set aside, residents will suddenly have to share the costs. California's Davis-Stirling Act requires associations with major asset values exceeding half of the budget to conduct a reserve study, including on-site inspections at least every three years, and as of the 2025 SB 900 amendment, the scope now includes inspections of gas, water, and electrical infrastructure. Experts believe that reserves should be at least 70 percent of the anticipated needs for stability.

Buildings near school districts preferred by Korean families tend to maintain a higher level of management, which also leads to higher fees. While school ratings can be checked on sites like GreatSchools or Niche, the boundaries often change, so it's advisable to verify the assigned school for the specific address before purchasing. Investors considering rental income should also factor in that high management fees may not be fully passed on to rental prices.

If moving from another state, judging HOA fees based on previous residences can lead to significant discrepancies. Mortgage lenders review HOA delinquency rates, reserve ratios, litigation status, and the proportion of commercial space, and if they fall short of standards, the property may be classified as a non-warrantable condo, resulting in loan denial. Even if a property is appealing, if it fails this review, the buyer may have to start their search all over again.

The San Francisco condo market is largely divided into two categories: newly built full-service high-rises and small condos converted from Victorian-style buildings. The latter, being older, may require structural inspections or seismic retrofitting, so even if the management fees appear low, it's essential to check the reserve status. In contrast, high-rises tend to have higher fees but are less likely to require major repairs immediately due to their recent construction.

Here's a summary of items to check before purchasing:

• Recent reserve study results and reserve ratios
• History of special assessments in the last five years
• HOA financial statements and delinquency rates
• Ongoing or pending litigation status

Rather than just asking how much the fees are, it's safer to first check how that money is being spent and how much is being saved. This article is not investment or legal advice, and it is recommended to consult a real estate professional before making any actual contracts.