Hi guys,
I have never purchased a unit previously however am currently exploring the market as I feel it may best suit our current needs. I am however struggling to understand the rationale behind strata fee price variances.
I fully appreciate that the greater the services typically the greater the fees – pools spas gyms etc all cost money and have to be paid for some how. That said one property I recently had an interest in was a 1 bedroom old warehouse conversion in a block of 14. No onsite manager, no joint services, nothing and the strata fees are quoted at $930 PER QUARTER. Looking at other properties in the area they are charging as low as $500 per quarter.
Does anyone know how these prices are fixed and what they contribute to – if the money was going towards a major refurb and then reverting to a more reasonable rate it may be financially worth my while but if not then how is this number arrived at.
All thoughts appreciated.
Craig
Strata levies are comprised of two elements – administrative fund and the sinking fund.
The sinking fund covers such items of the common property that require maintenance eg lawn mowing/garden maintenance, painting, replacement of broken/dilapidated/unsafe common area items (eg lighting, paths, external doors, balustrading etc). There may be some special levies occasionally to cover one off costs – eg council fire order, perimeter fence replacement etc.
Admin fund covers such costs as building insurance and costs to administer the strata scheme.There is an annual budget prepared for both (presented at the AGM). A copy of the minutes and the budget should be available for you/your solicitor/accountant to review – refer to the exec of the body corporate or the strata manager (who prepares the budgets).
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