Hi,
I am looking at purchasing a unit which is part of a run down, old block of 8 units.
The thing is I know that these units have had trouble with water damage and general leakage is still ongoing.
I also know that the whole block of units is soon to be given a face lift.
I know all this because I am the architect fixing the problems and giving the face lift.
I would like to know if I were to buy one of the units now and sell after the renovations, would that we be all legitimate?
I didn’t want anyone hounding me after with insider information issues etc.Hoping someone may have some input?
Cheers
That's the kind of insider information we all wish we had. I don't think it's illegal to act on such information. It happens all the time, especially with big development companies who lurch from project to project on inside information. (Sorry to sound cynical).
It's not as if you are dealing in shares in a company, and you aren't the seller misrepresenting any info.
What's inside about it? The building has a sinking fund which is set aside to finance the cost, the minutes of the AGM reflect how the money is to be spent, part of the purchase price is the value of the unit's share of the SF (which will be depleted when the works are done), the purchaser of the unit will have the liability for any special levies for the works, the vendor doesn't want to/is unable to contribute to any special levies.
In a nutshell, that outlines your risk and upside.
Thanks for the input guys.
Special levies is a good point. I am only accustom to body corporates with 80 or more units so I have never really seen high levies.
Ill just have to hope that special levies for a block of 8 units isn’t or wont be too excessive and that most of it will come from the sinking fund?
Information I can probably get before the purchase?
property1234 rather than ask lay people where if you are alleged to make a mistake in ethics you would have to spend time energy and emotion defending would it not be better to ask your professional association for a ruling and also whether you would be obliged to disclose any additional information to the vendor.
I would be surprised if you could be accused of anything – but I would never discourage you from confirming that with any professional body that you are associated with.
As for the Sinking Fund. If you do a strata search, you will find out the financials and be able to see the balance of the sinking fund and the Admin Fund. If the cost far outweighs the balance of the sinking fund, then they will call for a special levy.
Thanks again.
Conferring with my professional body is definitely something which I will consider. I should have probably mentioned I am only a technically a graduate architect at the moment as I haven’t registered and I work for a firm.
The Strata Search sounds like a good idea and something I will most likely do. I may see what the Real Estate agent can supply me with first.
crj in response to the “lay people” term I couldn’t think of a better place to ask such a question. As most of the people on these forums seem to know what they are talking about, but more importantly actually have experience (and are doing etc).
It sounds as though my only issue MAY be surrounding my professional body and any regulations they may have. (Although I personally at this time may not be obligated in anyway.)
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