Home ownership comes with many costs that can be one time, monthly, periodic or even unexpected. Maintenance dues to housing societies, especially ones that offer many amenities, can balloon quickly and hence need to be accounted for in your monthly budget. With commercial properties, the costs are very high and are often a big factor in the buying decision, especially if there are large differences between the choices. While that is not the case for homes, still, costs tend to increase over time, and understanding the components can help you and the society to potentially rein them in.

Maintenance charges

Typically, Resident Welfare Associations (RWAs) collect monthly dues for expenses such as common area maintenance, utilities such as water, trash and sewage, running and maintenance costs for equipment such as lifts. Other charges include contribution to emergency funds for repairs and upkeep, parking charges, insurance and society running costs including any staff salary. The costs may range from a small amount of ₹2.5 per sq. ft. in a complex without many amenities to even over ₹20 per sq. ft. in luxury project.

Costs may be fixed for all or vary based on apartment size or other factors. For example, overheads such as security expenses may be higher for small complexes versus larger ones, as the amount is split among less number of homes. Other costs, such as for water, will be higher if there is a large garden or pool.

The amount also varies month to month based on usage. For example, if there is a diesel generator for backup power, the operating costs would change based on hours of power outage. Likewise, water costs – especially if there is a shortage and water is brought in by tankers – may increase during summer months and fall during the rainy season.

Choices determine costs

Your maintenance costs may be higher if the builder made poor choices during construction. For instance, lift costs – for power and maintenance – can be a significant part of the costs in many apartments. Selecting a size and brand that is not the best fit can rake up a lot of costs for the residents.

Likewise, the choice of sewage treatment is another area where the builder may have made a one-time cost saving, resulting in higher life-time cost for home owners. Poor quality of other infrastructure can also add to higher repair and maintenance cost. Buyers must pay attention to not just the material quality inside and outside the house, but also in the common areas.

Builders can also help owners reduce costs, if they invested in solar power generation, that can be used for common area lighting.

Adding infrastructure such as for rainwater harvesting can help recharge borewells and reduce the need to buy water.

Sewage treatment systems, that also include greywater reuse for garden or toilet flushing, also save water and cut water bills.

Room for savings

There are simple things apartment societies can do to cut maintenance costs. One, switching to better products can save money in the long-term. For example, installing LED lights in common areas can pay off over the long run.

Two, use of simple technology such as sensors to automatically turn off power and water can help. For instance, water monitoring for leaky taps and pipes can save water costs as well as electricity costs (for pumping the water to overhead tank and sewage treatment).

Three, residents can reduce their usage (especially if water is metered and you are charged on actual usage) by using water-saving fittings. For example, aerators fitted to taps are shown to reduce water outflow by up to one-third and lead to potential saving of 20 litres per day for a family.

Four, investing in waste composting can convert costs incurred for disposal to revenue from selling compost. This has been popular in various large complexes in Bengaluru after the city started implementing the Solid Waste Management Rules, 2016 which mandates bulk waste generators to process bio-degradable waste.

The author is an independent financial consultant

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