What ongoing expenses can one expect when buying a single unit in a block? e.g. body corporate fees, etc. Also, can a body corporate stop you from leasing a unit out, and can they have any say in the who the tenant is?
wblack wrote:Also, can a body corporate stop you from leasing a unit out, and can they have any say in the who the tenant is?Not that I know of – would make for a pretty dismal investment if that was the case
Jamie Moore | Pass Go Home Loans Pty Ltd
http://www.passgo.com.au
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wblack
I would be looking at a lot of things before buying on a block of units.Body Corporate
Sinking fund
Condition of the exterior of the building
Age of the building and how high it is
What can go wrong, e.g. if there is a pool what is the condition of it, what is the condition of the balcony railings etc.
Who is managing the unit
What maintanece has been done on the unit and what is requiredI am not trying to scare you, but if the sinking fund does not have enough money in it for repairs etc. then the body corporate can attach a levy to each owner to get enough money.
An exapmle is a 20 storey building on the gold coast, a levy of almost $10,000 was attached to each unit to repaint the exterior and replace the balcony rails.I build house and units, but I would only ever buy a new unit.
Email me if you want more info.
RegardsI couldn't agree more with Bluegrass. There are a lot of townhouses fore sales in the market some are maintain well with their body corporate others their body corporate are no good.
For instance, when your letter of offer is accepted, I assume you have one, part of your "subject to clause" is looking at the 'body corporate sinking fund', minutes meetings, etc. In addition, building / pest inspection will tell you the structure of the building.
So if you do your 'due diligence' properly you'll avoid purchasing a lemon.
Good luck.
Cheers
wblack wrote:… can a body corporate stop you from leasing a unit out, and can they have any say in the who the tenant is?If the property is company titled rather than strata titled, then not only do the other directors have a say as to the tenant but also whether you would be a suitable buyer.
Thanks for all the feedback so far, it's much appreciated. The unit we have in mind is one of 10 that are for sale. No pools, balconies etc, just 10 2 bedroom unit on the one block. They are all owned by the same person and being sold off individually. They are one and half years old and all currently tenanted. Any alarm bells here for anyone? Warrenwblack
The only question is, why all of a sudden is it being sold?
Does the owner need money or does the building have a structural problem and the owner is trying to reduce their exposure!
RegardsSavvy investors buy block of units, then get a council approval to sell each unit individually then retain few units therefore making the owner richer.
if the building is quite new, I still get a qualified building/pest inspector to assess the structure of the building…you cannot be too careful these days not even for a brand new unit. Make sure the corporate body sinking fund has sufficient fund and there are no structure damage to other units as reported on minutes meeting. You don't want to buy a unit then few months later you are slap with few thousands of dollar on levy which funds to fix building structure of other unit.
Your conveyencor or solicitor will advise you if there is major problem with the building structure and issue with the body corporate sinking fund through building inspection report and strata records.
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