A buyer takes interim occupancy of a proposed condominium unit. The unpaid balance of the price is $480,000; assume the prescribed interest rate is 5% per year. Estimated municipal taxes for the unit are $250 a month and the projected common expense contribution is $450 a month. What is the maximum monthly occupancy fee the declarant may charge?
Correct Answer
A) $2,700
Section 80(4) of the Condominium Act, 1998 caps the monthly occupancy fee at interest on the unpaid balance at the prescribed rate, plus estimated monthly municipal taxes, plus the projected monthly common expense contribution. Interest is $480,000 x 5% / 12 = $2,000; adding $250 and $450 gives a maximum of $2,700.
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